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What is Unabsorbed Time and how can it be removed?

Article ID
what-is-unabsorbed-time-and-how-can-it-be-removed
Article Name
What is Unabsorbed Time and how can it be removed?
Created Date
7th July 2020
Product
Problem
What is unabsorbed time and how can it be removed?
Resolution

What is Unabsorbed Time?

An unabsorbed balance is negative WIP balance created when a credit posting exceeds the current WIP balance on a client. An Invoice, Write Off, General Adjustment, Correction, and Opening Balance can all reduce the client WIP balance but can also create an unabsorbed balance. If you wish to remove unabsorbed WIP from an account, there are three options available:

  • Reverse the original invoice that created the unabsorbed and repost it writing out to a smaller value.
  • Create an Opening Balance to the same value of the unabsorbed
  • Switch Off the instruction that is causing the unabsorbed to appear

Reverse the Original Invoice that created the unabsorbed

For example, there is £100 WIP on a client, and the invoice posted on the client was writing out £200. This would cause an unabsorbed amount of £100. In this case, it is recommended to reverse and repost the original posting. Once the posting has been reversed, re-enter the invoice with the correct details. For more information on how to do this please click HERE

Create an Opening Balance

Creating an Opening balance for the same value as the unabsorbed will automatically remove the unabsorbed from the account. However this will show that more work has been done for the client. For example, there is £100 WIP on a client under the General job (GEN), the invoice posted on a client was writing out £200. This would cause an unabsorbed amount of £100. To do this:

  • Log on to IRIS Time from the IRIS Main Menu
  • Click on Post WIP |Opening WIP
  • You may be prompted for a period, select the period that you would like the posting to be made to. For example you want to make the posting to the January period i.e. 2012/01
  • The Post WIP Opening Balances to Period 2012/01 screen will be displayed
  • Enter the following details: a. Posting Type: select ‘Debit’ b. Amount (WIP): Enter the unabsorbed amount, for example £100 c. Posting Date: Enter posting date, for example 01/01/2012 d. Client/Non charge: Enter the Client ID (or select it using the magnifying glass) e. Job: Enter the Job ID, for example GEN (or select it using the magnifying glass) f. Work Type and Staff ID fields are optional and do not have to be filled in
  • Click on the Post button. The posting needs to be updated to the Time ledger, to do this:
  • Log on to IRIS Time from the IRIS Main Menu
  • Click on Pending Queue | Update Ledger
  • Enter the Periods that you have been working on For example if you only wanted to update any postings made to January (2012/01) periods, ensure these periods are selected in the “From” and “To” criteria
  • Under include entries for ensure “Time” and “Expenses” are ticked
  • Place a tick next to Opening Balances
  • If you would like only specific dated postings to be updated to Ledger, then enter required dates for example 01/01/12 to 01/01/12
  • Click on the OK button to start the update. This should then remove the unabsorbed amount

Switching off the Instruction

This option will post a debit adjustment to remove the unabsorbed WIP from the Time Ledger. This instruction has to be switched off from the Time Ledger. To run the switch off facility:

  • Log on to IRIS Time from IRIS Main Menu
  • Click on Enquiries | Account details
  • Enter the Client ID (or select using the magnifying glass)
  • Enter a job if the unabsorbed amount is being displayed on a particular job
  • Under the ‘Include’ section select “Instructions”
  • Highlight the instruction that is causing the unabsorbed balance, click on the View button
  • Time ledger instruction screen will be displayed, click on the Switch off button
  • A confirmation screen will be displayed, select the period to make the posting to for example 2012/01
  • Click on the Confirm button the unabsorbed balance will no longer be displayed on the client’s account.

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