How Costpoint Time and Materials Billing Works
The process begins with project transactions such as employee time, labor classifications, material purchases, and other billable costs. Costpoint applies the contract's billing rules and configured rates to determine which transactions are eligible for customer billing.
For example, suppose a contract permits 120 billable engineering hours at $150 per hour and includes $4,500 of eligible materials. The labor component is 120 × $150 = $18,000. Adding the eligible materials produces a billable amount of $22,500, before any applicable taxes, fees, or contractual adjustments.
Accurate source transactions are therefore essential. Approved time, project assignments, labor categories, rate tables, material records, and contract terms all influence the final invoice.
Labor, Materials, and Billing Rate Components
Labor billing normally depends on the employee's project assignment, labor category, effective billing rate, and approved hours. Different contracts may use different rates for engineering, consulting, technical, or administrative work. Effective dates and contract modifications must also be reflected when rates change during a project.
Materials are handled separately from labor because contracts can define which purchases are reimbursable and whether specific markups or restrictions apply. Finance teams can review transaction-level detail before billing so that customer charges remain aligned with contractual requirements.
- Labor hours: Approved project time multiplied by the applicable billing rate.
- Materials: Eligible project materials included according to contract rules.
- Other billable costs: Authorized expenses or project charges that the contract permits for reimbursement.
- Billing adjustments: Contractual changes, credits, rate updates, or corrections affecting the invoice.
Time Tracking and Billing Accuracy
Time data is one of the most important inputs in a time-and-materials billing workflow. Customer Time Tracking provides a broader finance and business view of recording customer-related hours so organizations can connect employee activity with billable work, project performance, and invoicing.
Within Costpoint, finance teams can use approved project time to support billing calculations and investigate differences between recorded hours and amounts expected under the contract. Reviewing labor category, project, task, date, and approval status before billing helps maintain a clear audit trail.
Time And Billing Software generally connects time capture with billing and financial workflows. When these records are synchronized effectively, finance teams can move from approved activity to customer charges with fewer manual reconciliation steps.
Invoice Preparation and Financial Controls
After billable transactions are identified, the billing process should validate customer, contract, project, rate, and transaction information before invoices are finalized. Invoice controls are especially important when multiple projects, labor categories, billing rates, and cost types are active at the same time.
Invoice processing can also involve capture, extraction, validation, matching, GL coding, approval, and posting. The Invoice Software 2025: AI-Ready AP & Billing Guide. provides additional context on these invoice-processing stages and how they support accuracy and straight-through processing.
Procurement records can also affect the supporting evidence behind material charges. A purchase order can establish approved sourcing, purchasing controls, and spend visibility that help finance teams connect material transactions with the underlying procure-to-pay process.
From Billing to Cash Collection
Costpoint Time and Materials Billing does not end when an invoice is created. The billed amount enters the receivables process, where payment status, customer communications, deductions, and cash application determine how quickly billed revenue becomes collected cash.
collections workflows can prioritize customer follow-ups, payment promises, and dunning activities based on receivable status. Similarly, cash application connects customer payments and remittance information to outstanding invoices so receipts can be posted accurately and unapplied balances can be cleared.
For organizations seeking broader receivables automation, AR Automation Software can automate collection follow-ups and payment-to-invoice matching, with the stated objective of reducing DSO by 40% and reconciliation cost by 80%.
The relationship between sales activity, invoicing, and downstream finance is also covered in Sync Sales to Cash, which explains how CRM and invoicing systems can unite sales, billing, and accounts payable workflows.
Costpoint Integration and Finance Automation
Time-and-materials billing often depends on data moving between project accounting, contracts, purchasing, invoicing, receivables, and the general ledger. Reliable integrations help maintain synchronized information across connected ERP and finance systems, supporting consistent transaction flow and financial reporting.
The Hyperbots Platform applies agentic AI to finance and accounting tasks, including document processing and ERP integration. In a Costpoint environment, automation can support connected workflows around billing inputs, receivables, cash application, and related finance processes.
For customer receipts specifically, How Hyperbots AI Agents 10x Deltek Costpoint Finance discusses workflows involving customer payment matching, remittances, unapplied cash, deductions, and receipt posting, which are important downstream activities after billing.
Best Practices for Costpoint Time and Materials Billing
Finance teams can improve billing consistency by maintaining accurate contract and rate configurations and establishing clear approval controls for project transactions.
- Validate labor categories, project assignments, and billing rates before billing runs.
- Review approved time and eligible material transactions against contract terms.
- Maintain clear documentation for rate changes, billing adjustments, and contract modifications.
- Reconcile billed amounts with project transactions and receivables after invoice generation.
- Monitor collections, payment application, deductions, and unapplied cash after invoices are issued.
- Keep ERP and connected finance systems synchronized so billing and accounting records remain consistent.
Summary
Costpoint Time and Materials Billing converts approved project labor, materials, and other eligible costs into customer charges using configured billing rates and contract rules. Effective management requires accurate time tracking, validated project transactions, controlled billing calculations, reliable invoice processing, and connected receivables workflows. When these activities work together, organizations can improve billing accuracy, maintain stronger financial reporting, and support predictable cash flow from project-based revenue.