Earned Value General Ledger

INTRODUCTION TO EARNED VALUE APPROACH

Muli construction accounting software aims to focus your management on short term liquidity and long term profitability.

In Muli each project:

• is treated as a stand-alone subsidiary of your company
• makes a contribution to overheads, in each accounting period
• has a liquidity relationship to the parent company - as a source and user of funds

Muli is an earned value project management solution because it applies the principles of “Earned Value Accounting” which requires a clear recognition of all financial obligations required to be met to complete the project.

This differs from the “simplistic” Tax view on obligations – where, for example, if you haven’t spent your annual leave it is not a liability.

MULI TRIAL BALANCE

Muli doesn’t create a General Ledger by maintaining rolling G/L balances. Instead, to give managers more flexibility, Muli uses the underlying Accounts Payable and Accounts Receivable transactions to generate the G/L Trial Balance for a given accounting date.

CLEAR PICTURE OF WHERE THE BUSINESS IS AT

The Muli Trial Balance analyses, for the given date, each project and all G/L accounts for:

• approved
• paid
• A/R invoiced and received
• the recognised contribution for active projects

MONTHLY CONTRIBUTION MAINTENANCE

The general ledger processes the contributions on a monthly basis; however management would have used the Project Review Cost & Process routine as the basis for predicting the gross margin expected from the projects.

By taking the value of the work approved over the final forecast cost they arrive at a % complete which is then applied to gross margin to provide a default, (but adjustable) earned value.

IFRS & SBR

Muli is in the process of providing reports in the formats prescribed by International Financial Reporting Standards (IFRS) and the Australian Government Standard Business Reporting (SBR) but we are awaiting clarification of the SBR before releasing this version.

Muli provides full cashflow, Profit & Loss and Balance Sheet reporting in a detailed management format that enables your accountant to efficiently complete the required corporate and taxation reporting.

BAS – TIGHT AUDITABLE GST MANAGEMENT

Muli have implemented GST as a separate element of the accounting transaction enabling a transaction to be dealt with in the required accounting period – but reported in the next available BAS return.

ACCRURAL BASIS

All accounts are prepared on an accrual basis. Muli does not support cash accounting

Download the latest Muli Earned Value General Ledger Fact Sheet