Practice Activity 13.15 Accounting for services rendered to a customer over a period of time

A firm of project managers enters into a three-year contract with the Federal Government with respect to the Government’s construction of a dam to facilitate the generation of electricity and distribution to communities in need of electricity. Based on the contract, the responsibilities of the firm are:

i. Overall planning of the project;

ii. Distributing materials, labour, and other resources for the project;

iii. Managing time spent on the project;

iv. Managing risks associated with the project;

v. Creating benchmarks in the course of the project;

vi. Managing the budget of the project;

vii. Managing the staff involved in the project; and

viii.Managing relationship with key stakeholders in the course of the project.

How should the firm of project managers account for the project management services rendered to the Federal Government?

A suggested answer to practice activity 13.15