WIP and Debtors - An Introduction

Last modified 08:04, 24 Apr 2017

Overview

Understanding the concepts of WIP and debtors is fundamental to managing the billing process for any practice. When a practice undertakes to perform work for a client, any time spent or expenses incurred while working on client assignments is recorded in order to generate an invoice for that client. These timesheet and expense sheet entries and their equivalent monetary value allow a practice to keep track of and report on financial information related to client work and business practices.s it.

WIP

Work in progress or ‘WIP’ as it is commonly known, is considered any work or out-of-pocket expense recorded in the system (either as time or an expense) that has not yet been billed to the client.

Client WIP can be divided into two different types:

  • Unposted
    When time and expenses sheets are entered, submitted or authorised, client WIP is saved in the system. This is unposted WIP and is displayed at the point of billing so that an accurate estimate can be made for interim bills.

  • Unbilled
    Posted time and expenses are recorded in the WIP ledger and available for billing. This is unbilled WIP.

Debtors

Once an invoice has been posted from outstanding WIP, the billed amount is then moved from WIP into debtors. Once you have received payment from the client in response to the invoice, you then enter the receipt of payment into the system.

See below for a workflow diagram on WIP and Debtors:

Workflow diagram of WIP and Debtors

 

Viewing WIP

A detailed breakdown of WIP is available on screen at the point of billing. However, there are a number of ways WIP can be analysed prior to billing if required. See Viewing client WIP for more information on how to view WIP.

Related

Page statistics
1015 view(s) and 3 edit(s)
Social share
Share this page?

Tags

This page has no custom tags.
CCH Practice Management

Comments

You must to post a comment.

Attachments

 

 | Cookie Policy | Copyright | Privacy Policy Terms of Use | Contact Us |