Account 337 – Progress billings

1.Rules for accounting

a) This account is used to record payables under schedule made by clients and receivables under revenues for the percentage of work that has been completed which is determined by the contractor in the contract of construction in progress.

b) Account 337 "Progress billings" only applies to construction contracts regulate that contractors are permit to make payments under schedule. This account shall not apply to construction contracts regulate that contractors are permit to make payments equivalently to the percentage of work certified by clients.

c) Documents on revenues equivalent to percentage of work that has been completed during a period (other than invoices) which are issued by the contractor and not certified by clients shall be the basis for recording to Dr 337. The contractor must choose methods for determination of percentage of work completed, and assign related departments to determine value of completed works, and prepare documents on revenues earned from construction contracts during a period.

Invoices prepared under billing schedule as specified in the construction contract shall be the basis for recording to Cr 337. Amounts stated in these invoices shall be the basis for recording trade receivables by contractor, but not recording revenues in accounting period.

d) Account 337 must be kept records in details for every construction contract.

2.Structure and contents of account 337 – Progress billings

Debit: recording receivables according to revenues equivalent to percentage of completed works under contract of construction in progress.

Credit: recording trade payables under schedule of the contract of construction in progress.

Debit balance: recording positive difference between revenues under the contract and trade payables under schedule of the contract of construction in progress.

Credit balance: recording negative difference between revenues under the contract and trade payables under schedule of the contract of construction in progress.

3.Method of accounting for several major transactions

a) In case a construction contract specifies that the contractor is entitled to make payment under schedule, when performance of construction contract is estimated reliably, the following accounts shall be recorded according to documents on revenues equivalent to completed work (other than invoices) determined by the contractor:

Dr 337 – Progress billings

Cr 511 – Revenues.

b) According to invoices prepared under billing schedule to record receivables under schedule under the contract, the following accounts shall be recorded:

Dr 131 – Trade receivables

Cr 337 – Progress billings

Cr 3331 – VAT payables.

c) When the contractor receives payment from clients, the following accounts shall be recorded:

Dr 111, 112.

Cr 131 – Trade receivables.

Source: Circular 200