Handling Write-Offs the Right Way with Deltek Vision

A common misconception for professional services firms is how to handle and manage write-offs of billable time and project expenses. For starters, understanding why write-offs (also known as "loses") occur is important. A common reason write-offs occur is the inefficient use of a person’s time and resources. You might ask, why do we not charge these expenses to the client if the time was spent or a resource was utilized for a specific project? Assuming these excesses were the result of your own firm’s inefficiencies and not a result of the client, absorbing these costs is fair to the client and also a good way to win more business from them. Additionally, if your firm is using Deltek Vision, handling write-offs is a simple process.

Write-Offs in Deltek Vision

Within Deltek Vision, write-offs will occur when a transaction posts. This will be identified for regular charge type projects as the following:

1. Not earned in a revenue generation calculation
2. Not invoiced either by:
   • leaving the transaction in B or to be billed status
   • leaving the transaction in H or held status
   • placing the transaction in W or to be written off status
   • placing the transaction in D or to be deleted status

Tracking Losses in Deltek Vision
Now that the loss has occurred, it’s time to track them. Write-offs will appear in several places:

1. As negative profit on a Project or Office Earning Report when run at “cost”
2. As a negative variance on the above reports when run at “billing”
3. On the Project Review screen (cost and billing tab) in the profit/variance box
4. As a contributor to the Profit/Loss row on the Income Statement

Over the years, I have learned that not only best practice, but in many cases, statutory practice is to ensure when losses become apparent they must be addressed and accrued for in total. Using the functionality and reporting capabilities of Deltek Vision will provide the avenue to accomplish this.