Project Profitability Analysis

PeopleSoft Project Costing enables you to analyze profit margins for individual projects. You can view actual profitability trends, profitability details, and the top 10 profitable projects.

Actual profitability trends are displayed in a graph format and in a grid. You enter two periods to compare and analyze values such as the actual revenue amount, the actual cost amount, the actual margin, and the actual margin percent for the period.

Profitability details include revenue, cost, budget, margin, and margin percent at the project level, and you can drill down to details at the activity level.

The top 10 profitable projects are displayed in a graph format and in a grid. You can display the 10 projects with the highest actual margin percent in descending order.

You need to understand these terms when analyzing profit margins:

Term	Definition
Profit Margin	Also referred to as profit, margin, or net income. Profit margin is a measure of profitability. It is calculated as revenue – cost. Profit margin is primarily used for internal comparison. Business entities typically have different levels of expenditure due to individual operating and financing arrangement. Therefore, comparing one with another can have little meaning.
Margin	This is the same as profit margin.
Margin Percent	This is the ratio between profit margin and revenue. It is displayed as a percentage. Margin percent is an indicator of an organization's pricing policies and its ability to control costs.