Posting work in progress (WIP) [in-depth guide]
Guide contents: Overview | What posts | Setup | Posting WIP | Batch Detail Categories | Unposting WIP | What happens when WIP is posted | Transferred transactions | When to post WIP | Monitoring WIP | Out of WIP | Turn off WIP | Resources
Overview
Once enabled, users can go to the Post WIP to GL screen under the Accounting menu at month-end, to post WIP to the general ledger.
When the WIP posting routine is run, the system will look at transactions in billable projects and post GL entries into the specific WIP accounts. WIP postings will only apply to billable projects. Non-billable projects, billable projects with Setup > Accounting: 'do not post to WIP' checked, and projects associated with a retainer are excluded from WIP posting. WIP transactions are posted based on the following:
- If the transaction is unbilled and has not been posted into WIP, then it will be posted to the WIP account(s).
- If the transaction was posted into WIP and is now billed, then it will post out of WIP.
- Transactions that were not posted into WIP previously and were billed before you post WIP will be excluded from WIP posting.
- NOTE: Labor that is written off before posting to WIP will post to GL by debiting the WIP labor write-off account & crediting the WIP agency time adjustment account.
Expense reports themselves do not post into WIP (much like POs do not affect WIP). However, when you convert the expense report to a vendor invoice, it will post into WIP, just like misc costs, if it is approved & unbilled when posting WIP to GL.
Why is this important? Posting work-in-progress (WIP) to the general ledger is a way to match revenue & costs to the same period if you are not billing actual labor worked and direct project expenses at the end of each month. This allows you to normalize your corporate profit & loss statement so that revenue & related costs are tied in the same financial period. Otherwise, you would see direct costs posted to your profit & loss statement in one period and then the related revenue posted in another period when it’s billed in that different period.
What posts to WIP and what does not?
Transactions that will post to WIP?
The following approved transactions that have not been included in a client invoice, marked as billed will be posted to WIP:
- Labor
- Vendor invoices: converted expense reports, purchase item-based invoices, and media item-based invoices
- Misc cost
- Media invoices
NOTE: When posting WIP, once a transaction is billed, marked as billed, or marked as write off, restrictions may be placed on the transactions that prevent further editing.
Transactions that will NOT post to WIP?
The following transactions will NOT be posted to WIP:
- Expense report
- Purchase order
- Media order: insertion order, broadcast order
- Production vendor invoices tied to pre-billed orders
- Any transaction associated with non-billable projects or retainer-linked projects (where the services/items are included in the retainer setup)
- Any transactions associated with a billable project where setup: Accounting tab > 'do not post to WIP' box is checked
- Any transactions not associated with a client or client project
- Any transaction associated with an opportunity project (oppty-xx project numbers)
Setup
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GL accounts - set up your WIP asset accounts via Workamajig > Admin/manager > System setup> GL setting > GL accounts.
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WIP tracking - you must turn on WIP tracking via Workamajig > Admin/manager > System setup > GL settings > GL tracking options > Track WIP in GL.
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Define WIP accounts - you must define which accounts to use for the WIP posting routine via Menu > Admin > System setup > GL settings > GL tracking options > Work in progress tracking. This area will not be visible until WIP tracking is turned on in step 2.
NOTE: The account numbers & names as shown below are based on the Workamajig defaults. If you have adjusted your GL accounts, the following may not match your current setup.
NOTE: All WIP Asset accounts should be different.
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Allow undo write-off - check the box if you need the ability to make transactions billable that was previously marked as 'write-off'. If left unchecked, once WIP is posted, the write-off transactions will be locked from further editing.
Posting WIP
To post work in progress go to Workamajig > Accounting > Today accounting> Items needing attention: Post work in progress:
Click on Post work in progress
Select the Posting date
Select the Transactions through date
Enter a Posting comment
Click POST
Once you have posted, the batch will appear to the right under the Posted batches. To see the detail of what was posted click on the Batch line
Example of the batch details.
Clicking on a line within the batch, will drill down tot he transaction details.
Batch Detail Categories
The details will be grouped into the following categories:
LABOR
WIP LABOR IN: Unbilled & approved time entries
WIP LABOR BILL: Labor that was billed in the period after a previous WIP batch posting.
WIP LABOR MB: Labor that was 'marked as billed' in the period after a previous WIP batch posting.
