Entering personnel Follow

The entries you make on the Personnel page of your forecast will give you an opportunity to think through your staffing needs, both now and in the future. The way you represent your staff in the forecast is very flexible. You may wish to list every employee by name or title, or you can also create group entries representing common roles or departments if that makes more sense.

Note: If you have no paid employees (as in an all-volunteer nonprofit group, for example), just skip this step.


You can add employees as either direct labor or regular labor. Use the direct labor option only for personnel whose salaries are directly related to your revenue. The regular labor option is for staff whose salaries are part of your overhead expenses. For more details, see What is the difference between direct labor and regular labor?

You can also add employees as either on-staff employees or contract workers. You'll pay taxes for on-staff employees, but not for contract workers. As you add on-staff employees, their related tax expenses (also known as the Burden rate) will be calculated automatically to your financial statements.

Note: If you are a one-person business, remember to include a salary for yourself. 


Where does this entry appear in the financial statements?

Regular labor and direct labor entries appear in two different locations on the Profit and Loss, because they calculate into your margin differently. A regular labor entry will calculate into Operating Expenses, as shown below:


A direct labor entry, on the other hand, will calculate into Direct Costs, as shown below. For an animation showing how to locate your direct labor in the P&L, see How do I locate my salaries and wages in the Profit and Loss?


In the Balance Sheet, your personnel entries calculate as a negative number in your Assets. And then, because the Balance Sheet always has to be in balance, this value will also appear in the Liabilities and Equity portions of the table. In the example below, the forecast contains only two personnel entries (one regular labor and one direct labor), to more clearly represent where it appears in the calculations:


In the Cash Flow table, your personnel entries are calculated into the lines below:



More on personnel:

Was this article helpful?
0 out of 0 found this helpful
Have more questions? Submit a request