Key takeaways
- The Project Cost Log is a cost register with one row per document. It passes data on to accounting, tax, retention, budget vs actual and management reporting.
- The key is choosing the right cost category, because the category determines capitalisation, the account code and the default rates for VAT, WHT and retention.
- WHT and VAT on construction progress payments should be based on the amount actually paid, while retention is taxed only when it is returned. For example, a progress payment of THB 50 million results in a net payment of THB 49.4 million.
- The key rules are: fill in only the designated cells, spell vendor names consistently, and record the payment date every time.
What the cost log solves
Many projects hold several separate sets of cost data: the project team's file, the payment file and the accounting system. At month-end they do not reconcile. The cost log brings the essential data together in one place. One row equals one invoice or one payment, and downstream data is generated from that row.
Structure of the tool
| Sheet | Function | Main users | Frequency |
|---|
| Setup | Project data, total budget, loan facility, key dates | CFO, MD | Once |
| Lists | Cost categories, WBS, vendors and default rates | Administrator | When there is a new item |
| Cost Log | Main log | AP, accountants | Daily |
| JE Helper | Converts each row into an accounting entry | Accountant | Daily |
| Budget vs Actual | Compares budget with actual by category | PM, Finance | Monthly |
| Tax Tracker | WHT and VAT by month paid | Tax, AP | Monthly |
| Retention Ledger | Retention by contractor | AP, PM | Monthly |
| Dashboard | Summary figures for management | MD, CFO | Weekly |
| Checklist | Month-end closing and audit trail | CFO, Finance Manager | Monthly |
Starting data
Enter the project name and code, developer entity, project type, number of units, net saleable area (NSA), total budget, loan facility and VAT status once only. The key dates to specify are the land purchase date, the start of pre-construction, the actual construction start, the expected TOP date, the first transfer day and the project closing date. The period from construction start to TOP determines which interest qualifies for capitalisation under TAS 23.
The nine cost categories
| Category | Example items | Initial treatment |
|---|
| A Land | Land price, transfer costs, DD, surveys, land purchase brokerage | CAP |
| B Hard Cost | BOQ, architectural, MEP, lifts, infrastructure, owner-purchased materials | CAP except abnormal waste |
| C Soft Cost | Design, engineers, PM, QS, EIA, permits, insurance, common-area FF&E | CAP except sales gallery, which is CAP-PPE |
| D Sales | Marketing, digital, commissions, construction-period events, sales gallery | EXP, OPT or CAP-PPE |
| E Finance | IDC, post-TOP interest, loan fees, mortgage, shareholder loans | CAP or EXP depending on conditions |
| F Overhead | Site office, project team, security guards, tools, HO allocation | CAP except HO |
| G Selling costs | Transfer fees, SBT, stamp duty, land and building tax during the sales period | EXP |
| H Reserves | Contingency, warranty, common-area fund | BUDGET, PROV or LIAB |
| I Post-closing | Repairs within the DLP, setting up the juristic person | EXP |
| Treatment | Meaning | Destination |
|---|
| CAP | Capitalise as inventory | Development WIP |
| CAP-PPE | Capitalise as fixed assets | PP&E |
| EXP | Period expense | P&L |
| OPT | Costs to obtain contracts that may qualify | Contract asset or P&L |
| PROV | Provisions | Warranty Provision |
| LIAB | Liability | Common-area fund money |
| BUDGET | Reserve budget | Not recorded in the accounts |
Recording one row, step by step
- Enter the entry date. The system generates the document number automatically.
- Enter the vendor, description and document number. The vendor name must match the register.
- Select the cost category. The system fills in the treatment, account code and default rates.
- Enter the WBS and the amount before VAT.
- Check VAT, WHT, retention and the payment amount. Adjust only where the facts differ from the defaults.
- Enter the payment date, payment method, approver and status. The payment date determines the tax month.
- Post to the accounting system and change the status to Posted, so that outstanding items can be checked.
