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Monitor project progress and performance

The work in process (WIP) feature lets you estimate the financial value of ongoing projects in the general ledger.

As a project progresses, materials and resources are consumed and expenses incurred that you must post to the project. In many cases, you might post expenses for a project before invoicing. But if you only post expenses, your financial statement is inaccurate. To track the actual value of the project, calculate WIP and post it to the general ledger. The following are the standard WIP methods:

  • Cost value
  • Sales value
  • Recognizable cost
  • Percentage of completion
  • Completed contract

You can also create a WIP method that meets the needs of your organization and set it as the default. Learn more at Understanding WIP Methods.

If you want to view the result using a different method, change the method and recalculate WIP. You can recalculate WIP as often as you like. The value isn't automatically posted to the general ledger. After you calculate WIP using the method you prefer, you can post to the general ledger.

  1. Select Search (Alt+Q) in the upper-right corner, enter Project WIP Methods, then choose the related link.
  2. Choose the New action, and then fill in the fields as necessary. Hover over a field to read a short description.
  3. Close the page.
  4. To make this new method the default, select Search (Alt+Q) in the upper-right corner, enter Projects Setup, then choose the related link.
  5. In the Default WIP Method field, choose the method from the list.

Define a WIP method for a project

When you create a new project, you must specify which project WIP method applies. In some cases, the project WIP method you use is already set as the default.

  1. Select Search (Alt+Q) in the upper-right corner, enter Projects, then choose the related link.
  2. Choose the New action. Learn more at Create Projects.
  3. On the Project Card page, in the WIP Method field from the Posting FastTab, select a WIP method from the list. If a default method is defined, you can select another option if needed.

Define a WIP method for a project task

You can define a WIP method for a project task, exclude project tasks from WIP calculation, or group tasks to be calculated together.

If you want to calculate WIP for each project task individually, WIP posting provides defined dimensions for the specific tasks.

The WIP-Total specifies project tasks you want to group together when calculating WIP and recognition. In any group of tasks, there needs to be one task that satisfies two conditions:

  • WIP-Total is set to Total. If there are no project tasks with WIP-Total set to Total, Total is set automatically on the last project task line when WIP is calculated for the first time.
  • The number in the Project Task No. field is the final one in the group or range of project tasks.

The following table describes the options:

Field Description
<blank> Leave blank if the project task is part of a group of tasks.
Total Defines the range or group of tasks included in the WIP and recognition calculation. Within the group, any project task with Project Task Type set to Posting is included in the WIP total, unless the task's WIP-Total field is set to Excluded.
Excluded Applies only to a task with Project Task Type of Posting, in which case the task isn't included when WIP and recognition are calculated.

In the following example, project tasks are divided into two WIP total groupings, demonstrating how the WIP-Total field works:

Project task no. Description Project task type WIP-Total field
1000 Preparation Begin-Total <blank>
1010 . Cleaning Posting Excluded
1099 Total preparation End-Total <blank>
1100 Carpeting Begin-Total <blank>
1110 . Gluing floor Posting Excluded
1120 . Laying out carpet Posting <blank>
1199 Total carpeting End-Total <blank>
1200 Finish Begin-Total <blank>
1210 . Vacuum cleaning carpet Posting <blank>
1299 Total finish End-Total Total
1300 Error correction Begin-Total <blank>
1310 . Error correction Posting <blank>
1399 Total error correction End-Total Total

You notice:

  • For 1000 through 1299, WIP is calculated separately for this group of project tasks. Note, however, that two of the tasks, 1010 and 1110, are excluded from the WIP calculation because their project task type is Posting.
  • For 1300 through 1399, WIP is calculated separately for this group of project tasks.

Calculate WIP

You can determine the WIP amount to post to balance sheet accounts for the period end reporting by using the Project Calculate WIP batch job.

  1. Select Search (Alt+Q) in the upper-right corner, enter Project Calculate WIP, then choose the related link.
  2. Choose the Calculate WIP action.
  3. On the Project Calculate WIP page, fill in the fields as necessary.
  4. Choose the OK button.

Note

The batch job only calculates the WIP. The job doesn't post it to the general ledger. To post WIP, run the Post WIP to G/L batch job after you calculate the WIP. Learn more in the following procedures.

Review warnings

If your WIP calculation results in a message such as WIP was calculated with warnings, you might want to review the warnings.

  1. Select Search (Alt+Q) in the upper-right corner, enter Project WIP Cockpit, and then choose the related link.
  2. Select the project for which you want to review warnings. The WIP Warnings toggle is enabled for projects that have WIP warnings.
  3. Choose the Show Warning action.

