07 June 2012
My client handles many civil projects which contains phase wise payments from the customers/contractee as below :
10% advance against submission of Engineering drawings
70% against completion of phase 1
Balance 20% on completion of phase II and erection and commissioning.
My query is when the client receives an advance against submission of engineering drawings, can the client not raise a sales invoice for 10% of the project value, as it has rendered a professional service by preparing and sumbitting engineering drawings.
If I don't invoice, the advance receipt is shown in the balance sheet under current liability, whereas this is not due since I have rendered a service to that extent.
CAclubindia
