Last updated November 6, 2026
General information, not tax or legal advice. The rules depend on your country and your situation, so check anything with a tax or legal consequence with your accountant.
A WIP report lists each open job and compares the value of work done to date with the amount invoiced to date. A positive difference is work earned but not yet billed. A negative one means you've billed ahead of the work. Review it monthly, because unbilled work is cash you could be collecting.
WIP in manufacturing means something else: goods part-way through production, valued at cost. This guide covers the service and project version.
What does a WIP report show?
A WIP report shows, job by job, the value of work done, the amount invoiced and the difference, all before VAT. The invoiced figure is simple. The value of work done is the judgement, and how you measure it depends on how the job is priced.
| How the job is priced | Value of work done to date |
|---|---|
| Hourly, or time and materials | Hours and materials to date at the rates you expect to bill, less anything you know you'll write down |
| Fixed fee | Fee × percentage complete, and never more than the fee |
| Stage fees | Completed stages in full, plus the done share of the current stage |
| Construction contract | Often contract price × (cost to date ÷ estimated total cost) |
Value it at what you realistically expect to bill. If 140 hours are logged but the client will only ever accept 120, the extra 20 aren't an asset. They're a write-down you haven't made yet.
How do you read a WIP report?
Read a WIP report line by line first, and only then look at the total, because the net figure hides most of what matters. Here's an invented example: a small firm at month end, with figures before VAT.
| Job | Basis | Value of work done | Invoiced to date | Unbilled or (billed ahead) |
|---|---|---|---|---|
| A | £40,000 fixed fee, 55% done | £22,000 | £18,000 | £4,000 |
| B | £18,000 fixed fee, 90% done | £16,200 | £18,000 | (£1,800) |
| C | 140 hours at £90 | £12,600 | £9,000 | £3,600 |
| D | £60,000 fixed fee, 20% done | £12,000 | £15,000 | (£3,000) |
| E | 30 hours at £90 | £2,700 | £0 | £2,700 |
| Total | £65,500 | £60,000 | £5,500 |
£5,500 looks modest. In fact it's £10,300 of unbilled work on three jobs, netted against £4,800 billed ahead on two others. Different clients, different problems, and the money billed ahead on job D does nothing to get job E invoiced. So report the two totals separately.
| What you see | What it usually means | What to do |
|---|---|---|
| Unbilled and the job is billable now | Nobody raised the invoice | Invoice it this month, as with jobs C and E |
| Unbilled, waiting on a milestone | Your billing stages are too far apart | Check the next trigger, and rethink the stages next time |
| Unbilled and growing, client unhappy | It may not be collectable | Decide on a write-down before it gets older |
| Billed ahead, deposit or front-loaded stage | Normal if agreed | Don't treat it as profit, because the work is still to come |
| Billed in full, work left, as with job B | You have to finish with no more to bill | Check there's enough budget left to finish properly |
Age matters as much as the amount. Add a column for the date of the last invoice on each job. A £2,700 balance on a job invoiced last month is fine. The same balance on a job with no invoice since spring usually means a problem nobody wants to raise.
How do you build a WIP report in a spreadsheet?
Build a WIP report in a spreadsheet with one row per open job, and update it on the same day each month.
- List open jobs. Include finished jobs not yet fully invoiced, since those are the easiest money on the sheet.
- Enter the basis. Hourly, fixed or stage, with the fee or rate.
- Enter hours to month end for time-based jobs, multiplied by the rate you expect to bill.
- Enter percentage complete for fixed-fee jobs. Have the person running the job set it from what has been produced, without looking at the hours used.
- Enter invoiced to date, net of VAT and including deposits.
- Calculate the difference, with unbilled and billed-ahead totalled separately.
- Add the date of the last invoice and a note on what happens next.
Then use it before the invoicing run. A WIP report that gets looked at after invoices have gone out only tells you what you missed.
One number makes the monthly review quicker. WIP days is unbilled work divided by average daily billings. With the invented £10,300 unbilled and billings of £480,000 a year, that's £10,300 ÷ (£480,000 ÷ 365) = 7.8 days. Add your debtor days from an aged receivables report and you have what law and accountancy firms call lock-up: how long work takes to turn into cash. Watch your own trend, since there's no universal right number.
How do contractors' WIP schedules differ?
Contractors' WIP schedules usually measure progress by cost rather than by hours, comparing cost to date with estimated total cost on each contract. Banks and surety companies often ask to see them. Here's an invented example:
| Contract price | $500,000 |
| Estimated total cost | $400,000 |
| Cost to date | $160,000 |
| Percentage complete (cost to date ÷ estimated total cost) | 40% |
| Earned to date (40% × contract price) | $200,000 |
| Billed to date | $230,000 |
| Overbilled | $30,000 |
The weak point is the estimated total cost. If it's stale, the percentage and everything after it are wrong, which is why this schedule gets reviewed with the project manager. A construction business billing on AIA forms can compare this with the G702 and G703 figures: the application shows what you've claimed, and the schedule shows what you've earned.
Does WIP go in your accounts?
WIP goes in your accounts if you report on an accruals basis, but the management report and the accounting entry aren't the same thing. A monthly WIP sheet can use your best judgement. The year-end figure has to follow your accounting framework.
Under IFRS 15, for instance, an unconditional right to be paid is a receivable, a right conditional on something other than time is a contract asset, and money received before the work is done is a contract liability. Small companies often report under other frameworks with their own rules, and cash-basis firms may record nothing until they invoice or get paid. Ask your accountant which applies, and give them your WIP sheet at year end.
Getting WIP figures out of ERPFlow
ERPFlow has no WIP report, project budgets or per-project costing. It doesn't have a timer or timesheets today. Time tracking, including converting tracked time into invoices, is coming soon. The report itself stays in a spreadsheet, and ERPFlow can supply some of the numbers:
- Invoiced to date. Export invoices as CSV, with one row per line and the amounts, dates and status. The export doesn't carry the project, so put your job number in the invoice's Reference number field, which is a column in the file.
- By customer. A customer's Analytics tab shows total revenue and outstanding, net of tax, which is enough if each customer has one job at a time.
- Hours. A card in Projects has a time spent field, typed in as hours and minutes. Totals add up per project and per customer, and the card export gives you the time per card.
- Percentage complete. That's your estimate. ERPFlow doesn't calculate it.
Expenses aren't linked to jobs or customers in ERPFlow, so a cost-based schedule like the contractor's one above needs your own cost records.