Agencies sell time and expertise, but their books are often dominated by money that is not really theirs: client ad spend, printing and media purchases passed through at cost or with a small markup. When that money is mixed with fees, revenue looks bigger than it is and margins look smaller. Agency bookkeeping separates the two.
Agency revenue versus pass-through costs
We record management fees, retainers and project fees as agency revenue, and track reimbursable media and production costs in their own accounts. Reports then show gross revenue, pass-through costs and the net revenue the agency actually earns.
Retainers and project billing
Retainers billed in advance, milestone billing on projects and hourly billing each need different treatment. We keep unbilled work and advance billings visible so monthly results are accurate.
Freelancers
Most agencies rely on freelancers. We code their costs to clients or projects and collect a Form W-9 from each one, so year-end Form 1099-NEC filing is straightforward.
Project profitability
With costs coded to clients, we can report margin by client and project, and compare it with the time your team logged.
What our agency support covers
- Revenue split between fees and pass-through costs
- Retainer and project billing reconciliation
- Freelancer cost tracking and 1099 records
- Client profitability reports
See our accounting services or our page on professional services firms.
Profit by client
An agency can grow revenue while losing money on its largest accounts. When time, contractor costs and media rebills are tracked by client, the books show which retainers are profitable and which need repricing or a narrower scope. That analysis is the basis of most pricing conversations with clients.
We also separate contractor costs from payroll so you can compare the true cost of freelancers and staff.