WIP LABOR IN/WO: Labor that was marked 'write off' in the period after a previous WIP batch posting
MISC COST
WIP MISC COST IN: Unbilled misc costs
WIP MISC COST BILL: Misc cost that was billed in the period after a previous WIP batch posting.
WIP MISC COST MB: Misc cost that was 'marked as billed' in the period after a previous WIP batch posting.
WIP MISC COST IN/WO: Misc cost that was marked 'write off' in the period after a previous WIP batch posting
VENDOR INVOICE
WIP VOUCHER IN: Unbilled & approved vendor invoice
WIP VOUCHER BILL: Vendor invoice that was billed in the period after a previous WIP batch posting.
WIP VOUCHER MB: Vendor invoice that was 'marked as billed' in the period after a previous WIP batch posting.
WIP VOUCHER IN/WO: Vendor invoice that was marked 'write off' in the period after a previous WIP batch posting
NOTE: The system will search through all transactions and find the ones that occurred based on the 'through date' you entered. The posting entry will be made as of the posting date you entered.
Unposting WIP
Once you have posted WIP, this will "lockdown" transactions that are associated with the WIP posting. To unpost WIP you must work backward through each WIP posting to get to the correct time period. Ex. It is July, I need to edit March. You must unpost July > June > May > April > March, in this order. You will then repost WIP March > April > May > June > July; making sure that the correct 'posting date' & 'transaction through date' are selected for each posting.
To unpost a WIP period:
1. Select the line associated with the most recent posting date.
2. Click Unpost
3. Confirm you want to Unpost, which will delete the batch and put the transactions back to being editable as before.
What happens when I post WIP?
Below demonstrates what occurs when posting work in progress.
NOTE: Labor that is written off before posting to WIP will post to GL by debiting the WIP labor write-off account & crediting the WIP agency time adjustment account.
Labor Posting
| Debit | Credit | |
| WIP agency time (asset) | X | |
| WIP agency time Adj (income) | X |
| Debit | Credit | |
| WIP agency time adjustment (income) | X | |
| WIP agency time (asset) | X |
| Debit | Credit | |
| Labor write off (contra income) | X | |
| WIP agency time (asset) | X |
Default Labor WIPGL Account
Labor: Prior to billing cycle
Posting Detail
WIP Analysis
Corp P&L
NOTE: unbilled labor is tracked to an 'other income account'.
Balance Sheet
NOTE: the unbilled time posted to a 'current asset account'
Trial Balance
Labor following billing cycle
Posting Detail
NOTE: The transaction transfer shows a 'marked as billed' amount and a 'labor in' amount. This is due to the original transaction. The transaction from the original project needs to be cleared from that project on the "date of transfer" to keep the Project/client P&L reports accurate.
WIP analysis
All transactions have posted out of WIP other than the transferred transaction that remains 'unbilled' but in a new project.
Corp P&L
NOTE: $135 was billed: $405 is reversed out of the 'other income account'. This leaves a balance of $135 in the 'other income account' as the transfer transaction remains 'unbilled'.
Balance Sheet
Trial Balance
More examples
Vendor Invoices Posting
| Debit | Credit | |
| WIP production expenses (asset) | X | |
| ITEM expense account (COGS) | X |
| Debit | Credit | |
| ITEM expense account (COGS) | X | |
| WIP production expenses (asset) | X |
| Debit | Credit | |
| WIP production write off (COGS) | X | |
| WIP production expenses (asset) | X |
Misc Costs Posting
| Debit | Credit | |
| WIP other expenses (asset) | X | |
| Rebillable expenses (income) | X |
| Debit | Credit | |
| Rebillable expenses (income) | X | |
| WIP other expenses (asset) | X |
| Debit | Credit | |
| WIP expense write off (COGS) | X | |
| WIP other expenses (asset) | X |
Media Vendor Invoices Posting
| Debit | Credit | |
| WIP media invoice accrual (asset) | X | |
| ITEM expense account (COGS) | X |
| Debit | Credit | |
| ITEM expense account (COGS) | X | |
| WIP media invoice accrual (asset) | X |
| Debit | Credit | |
| WIP media write off (COGS) | X | |
| WIP media invoice accrual (asset) | X |
Summary Posting
| Debit | Credit | |
| LABOR: WIP agency (asset) | X | |
| VENDOR INVOICE: WIP production expenses (asset) | X | |
| MISC COST/EXP RPT-BASED VENDOR INVOICE: WIP other expenses (asset) | X | |
| MEDIA VENDOR INVOICE: WIP media invoice accrual (asset) | X | |
