Guide
Work in progress (WIP)
Work in progress is the value of work done but not yet invoiced. How consultancies measure it, and what it should keep apart.
In a consultancy, work in progress is the value of time and costs already spent on a job that have not been invoiced yet. It answers two questions: how much could we bill today, and is any job quietly running ahead of what the client has been charged.
A useful WIP figure prices each hour at the rate that applied on the day it was worked, not today’s rate. It also keeps apart three things that are easy to blur: time that was never chargeable, chargeable time somebody decided to write off, and chargeable time still waiting to be billed.
In ReliTime
ReliTime’s work-in-progress report prices approved hours at the rate in force on the day, shows non-billable time by reason, write-offs with who made them, and what is still unbilled, by job.
Related
Questions people ask
Is work in progress the same as revenue?
No. It is work that can be billed but has not been. It becomes revenue when it is invoiced, and some of it may be written off instead.
Why price WIP at the old rate rather than today’s?
Because that is what the client agreed to pay for the work when it was done. Re-pricing old hours at a new rate overstates what can actually be billed.
See it on your own kind of work
We set ReliTime up with a walkthrough rather than a sign-up form. We will take you through a working organisation, from a week of timesheets through approvals and work in progress to a GST invoice, answer your questions as we go, and set up yours.
Or write to hello@relitime.com.