Software company

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Sunny (Querist)

27 February 2014 as far as i am aware software companies enter into time based contracts wherein bill is charged for time spent into pre fixed charge for a time unit....but in that case how do i audit the no of hours spent? how do i determine genuineness of hours billed....since to increase the revenue every company will try to bill for more hours....urgent reply is highly appreciated thanks in advance....

Nikhil Kaushik

Nikhil Kaushik (Expert)

27 February 2014 it is not as easy as that a software company can charge any number of hours. the clients also monitor the hours billed and normally it is controlled by the contract documentation.

what you can do is to make sure you cross tally the employee-wise hours spent as per HR records and total client wise hours spent.

Sunny

Sunny (Querist)

27 February 2014 Thanks a lot Nikhil Sir,

In that case if there is an increase in estimated hours what treatment should be given in case the client accepts the in crease in hours and in case a client does not accept the increase in hours?

Thanks a lot

Nikhil Kaushik

Nikhil Kaushik (Expert)

27 February 2014 Normally in such cases either amounts are negotiated. Where negotiations fail you need to reverse the revenue booking

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