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Hello everyone

 

We have a strange occurrence whereby the cost recognized is different from the actual cost for a project that is POC Income First. The first line for example, shows actual cost of 4,450.71 but the calculated cost recognized accumulated is 23,801.66 .

 

My understanding is that if it is POC Inecome First then the cost that will be recognized will be equal to the actual cost. Would anyone have an idea of what would cause such a discrepancy in this case? Any thoughts would be appreciated.

 

 

 

 

Hello,
Do not forget about foreseeable losses…

If your project is loss-making (estimated costs greater than estimated revenue) system is booking recognition of foreseeable losses - Revision accounting comes into picture. 
Catch Up means that proportion of the loss according to the remaining POC will be added onto the total costs. 
Prospectively means that prior period losses are allocated to the current and future periods. 
System is presenting this provision in recognized costs. In case of POC Income First, this is usually the only difference between costs actual and recognized.
I hope it helps.

​@Adam Bereda  thank you Adam! That was exactly the reason. Much appreciated.

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