For finance teams managing capital expenditures, labor costs are the hardest line item to track. While capex software handles equipment and facilities, many organizations struggle to document which hours qualify as capitalizable work versus opex.
This guide covers what capex tracking involves, why labor classification matters, and how to build tracking processes that produce audit-ready records for capital expenditure planning.
What is CapEx tracking?
CapEx tracking is the process of recording and analyzing capital expenditures—funds spent on assets that benefit the business for more than one year. Unlike operating expenses that hit the income statement immediately, capital investments appear on the balance sheet and depreciate over their useful life.
Effective capex management involves monitoring spending on acquiring or maintaining long-term assets. For many organizations, this includes significant labor: hours engineers spend building software, time teams dedicate to project execution, or work required to deploy new systems.
The challenge? Most capex software focuses on equipment. Labor costs—often the largest capitalizable expense—get tracked in spreadsheets, ERP systems, or not at all.
Why labor costs make capex tracking challenging
Every business approaches labor cost capitalization differently, creating problems for budget management and stakeholder engagement:
Data lives in multiple systems. Project management tools track tasks. Payroll captures hours. ERP software like SAP or Oracle handles reporting. Without integration, reconciling labor spend against project budgets and capex planning requires manual work—and manual processes enable errors.
Forecasts rarely match actuals. Your capital expenditure planning might assume a developer spends 85% on capitalizable work. If they actually spend 70%, your records must reflect reality. Many tracking processes don't capture this variance.
The approval process breaks down. When stakeholders can't access real-time labor costs against budget, approval workflows become reactive. Capital projects exceed budget before anyone can determine the variance.
How to track CapEx effectively
Successful CapEx tracking for labor requires clear classification rules, accurate time records, and reporting that finance teams can trust. The right capex software makes this possible.
Classify expenditures at the right level
Organizations approach capex management and capex planning differently:
Person-level sets targets for each employee's capitalizable activities. This helps forecasts but doesn't capture actuals.
Project-level provides broader control. Every hour logged to a capitalizable project gets the CapEx designation—useful when entire project initiatives qualify.
Task-level offers granular insights and detailed records stakeholders expect.
Many organizations implement multiple levels to gain the benefits of each.
Capture data without adding friction
Effective capex tracking depends on systems that let administrators configure labor classification rules while keeping data entry simple for employees. These systems should capture finance-ready labor data automatically at the moment of entry, before it flows into capex or ERP software.
Enable real-time reporting
Capital expenditure tracking depends on accurate labor data upstream:
- Budget vs. actual shows whether labor spend aligns with your budget and capex planning
- ROI analysis helps determine which project investments justify allocated funds
- Audit-ready exports streamline compliance reviews
When finance, project management, and technical teams access the same data, collaboration improves and stakeholder engagement focuses on strategy.
How ClickTime supports labor CapEx tracking
ClickTime helps organizations track labor costs for capital expenditures. Rather than replacing your capex software or ERP system, ClickTime captures categorized labor data that many platforms handle poorly.
Flexible classification. Create custom fields at person, project, or task levels. These fields stay hidden from employees, keeping timesheets simple while capturing the data finance needs.
Built-in analytics. ClickTime's Report Studio analyzes targets vs. actuals, tracks CapEx and OpEx hours, and identifies capitalizable labor percentages.
Audit-ready documentation. The approval process and audit trail record every entry and submission. Timesheet attestation provides accuracy control for compliance.
ERP integration. ClickTime connects with SAP, Oracle, and other software platforms, enabling teams to incorporate labor data into capital expenditure management without double entry.
How to track CapEx delivery
Tracking CapEx delivery—monitoring whether investments achieve outcomes—requires visibility into both spending and project execution. Connect capex tracking data with project milestones. When stakeholders see labor burn against deliverables, conversations shift to strategic insights about ROI and efficiency.
One big part of the CapEx budget on our side is people: people working on operations, on maintenance, and on development of new features. We follow our budget thanks to ClickTime. So that's why it's a very central solution for us." — IT Director, Global Facilities Management Spin-Off
Get accurate labor data for your CapEx tracking
If your organization capitalizes labor costs for software development, R&D credits, or major initiatives, accurate tracking is the foundation of compliance.
ClickTime helps finance teams capture labor data for capital expenditure classification—with custom fields, approval workflows, and audit-ready records.