Required fields
| Group | Field | Reason |
|---|
| Document | No., entry date, document date, type, invoice number | Enables duplicate checks and traceability |
| Seller | Name, tax ID, type | Vendor type affects the WHT rate |
| Classification | Category, treatment, account code, WBS | Determines all reports |
| Amounts | Amount before VAT, VAT, invoice total, FX | Separates cost from tax |
| Deductions | WHT, Retention, Net Cash Payable | Matches the cash actually paid |
| Payment | Payment date, method, account, approver, status, documents | Used for tax and control checks |
Worked examples
Example 1: construction progress payment with 5% retention
| Item | THB |
|---|
| Certified work value before VAT | 50,000,000 |
| Less 5% retention | (2,500,000) |
| Payment amount before VAT | 47,500,000 |
| VAT at 7% of the payment amount | 3,325,000 |
| Less WHT at 3% of the payment amount | (1,425,000) |
| Net cash paid | 49,400,000 |
| Journal entries | Debit | Credit |
|---|
| Inventory – development WIP | 50,000,000 | |
| Input VAT, where credit can be claimed | 3,325,000 | |
| Payables or bank | | 49,400,000 |
| WHT payable | | 1,425,000 |
| Retention payable | | 2,500,000 |
| Total | 53,325,000 | 53,325,000 |
Where the developer cannot claim a VAT credit, record inventory including VAT at THB 53,325,000. If the contract requires a full tax invoice for the whole progress payment, the VAT liability arises immediately when the document is issued, so agree the invoicing method before the first progress payment.
| Case | Category | Calculation | Accounting treatment |
|---|
| Land purchase from an individual: THB 100,000,000 | A.1 | No VAT, WHT or retention. Net payment THB 100,000,000 | Inventory – land |
| Digital advertising: THB 500,000 | D.2 | VAT 35,000; WHT at 2% 10,000; net payment THB 525,000 | Selling expense |
| Interest during construction | E.1 | Per the loan schedule | Inventory until the completion date |
| Interest after TOP | E.2 | Per the loan schedule | Finance costs |
Payments to overseas service providers raise WHT and VAT issues separate from those for domestic providers, so the tax team should review each case. Editing the value in a rate cell overwrites the formula in that row, so state the reason in the log row.
Monthly reports
Budget vs actual and EAC
| Figure | Source | Use |
|---|
| Budget | Approved budget | Comparison baseline |
| Actual | Cost Log | Cumulative actual cost |
| EAC | Monthly review | Forecast cost at completion (EAC) |
| Variance | Budget less EAC | Expected variance, not variance to date |
| Status | By internal criteria | Example: below −5% = OVER, −2% to −5% = WATCH |
Looking at actual alone tells you only how much has been spent, not what figure the project will end at. Adjust EAC every month, even if no payment has been made.
Tax Tracker
A WHT summary split by PND 3 and PND 53, and an input VAT summary for preparing PP 30, by the month actually paid. Always enter the payment date; otherwise the item will not be included. Developers outside the VAT system should use this as cost data, not as data for claiming credit. The paper filing deadlines are the 7th for WHT and the 15th for PP 30. For online filing deadlines, check the Revenue Department announcement currently in force.
Retention Ledger
The total retention withheld by contractor, the amount returned, the balance and the age of items. Reconcile it with retention payable in the GL every month. Returning retention clears the liability; it does not add to inventory a second time.
Executive Dashboard
- Total budget, cumulative actual, % of budget and remaining balance
- Capitalised amounts, P&L expenses, WHT and retention held
- Input VAT, number of items, items not yet posted, and net cash paid
- Major vendors and summary by category
Month-end closing
- Reconcile invoices with payment certificates
- Record IDC per the schedule and check the date capitalisation stops
- Reconcile inventory movements with the cost log
- Check that no cost of sales or overhead has entered inventory
- Reconcile retention with retention payable
- File tax returns and keep proof of filing
- Test NRV at least quarterly
- Review EAC and explain variances
- Clear draft items and back up files monthly
- At year-end, review warranty, deferred tax and cost allocation
Data discipline and troubleshooting
- If one invoice covers several categories, split it into rows in proportion.
- Always spell vendor names exactly as in the register.
- Do not delete or insert columns in the log sheet, to avoid breaking the reports.
- Use the statuses Draft, Approved, Paid and Posted to show progress.
| Symptom | Causes to check |
|---|
| Document number does not appear | Entry date not yet entered |
| Treatment or account code is blank | Category not selected from the list |
| VAT or WHT not calculated | Amount before VAT is still zero |
| Retention does not match | Contractor name does not match the register |
| Dashboard shows many outstanding items | Not yet posted to the accounting system |