When WIP Is Wrong, Margins Tell the Wrong Story

In an ERP implementation, most finance issues in manufacturing trace back to one area: Work in Process (WIP).

If WIP isn’t right:

• Margins get distorted
• Inventory is misstated
• Financials lose credibility

What actually matters:

• Accurate labor & overhead absorption
• Real-time tracking of production stages
• Clear handling of variance (standard vs actual)
• Clean cut-off between WIP and finished goods

Under U.S. GAAP, WIP is not just inventory — it’s your real-time profitability signal.