We have a client who wants to use project accounting in a somewhat unconventional manner. The client is using projects account to track manufacturing WIP and progress billing. The client did not buy either Distribution or Manufacturing as they are using a 3rd-party solution for these features.
They want to have the ability to use progress billing, but because they recognize revenue by the “completed project” method, they need to post their billings deferred revenue. Using a WIP schedule for this is not ideal for this client.
The plan was to allow them to generate progress billing on demand, posting the credit side of the invioce to Deferred Revenue, then use the allocation feature at the end of the job to reclassify the Deferred Revenue, along with their WIP, to revenue and COGS, respectively.
I tried using a different methodology, where they generated progress billings, then offset the final bill with the sum of their progress billing to request the final amount due while recognizing the revenue, but it was a little rough for them to follow.
Ideally, we’d like to see the progress billing to date be included in the revenue budget, regardless of the account to which the billing is posted so that the client can track jtd billing.
Wondering if other folks have encountered this type of requirement and how you met it. It’s a bit odd, but I feel like there has to be a solution for this.
The client does not have the Deferred Revenue module, but I wouldn’t think that it would be a fit anyway.