This type of grouping is most typically identified as a user defined field on the Project Table and may be named however required. This field can be used to create a tree-like display on the project select list when inserting a new line item on a timesheet. An example of this would be a company who has a lot of projects that are associated to a specific client. Being able to choose the client first and then the project makes it easier for an employee to select the appropriate project, when completing their timesheet.
The setup of the tree field for the project table is completed on the Administration / System Preferences tab. For the Project tree structure, select the filed you wish to use for grouping by using the dialog box. If you wish, you can choose multiple fields and have a multi-level display.