Retentions
Posted: 20 Mar 2009, 19:09
We deal with a lot of contractors who deduct retentions from their payments. What is the best way to post these so that we can ensure that they're invoiced in 12 months time?
The best way to control anything is with a control account in the balance sheet.
Journal the future sale value to the retentions control account and each month / quarter, you should be able to produce a list of all the retentions and they should add up to the control account value.
If retentions are not always got without remedial work or additional costs, then you might not want to treat them this way.