New AM in audit here. Can someone explain me the concept of monthly wip and billings done in easiest way? My manager used some words which went above my head - provision , write off, wip, production costs, cost to complete, cost to period end. I understood some stuff but i don’t think i can explain it to some or do it myself at the moment! Thanks

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Easiest way would have been to tell your manager that you don’t understand and need more clarification on these items.

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That is me being helpful. You are an adult in a professional environment. If you don’t know or understand something then you should ask.

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Assuming your audit is for a fixed fee (which is usually the case), you are performing percentage of completion accounting. This requires both gathering information on actual hours incurred to date, and estimating remaining hours needed to finish the audit. After you have that information, you then need to recognize whatever cum catch adjustment needed to get to your project to date percentage completed. Write offs and other fancy words are just terms to explain the cumulative catch adjustment in the current period. I agree with others…don’t be shy about asking questions directly to your managers and partners. We’ve all been there in the past. (And if someone tries to brush you off it says more about them than you.)

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Think of every engagement as a mini PL. charge an hour book revenue and receivable and cost of good lsold. Bill and collect reduce your receivable. When you think that you will charge more than you will collect book a reserve.

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