Project Evaluation and Activation (WIP)
WIP values are calculated for each sales line, which means on the level of the defined sales codes or on a higher level for a line which is marked as WIP Position. Another possibility is to calculate WIP independently from Job Lines while defining a separate WIP Job Line by using a general component. The calculation uses the information from the data sources described in the following table.
|Calculation||The calculated values hold information about which costs are facing the desired return. This proportion helps to find the right share of expenses.|
|Order Confirmations||The released sales order documents contain the sales base. This implies that a return can be expected on a defined level.|
|Estimates||Current cost and return residuals can cause differences in relation to calculated values or the order value. Those residuals must be registered separately as estimated values.|
|Purchasing||A new cost estimate happens automatically if the released purchase amount is higher than the calculated amount. This must not be entered manually; this will be directly handled by the calculated WIP process.|
|Prospects||The expected cost and return values are the actual underlying valuation residuals for the later value residuals. Expected values are a mix of calculation, order confirmations, estimates, and purchasing. The detailed setup of this mix needs to be controlled closely because different valuation methods use different base values.|
|Expense Account Postings||The posted expenses are the first part of a valuation base. As long as not redeemed, these expenses need to be declared as WIP for the reporting due date. A difference can occur if the costs are within or higher than the estimates. If higher, the maximum possible accruals need to be allocated to prepare for an imminent loss.|
|Invoice Posting||Revenues are posted as a result of posting invoices. These revenues are the second part of a valuation base. The booked sales value reduces the valuation rate because the return can be allocated to the current period. If the booked revenue is higher than the maximum applicable cost, accruals need to be allocated for future cost expansion.|
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