SubContract Variance Account - Adjust Item Cost Entry

We are having an issue with the SubContract Variance account. We are hitting the $ values in this account. The dollars hitting are the dollars that have been received and not paid to the supplier (uninvoiced received).

Here are the steps they follow

1. They create the Production Order. The Production order has SubContract work center.
2. They create the Purchase order through Sub Contract WorkSheets. so the Prod Order No is linked to the Purchase Order.
3. They receive the items.
4. After they receive the items, they create pick and close the Production Order (Change the Status to finished).
5. By process they run Adjust-Item Cost Entries report everyday after hours. Because the production order is closed, this report hits the Sub Contract Variance G/L Account.
6. Most of the times they don't invoice in the same accounting period. So the numbers are growing in this G/L Side to the large unfavourable side.

I think Adjust-Item Cost Entries won't hit this G/L account if we close the Production Order after we invoice the PO.

My question is :

When do we have to close the Production Order (is it after we invoice the PO or before we invoice the PO) ? What is the solution for this problem. Please advise.