How to Record FPIF Final Price Revision
Adjusts the contract value and revenue based on the final price negotiation of a Fixed-Price Incentive (Firm Target) contract after cost auditing.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Accounts Receivable - Unbilled | Asset | 45,000.00 | - |
| Contract Revenue - Incentive Fee | Revenue | - | 45,000.00 |
💡 Accountant's Note
Under FPIF, the final price is determined by applying a share ratio to the difference between target cost and actual cost, subject to a ceiling price. This entry recognizes the final incentive fee earned.
Practitioner & Systems Framework
💻 ERP Architecture
Update the contract master record's total funded value and revenue ceiling to reflect the negotiated settlement.
⚠️ Audit Flags
Final price revision exceeding the contract ceiling or deviations from the share ratio.
📄 Required Documentation
Signed Modification (SF30) and the Final Price Revision Proposal.
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Expert Analysis by Qusai Ahmad
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Discussion & Community Questions
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