Unbilled File Reconciliation
A file reconciliation (file rec) issue is a discrepancy between the sum of the detail for an account and the same account's balance on the general ledger. To determine if an unbilled services file reconciliation issue exists, you can run the File Reconciliation Report.
To run the report, select from the Vision Navigation menu.
On the File Reconciliation Report, Unbilled Services is the item that pertains to Revenue Generation and unbilled file reconciliations. If you use revenue categories to track multiple unbilled accounts, all revenue categories are included in the unbilled services amount.
Unbilled Services is account 121.00 in the standard Chart of Accounts.
If the Difference column contains a negative amount, this means that the balance in the general ledger Unbilled Services account does not match the Total Unbilled amount on the Office Earnings report, when the Office Earnings report is run for all projects, whether or not they had activity during the period.
Reasons for File Reconciliation Issues
Unbilled file reconciliation issues usually result from posting a cash receipt or a journal entry transaction to a revenue account, because these postings do not post an offsetting transaction to the Unbilled Services account. Without the offsetting transaction, the Office Earnings report increases the revenue amount to include the cash receipt or journal entry. Because the cash receipt or journal entry is not invoice-related, the Office Earnings report shows the excess revenue in the Unbilled column.
The Office Earnings report calculates revenue by summing the detail from the revenue accounts on the Income Statement. Because the Office Earnings report calculates revenue to equal Job-to-Date Billed plus Unbilled, if revenue differs from the Billed amount on the Office Earnings report, the Office Earnings report increases its own Unbilled amount without changing the balance in the Unbilled Services Account This causes an unbilled file reconciliation — the Unbilled amount on the project reports differs from the balance in the unbilled services account on the Income Statement.
Address unbilled file reconciliations by researching them. Then change the project's revenue method formula, the revenue method, compensation, or multiplier, and rerun Revenue Generation.
- Make sure that your comparison uses the Office Earnings report for all projects (when you generate the Office Earnings report, leave Only Projects with Activity unselected).
- Identify the accounting period when the unbilled file reconciliation began.
- In the Account Analysis for revenue accounts, for the accounting period when the unbilled file reconciliation began, look for any entries other than Invoices and RevGen journal entries.
The most common cause for a difference between the Office Earnings report and the Account Analysis is an entry to a revenue account that is not offset by an entry to the Unbilled Services account. Posting cash receipts to a revenue account can also cause the Office Earnings report and Account Analysis to differ.
- At the time a cash receipt or journal entry is posted, the amount in the Balance Sheet Unbilled Services account is correct, and the amount shown as Unbilled on the Office Earnings report is adjusted (incorrect).
- After you run Revenue Generation, the amount shown as Unbilled on the Office Earnings report is correct. The amount on the Balance Sheet is incorrect, because Revenue Generation has tried to correct the difference.
Balances and Reports That Should Tie
- The balance in the Unbilled Services account should tie with the Unbilled amount on the Office Earnings report. Be sure you are not using other reports to locate or correct an Unbilled file reconciliation.
- The balance in the Unbilled Services account usually does not tie with the Unbilled amount on the Unbilled Detail Report. It will tie only if all projects have a revenue method that uses work in progress.
- The balance in the Unbilled Services account on the Balance Sheet may equal the balance in the Unbilled Revenue account on the Income Statement in the first year. Thereafter, the Unbilled Revenue account is cleared at each year-end and Unbilled Services accrues from year to year.
- The Unbilled Detail Report does not tie to the Project Progress or Project Detail Reports, because of write-offs and billed amounts suppressed on invoices.