EIEB and BIEE from Project Accounting may carry larger balances on newer versions

I wanted to call attention to a change we made recently in Project Accounting in regards to how Earnings in Excess of Billing (EIEB) and Billings in Excess of Earnings (BIEE) are being handled that has generated some support calls for us.  Starting with the install of our year-end compliance releases on both Microsoft Dynamics GP 2010 and 10 (10.00.1634 and 11.0.1585), we are now calculating EIEB and BIEE at an individual cost category or fee level as opposed to at the project or contract level.
Let’s say you have a project that has 2 cost categories with the following information:

CC1:  Billed amount $1000, Revenue recognized $1500
CC2:  Billed amount $750, Revenue recognized $500

Looking at the project as a whole we have billed $1,750 and recognized $2,000 in revenue so we are in an Earnings in Excess of Billings (EIEB) situation.  On releases prior to the ones mentioned above, the Revenue Recognition transaction would result in a debit distribution for $250 to our EIEB account.

Conversely with the changes we made, we are now evaluating billings and revenue for each cost category individually.  This means that these same cost categories on the current version of the software would have different results for our distributions.  For CC1 we are in an EIEB situation by $500.  And for CC2 we are in a BIEE situation by $250. If you review the distributions in your Revenue Recognition distribution window you will see both account types and accounts being posted to.  This means a debit to EIEB for $500 and a credit to BIEE for $250.

Additional Information:
A couple of things I want to make sure are clear. First this is only a distribution change in the accounts being used.  Revenue and cost are recognized the same as always.  Secondly the net result to the balance sheet is the same; however now both accounts will carry a balance so you may see an increase in the balances of each of these accounts on your financial statements.

You may be wondering too why we made this change.  The reason is to make our distributions more accurate.  We struggled under the prior model if different accounts were being used for the 2 cost categories.  Now we are not forced to pick one, since each cost category (or fee) will use their own.

Hopefully this information provides some clarity around what you are seeing in regards to EIEB and BIEE on the latest versions of GP and gives you some assurance that what you are experiencing is by design.

Pam Peterson | Sr. Technical Lead | Microsoft Dynamics GP

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