Guide
Glossary
Work in progress (WIP)
Work in progress (WIP) is the value of time recorded and disbursements incurred on client jobs or matters that have not yet been billed. It is usually valued at standard charge-out rates, so it shows what the firm could invoice, not what it will collect. Partners watch total WIP, aged WIP and WIP days, because the older unbilled work gets, the harder it usually is to bill in full and the longer cash is delayed. WIP plus unpaid invoices (debtors) makes up lock-up. Practice management systems such as Xero Practice Manager, Actionstep and LEAP track WIP by job or matter.
Also called WIP, unbilled time, unbilled work
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Example
In an accounting firm
Every Monday, the practice manager of a 20-person accounting firm exports WIP from Xero Practice Manager into a spreadsheet to find jobs with unbilled time older than 60 days. An automated weekly report shows the same aged WIP by partner and client without the export, so partners can bill finished jobs sooner and follow up stalled ones.
Guides that explain it in context
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