> ## Documentation Index > Fetch the complete documentation index at: https://usepike.com/docs/llms.txt > Use this file to discover all available pages before exploring further. # Profitability > How Pike calculates earnings, cost, and profit on finance cards and charts. Profitability compares **earnings** to **cost** and reports **profit** as the difference. On workspace and project Finance Overview, earnings are **recognized revenue**. Available to **admins, managers, and finance** users. ## Where to find it | Location | Scope | | - | - | | **Finance → Overview** | Whole workspace | | **Project → Finance** | Single project | Both surfaces show the same six cards and a cumulative chart. See [Finance overview](/docs/finance/overview) and [Project finance](/docs/project/project-finance) for the cards themselves. ## The core formula On those cards and charts: ``` earnings = recognized revenue profit = recognized − cost ``` Totals at the top of the profitability card are the sum of monthly data points in the selected range. | Field | Meaning | | - | - | | **Earnings** | Recognized revenue attributed to that month | | **Cost** | Internal cost attributed to that month | | **Profit** | Earnings minus cost | Recognized is resolved per project (method, then any monthly override) and rolled up. Changing a project's recognition method moves earnings and profit. See [Revenue recognition](/docs/finance/revenue-recognition). > [!NOTE] > > **Worked revenue** (hours × assignment rate) is a dashboard metric and the > input to average billing rate. It is not the earnings number on the Finance > Overview cards. ## Planned comparison The cumulative chart also plots **planned** profitability from [resource allocations](/docs/allocation/allocation-properties): ``` planned earnings = allocated hours × task assignment rate planned cost = allocated hours × (employment hourly cost + hourly overhead) ``` * Allocations are clipped to calendar month boundaries. * Hours per day come from the allocation's weekday schedule (Monday–Sunday minutes). * Only allocations whose date range overlaps the filter are included. Planned answers: *"If we deliver what is currently on the schedule, what profitability should we expect?"* It is a comparison line, not a second mode for the six cards. ## Customer finance On a **customer** finance page you can switch the profitability card between **recognized** earnings and **invoiced** earnings. That answers a different question (what we billed versus what it cost). Workspace and project Finance Overview cards always use recognized. ## How cost is built Total **cost** per month is: ``` cost = labor cost + overhead + qualifying expenses ``` That is the same **cost of delivery** used on the Cost card. ### Labor cost (employment contract) For each hour of work (logged or planned), Pike looks up the member's **employment contract** and derives an hourly employment cost from: | Contract frequency | Hourly employment cost | | - | - | | Hour | Cost amount directly | | Week | Cost amount ÷ hours per week | | Biweek | Cost amount ÷ (hours per week × 2) | | Month | Cost amount ÷ monthly working hours from contract | | Year | Cost amount ÷ yearly working hours from contract | **Monthly / yearly working hours** use business days (weekends excluded) and the contract's **hours per week**: ``` working hours = (business days ÷ 5) × hours per week ``` If a member has **no contract**, employment hourly cost is **0** for that member in profitability. Overhead may still apply if they are assigned overhead items. For how contracts feed hourly cost on member profiles, see [Cost profile](/docs/members/cost-profile). ### Overhead **Hourly overhead** from assigned [overhead cost](/docs/finance/overhead-costs) line items is added to the employment hourly cost: ``` loaded hourly cost = employment hourly cost + hourly overhead ``` See [Overhead costs](/docs/finance/overhead-costs) for allocation rules and the contract-based hours conversion. ### Expenses Project **expenses** add to cost when **either**: * the expense has **no project**, or * the expense is **not billable** Billable expenses linked to a project are **excluded** from profitability cost (they are treated as pass-through to the client, not internal cost). Expense cost uses `amount × exchange rate` and is grouped by **date incurred** month. ## Filters Profitability respects filters passed to the calculation. What you select determines which recognition rows, time entries, allocations, and expenses are included. ### Supported filters | Filter | Effect | | - | - | | **Date range** | Limits records to the period. If omitted on the API, the range is inferred from the data | | **Customer** | Only work / invoices / expenses linked to those customers | | **Project** | Only work / invoices / expenses on those projects | | **Team** | Only work on tasks belonging to those teams. For invoices and expenses, the project must be linked to the team | Filters combine with **AND** logic: a record must match every filter you set. ### Where filters appear in the product | Surface | Default filters | Notes | | - | - | - | | **Finance → Overview** | Date range (current year), optional customer / project / team | Also Proposed / Confirmed project stage | | **Project → Finance** | Fixed to the **current project** | No customer/team picker; scoped automatically | ## Date grouping and chart behaviour * Results are aggregated into **monthly** data points. * The cumulative chart stacks profit over time within the filtered range. * **Planned** profitability is always fetched alongside actuals for comparison on the chart. When you set a date range explicitly, that range is used. When you do not, Pike infers the range from recognition months, time entries, expenses, and (for planned) allocation dates. ## Revenue vs cost timing Recognized and cost can land in different months: | Number | Dated by | | - | - | | **Earnings** | The recognition month (method or override) | | **Cost** | Time entry **start** month, plus expense **incurred** month | An override or Time % restatement in March for January work will show earnings in March and labour cost in January. > [!TIP] > > When month-to-month profit looks off, check the project's recognition method > and any manual overrides on [Revenue > recognition](/docs/finance/revenue-recognition) before assuming cost is wrong. ## Access and permissions | Feature | Roles | | - | - | | View profitability endpoints | Admin, Manager, Finance | | Manage overhead (affects cost) | Admin | | Manage employment contracts (affects cost) | Admin, HR (contract management) | ## Prerequisites for accurate numbers Profitability is only as good as the underlying data. | Data | Affects | If missing | | - | - | - | | **Recognition method** | Earnings on finance cards | Earnings follow the wrong formula | | **Task assignment rate** | Worked method and planned | Earnings = 0 for that work | | **Employment contract** | Labor cost | Labor cost = 0 for that member | | **Overhead assignment** | Loaded cost | Only base contract cost used | | **Completed time entries** | Actual cost and Time % / Worked | Open timers excluded | ## Example walkthrough **Setup** * Project recognizes by **Worked**. Developer logs **10 h** in March on a billable task at **£150 / h**. * Contract: **£6,000 / month**, 37.5 h/week → \~£36 / h employment cost. * Overhead share: **£2 / h**. * Loaded cost: **£38 / h**. * No manual override. **March** ``` earnings = 10 × £150 = £1,500 (recognized via Worked) cost = 10 × £38 = £380 profit = £1,120 ``` If the same project used **Time %**, March earnings would be that month's share of the revenue budget, not £1,500, while cost would stay £380. ## Related documentation > **[Finance overview](/docs/finance/overview)** > > Workspace cards, filters, and charts. > **[Revenue recognition](/docs/finance/revenue-recognition)** > > How recognized is calculated and overridden. > **[Overhead costs](/docs/finance/overhead-costs)** > > Shared expenses and how hourly overhead loads onto labor cost. > **[Cost profile](/docs/members/cost-profile)** > > Set member contracts, capacity, and hourly employment cost. 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