Delete WIP entries

If you want to try different WIP methods, you might get an error message like, The Project Task cannot be modified because the project has associated project WIP entries. To be able to check WIP method, delete existing WIP entries.

  1. Select Search (Alt+Q) in the upper-right corner, enter Project WIP Cockpit, and then choose the related link.
  2. Select the project for which you want to delete WIP entries.
  3. Choose the Delete WIP Entries action.

Post WIP

When you calculate WIP, you can post it to balance sheet accounts for the period end reporting. Use the Project Post WIP to G/L batch job.

  1. Select Search (Alt+Q) in the upper-right corner, enter Project Post WIP to G/L, and then choose the related link.
  2. On the Project Post WIP to G/L page, fill in the fields as necessary.
  3. Choose the OK button.

Calculate and post project completion entries

After you complete all activities for a project, including posting usage and invoicing, you must update the project's status to Completed. Then, you must reverse any WIP that was posted to the general ledger.

  1. Select Search (Alt+Q) in the upper-right corner, enter Projects, then choose the related link.

  2. Select an open project, and then choose the Edit action.

  3. On the Posting FastTab, in the Status field, select Completed.

  4. Follow the assistance steps to calculate and post the WIP, or follow steps 5 and 6 to do so manually.

  5. Choose the Calculate WIP action.

  6. On the Project Calculate WIP page, fill in the fields as necessary.

    The project WIP entries created by running the batch job have the Project Complete checkbox selected to show that they're completion entries.

  7. Choose the Post WIP to G/L action.

  8. On the Project Post WIP to G/L page, fill in the fields as necessary.

    The project WIP general ledger entries created by running the batch project have the Project Complete checkbox selected to show that they're completion entries.

WIP fields on the Project Card page

After you calculate WIP and post it to the general ledger, several fields on the Project Card page update to reflect the current WIP position. You can review these fields in the WIP/Recognition FactBox on the page.

How the fields update

WIP fields come in pairs of an amount field and a G/L amount field. For example, the Total WIP Cost Amount and Total WIP Cost G/L Amount fields. They reflect the two-step WIP process:

  1. The Calculate WIP action creates WIP entries. The amount fields show the calculated values.
  2. The Post WIP to G/L action posts the entries to the general ledger and removes the WIP entries. The amount fields reset to zero, and the G/L amount fields show the posted values.

WIP cost and sales fields

The following table describes the fields related to WIP cost and sales.

Field Description
Total WIP Cost Amount The calculated WIP cost that isn't yet posted to the general ledger. Resets to zero after posting.
Total WIP Cost G/L Amount The WIP cost that was posted to the general ledger.
Applied Costs G/L Amount The sum of applied cost entries posted to the general ledger that are related to the project.
Total WIP Sales Amount The calculated WIP sales that aren't yet posted to the general ledger. Resets to zero after posting.
Total WIP Sales G/L Amount The WIP sales that were posted to the general ledger.
Applied Sales G/L Amount The sum of applied sales entries posted to the general ledger that are related to the project.

Recognized revenue and cost fields

The following table describes the fields related to recognized revenue and costs.

Field Description
Recog. Sales Amount Revenue recognized to date, based on the WIP calculation.
Recog. Sales G/L Amount Revenue recognized and posted to the general ledger.
Recog. Costs Amount Costs recognized to date, based on the WIP calculation.
Recog. Costs G/L Amount Costs recognized and posted to the general ledger.
Calc. Recog. Sales Amount The sum of recognized sales amounts from all project tasks.
Calc. Recog. Costs Amount The sum of recognized costs amounts from all project tasks.
Calc. Recog. Sales G/L Amount The sum of recognized sales general ledger amounts from all project tasks.
Calc. Recog. Costs G/L Amount The sum of recognized costs general ledger amounts from all project tasks.

WIP status fields

The following table describes the fields related to WIP status.

Field Description
WIP Entries Exist Whether WIP entries exist for the project, indicating that Calculate WIP was run but Post WIP to G/L wasn't.
WIP Completion Calculated Whether the final WIP calculation was performed with the project marked as complete.
WIP Completion Posted Whether the final WIP completion entries were posted to the general ledger.
WIP Warnings Whether there are WIP calculation warnings for the project.

Review project ledger entries

All project-related entries are recorded in project registers and sequentially numbered, starting with 1. From the project register, you can get an overview of all project ledger entries.

  1. Select Search (Alt+Q) in the upper-right corner, enter Project Registers, and choose the related link.
  2. Select a relevant register, and then choose the Project Ledger action.

On the Project Ledger Entries page, you can review the entries that are associated with any project.

Walkthrough - Calculating Work in Process for a Project
Project management analytics overview
Managing Projects
Managing Inventory Costs
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Sales
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