| LABOR: WIP agency time Adj (income) | X | |
| VENDOR INVOICE/EXP RPT-BASED VENDOR INVOICE: ITEM expense account (COGS) | X | |
| MISC COST: Rebillable expenses (income) | X | |
| MEDIA VENDOR INVOICE: ITEM expense account (COGS) | X | |
| Debit | Credit | |
| LABOR: WIP agency time adjustment (income) | X | |
| VENDOR INVOICE/EXP RPT-BASED VENDOR INVOICE: ITEM expense account (COGS) | X | |
| MISC COST: Rebillable expenses (income) | X | |
| MEDIA VENDOR INVOICE: ITEM expense account (COGS) | X | |
| LABOR: WIP agency (asset) | X | |
| VENDOR INVOICE: WIP production expenses (asset) | X | |
| MISC COST/EXP RPT-BASED VENDOR INVOICE: WIP other expenses (asset) | X | |
| MEDIA VENDOR INVOICE: WIP media invoice accrual (asset) | X | |
| Debit | Credit | |
| LABOR: Labor write off (contra income) | X | |
| VENDOR INVOICE: WIP production write off (COGS) | X | |
| MISC COST/EXP RPT-BASED VENDOR INVOICE: WIP expense write off (COGS) | X | |
| MEDIA VENDOR INVOICE: WIP media write off (COGS) | X | |
| LABOR: WIP agency time (asset) | X | |
| VENDOR INVOICE: WIP production expenses (asset) | X | |
| MISC COST/EXP RPT-BASED VENDOR INVOICE: WIP other expenses (asset) | X | |
| MEDIA VENDOR INVOICE: WIP media invoice accrual (asset) | X | |
Transferred transactions
What happens when I transfer transactions to different projects?
When a transaction is transferred and you are posting WIP, to keep track of the transaction, the system will first post the transaction WIP xxx OUT in connection to the old project, then post the transaction WIP xxx IN, in connection to the new project. The transfer date is very important!! For transferred items in the new project, the date associated with it will be the transfer date. Please, ensure that the WIP posting and transfer date are in the same period. If you transfer into a different WIP posting period and bill the item, your WIP numbers may not tie out if looking at the individual project transactions.
To correct this, go to the old project:
1. go to Billing > toggle transaction status drop-down from Unbilled to Transferred.
2. Check boxes along the left side of screen >>click CHANGE TRANSFER DATE
3. Select the new "Posting date" >> click CHANGE TRANSFER/ADJ DATE
When to post WIP
Typically, WIP is posted once, at month's end after all client invoices & vendor invoices have been posted to the ledger. When WIP is posted, you will need to enter a 'posting date', a 'select transactions through date', and a 'posting comment'. The system will find all transactions that occurred through the 'through date' (even if they occurred in a prior period) and the posting entry is made as of the posting date. Posting entries are not made into past periods. It is a single entry on the specified posting date.
The recommended workflow is as follows:
- Approve all time & vendor invoices for the period
- Bill, mark billed, or mark write off all transactions for the period
- Post all client invoices & vendor invoices
- Post WIP
Once WIP is posted, the WIP entries will update the GL balances for the posting period.
NOTE: If you are posting WIP, you MUST Post WIP before running any of your monthly financial reports to ensure the accuracy of the reports.
Monitoring WIP
Workamajig > Everyone > Reports > Finacial reports > WIP analysis
The WIP analysis report provides a good overview of your WIP balances in each category, transactions that are approved but unposted to WIP, and details of WIP transactions. For full details view the topic WIP analysis report [in-depth guide].
Out of WIP
If you see "Out of WIP" next to a transaction, this is due to one of the following actions being taken after you last posted WIP:
- Billed on a client invoice.
- Marked as billed.
- Written off.
- Transferred to another project.
I no longer want to post WIP
If you want to discontinue using WIP and remove tracking WIP from Workamajig, you can simply unpost all WIP postings. Transactions will be adjusted accordingly. NOTE: This will affect your financial reporting. You will then go to Workamajig > Admin/manager > System setup > GL settings > GL tracking options: uncheck 'track WIP'
If you want to discontinue using WIP starting in the new fiscal year, you will need to turn off 'tracking WIP' via GL tracking options and create a journal entry/entries to move transactions from WIP asset accounts to COS accounts. You will also need to make sure the entries are associated with the appropriate project to ensure accurate reporting of costs towards the projects.