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in Fixed Price Project, On posting the estimates for FP Project system Debit the WIP-Invoiced on account A/C and Credit - Accrued Revenue - Sales Values A/C, but the accrued revenue account doesn't get settled on closing the project
Logically the accrued revenue amount should be reversed on posting the final invoice and it works perfectly well for Time and Material Project. In T & M projects, system posts accrual revenues on posting cost transactions and the same is reversed on posting project invoice, but in case of fixed price project with “On Account invoice posting – Balance” system doesn’t reverse revenue accruals. Also, WIP-Invoiced amount should be eliminated to P & L - Invoiced on-account on posting elimination.
Also, Project statement report – Profit and Loss tab doesn’t show revenue figures in “Invoiced revenue” or “Invoiced revenue – On account”, it shows revenues in Accrued Revenue – Sales Value field which is incorrect
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Category: Project management