I think that if you know that there won't be a premium billing and your recovery rate's at 100%, then that's probably what you would do to determine the fair market value of it, although there are other considerations.
However, that's not the situation you were talking about. You were talking about when you bill 100 hours, and maybe your recovery is higher than your normal billing rate—or lower, depending on the outcome of a case—or perhaps it's contingent, in the sense that you know that you'll bill x dollars per hour for the case, but there's some uncertainty about whether you'll be able to collect at the end of the day or will just take a writeoff. That's where you have to make a determination at the end of the year, based upon the facts, of the worth or the fair market value of the work you've done to that point.
It's difficult to put exact numbers on it, but let's say you have $10,000 of work in progress. You make a reasonable determination that you'll probably collect 80% of it, so then it would be worth $8,000. That's where the ability to come up with a fair value comes in. As I said earlier, if it is truly uncertain, if you just don't know whether or not you're going to win it or whether or not you're going to get paid, there is case law supporting the notion that you don't have to include anything.
Third, there is the ability to pick the lower of cost or fair market value, a method for inventory where you have that kind of file. Let's say you know that your costs are $6,000. You think your costs might be $10,000, or they might be up to $14,000, or they might be as low as zero. If you reasonably think that it probably will be $10,000, you can pick the lower of cost or fair market value to take the $6,000 of cost. So you're insulated from that, to some degree.