diff --git a/lib/open_project/reporting/engine.rb b/lib/open_project/reporting/engine.rb
index 9d79dca16d..28a6e61ca9 100644
--- a/lib/open_project/reporting/engine.rb
+++ b/lib/open_project/reporting/engine.rb
@@ -56,7 +56,7 @@ module OpenProject::Reporting
       }
 
     menu :project_menu, :cost_reports,
-         {controller: 'cost_reports', action: 'index'},
+         {controller: '/cost_reports', action: 'index'},
          param: :project_id,
          after: :cost_objects,
          caption: :cost_reports_title,
diff --git a/spec/features/project_menu_spec.rb b/spec/features/project_menu_spec.rb
new file mode 100644
index 0000000000..09f9f44ac1
--- /dev/null
+++ b/spec/features/project_menu_spec.rb
@@ -0,0 +1,89 @@
+#-- copyright
+# OpenProject is a project management system.
+# Copyright (C) 2012-2015 the OpenProject Foundation (OPF)
+#
+# This program is free software; you can redistribute it and/or
+# modify it under the terms of the GNU General Public License version 3.
+#
+# OpenProject is a fork of ChiliProject, which is a fork of Redmine. The copyright follows:
+# Copyright (C) 2006-2013 Jean-Philippe Lang
+# Copyright (C) 2010-2013 the ChiliProject Team
+#
+# This program is free software; you can redistribute it and/or
+# modify it under the terms of the GNU General Public License
+# as published by the Free Software Foundation; either version 2
+# of the License, or (at your option) any later version.
+#
+# This program is distributed in the hope that it will be useful,
+# but WITHOUT ANY WARRANTY; without even the implied warranty of
+# MERCHANTABILITY or FITNESS FOR A PARTICULAR PURPOSE.  See the
+# GNU General Public License for more details.
+#
+# You should have received a copy of the GNU General Public License
+# along with this program; if not, write to the Free Software
+# Foundation, Inc., 51 Franklin Street, Fifth Floor, Boston, MA  02110-1301, USA.
+#
+# See doc/COPYRIGHT.rdoc for more details.
+#++
+
+require 'spec_helper'
+
+describe 'project menu', type: :feature do
+  let(:current_user) { FactoryGirl.create :admin }
+  let!(:project) { FactoryGirl.create :valid_project, identifier: 'ponyo' }
+
+  before do
+    allow(User).to receive(:current).and_return current_user
+  end
+
+  ##
+  # Depending on the current page the link to the cost reports was broken.
+  # This seems to be due to a peculiarity of the rails routing where
+  # `url_for controller: :foo` would return a link relative to the controller
+  # handling the current request path if the controller was routed to via a
+  # namespaced route.
+  #
+  # Example:
+  #
+  # `url_for controller: 'cost_reports'` will yield different results ...
+  #
+  # when on `/projects/ponyo/work_packages`: `/projects/ponyo/cost_reports` (correct)
+  # when on `/projects/ponyo/work_packages/calendar`: `/work_packages/cost_reports?project_id=ponyo`
+  #
+  # This is only relevant for project menu entries, not global ones (`project_id` param is nil)*.
+  # Meaning that you have to make sure to force the absolute URL in a project menu entry
+  # by specificying the controller as e.g. '/cost_reports' instead of just 'cost_reports'.
+  #
+  # Refer to `engine.rb` to see where the menu entries are declared.
+  #
+  # * May apply to routes used with parameters in general.
+  describe '#18788 (cost reports not found (404)) regression test' do
+    describe 'link to cost reports' do
+      context "when on the project's activity page" do
+        before do
+          visit '/projects/ponyo/activity'
+        end
+
+        it 'shows the correct link to cost reports: /projects/ponyo/cost_reports' do
+          a = find_link 'Cost Reports'
+
+          expect(a).to be_present
+          expect(a[:href]).to match %r{/projects/ponyo/cost_reports$}
+        end
+      end
+
+      context "when on the project's calendar" do
+        before do
+          visit '/projects/ponyo/work_packages/calendar'
+        end
+
+        it 'shows the correct link to cost reports: /projects/ponyo/cost_reports' do
+          a = find_link 'Cost Reports'
+
+          expect(a).to be_present
+          expect(a[:href]).to match %r{/projects/ponyo/cost_reports$}
+        end
+      end
+    end
+  end
+end