Time and expense in Dynamics 365 Project Operations

A services business runs on time. Every billable hour captured, every chargeable expense logged, every approval routed promptly converts into invoiced revenue. Time and expense in Project Operations is the operational layer that turns work into cash. The workflow has more friction than the buttons suggest; designing it well is the difference between clean monthly billing and an end-of-month scramble.

Time entry surfaces.

• Web entry — the daily or weekly timesheet in the model-driven app.
• Mobile app — Project Operations mobile for on-the-go entry.
• Microsoft Teams — embedded time entry in Teams chat or tab.
• Outlook — convert calendar events to time entries (with Premium).
• API / external — automated capture from project management tools.

The variety matters because different roles enter time differently — consultants in front of a laptop vs technicians on the road.

Time entry record.

• Project — what we're billing or charging to.
• Project task — finer breakdown.
• Role / billing type — Senior Consultant, Junior Developer (drives rate).
• Hours — duration.
• Date — when work happened.
• External description — visible to customer on invoice.
• Internal description — for project manager visibility.
• Billable flag — billable / non-billable / over-cap.

Billable vs non-billable. Not all time is billable. Reasons time is non-billable:

• Internal work — admin, training, all-hands meetings.
• Pre-sales activity — work before contract.
• Re-work — fixing our own mistakes; can't bill the customer.
• Over-cap — already exceeded the fixed-price budget; remaining work non-billable.
• Non-billable customer — internal projects.

The split matters for utilisation reporting: billable utilisation drives the firm's profitability, non-billable utilisation is overhead.

Approval workflow.

1. Resource submits the weekly timesheet (or daily depending on cadence).
2. Project manager approves project time.
3. Resource manager approves total time (sanity check on full week).
4. Approved time flows to billing and revenue recognition.

Approvals can be sequential or parallel; configuration determines flow. Most organisations use sequential: PM first, RM after.

Rejections. Approver can reject specific entries with feedback:

• Time entered on wrong project.
• Description insufficient (won't survive customer scrutiny).
• Hours implausible (16h day requires justification).

Resource adjusts and resubmits. Audit trail captures the back-and-forth.

Delegations. When approvers are out:

• Delegate approval to a backup.
• Configurable per-user out-of-office rules.
• Escalation if not approved within N days.

Without delegation, monthly close stalls during PTO.

Expense entry. Similar workflow to time but with additional structure:

• Expense category — meals, transport, hotel, equipment.
• Date and amount.
• Currency — multiple currencies; conversion at entry or at approval.
• Receipt attachment — photo or PDF.
• Billable to customer — pass-through or absorb.
• Project / task allocation.
• Payment method — corporate card, personal reimbursement, cash.

Expense policy enforcement.

• Per-category limits — meals capped at $50/day.
• Per-trip caps — total expenses for a trip ≤ $X.
• Receipt threshold — receipts required above $25.
• Pre-approval for high-value expenses (airfare > $1,000).
• Currency-specific rules — different limits per region.

Violations either block submission or flag for additional approval.

Corporate card integration. For expenses on corporate cards:

• Card transactions feed from the bank.
• Resource matches transactions to expense entries.
• Reconciliation per statement period.
• Outstanding (uncategorised) card charges escalated.

Without card integration, expense entry duplicates: enter expense, separately reconcile the corporate card statement. Painful.

Pass-through expenses. Expenses billed to the customer:

• Time-and-material contracts — pass-through at cost or with markup.
• Fixed-price — expenses usually absorbed.
• Cost-plus — pass through with markup percentage.

Configuration determines invoicing; expense lines on invoices need clear customer-facing descriptions.

Resource utilisation. Time data drives utilisation reporting:

• Billable utilisation — billable hours / total hours.
• Target utilisation — what the firm targets per role.
• Variance — over- or under-utilised resources.

A common pattern: senior consultants targeted at 70% billable, managers at 50%. Variance drives staffing decisions.

Integration with billing.

• Approved time and expenses flow to project actuals.
• Billing cycle (weekly, monthly) generates invoices from project actuals.
• T&M invoices list time and expenses; fixed-price invoices reference milestone amounts.

Common pitfalls.

• Late time entry. Resources don't enter weekly; monthly catch-up is unreliable.
• Approval bottlenecks. PMs delay approval; billing slips.
• Wrong project coding. Time on project X charged to project Y; revenue and cost misallocated.
• Receipts missing. Expenses without receipts; can't bill customer.
• Policy violations not enforced. Expense limits ignored; policy becomes decorative.
• Time entry friction. Cumbersome UI; resources avoid; data quality degrades.

Operational rhythm. Daily time entry by resources; weekly approval by PMs and RMs; monthly billing cycle pulls approved entries. The discipline matters — late or messy time entry pushes invoicing late, which pushes cash collection late.

Strategic positioning. Time and expense looks operational but is strategic — it's the most direct link between hours worked and revenue collected. Mature services organisations invest heavily in low-friction time entry, fast approval, and clean data; the payback in faster cash and accurate margins is significant. Treating time and expense as a chore — something agents resist and managers neglect — eventually costs the firm material money.