We recently lost a long term employee who performed our job completions, and there were no written procedures for his job responsibilities. So I am attempting to learn the criteria for job completions. If I complete jobs today but date them with the actual completion dates in February what impact, if any, will this have on our month end financial reports for February? Or should I just use today’s date for the completion date and allow it all to work out at the end of March?
completion shouldn’t effect anything financially, that’s more of a closing function I believe.
Rob is correct per usual. Completion takes it out of the schedule. Closing clears WIP and recognizes variances.
So does the closing date have an impact on the financials?
Yes. The close date becomes the apply date if I recall correctly.
My boss is concerned that the month end reports (like the WIP report and any other “real time” reports) will not be accurate if we complete and close jobs today and date them for February. Should that be a concern?
Sure. You need to work out the timing between finance and operations. But if the job indeed closed in February, your “real-time” reports aren’t that accurate, are they?
One option is to close the job in March and have Finance put in an accrual to cover the costs of the jobs that should have been closed in February to make the G/L correct for February. When the accrual reverses in March then the jobs closed in March will zero out.