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SSAP9 undermined?

17 September 2000
Issue: 3775 / Categories: Forum & Feedback
'Receipt of progress payments is ignored'

Large projects in the construction industry are accounted for under Statement of Standard Accounting Practice 9. Under this the receipt of progress payments is ignored. The job is treated as a unity and profit recognised on an appropriate basis throughout its life.
Two factors which have hitherto had to be borne in mind are the accrual of the job i.e. the percentage of it which has been completed and within the cap provided by that constraint the attribution of expected profit has to be prudent. These two factors form two of the four fundamental accounting concepts laid down by SSAP2.
Where architects and consulting engineers are concerned the extent of the work to be undertaken during the supervision stage i.e. after the builder has gone on site is not easy to estimate because the timing of their performance...

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