diff --git a/drivers/accel/ivpu/ivpu_drv.c b/drivers/accel/ivpu/ivpu_drv.c
index 95120957f42a..8c1c87e69f91 100644
--- a/drivers/accel/ivpu/ivpu_drv.c
+++ b/drivers/accel/ivpu/ivpu_drv.c
@@ -515,6 +515,7 @@ void ivpu_prepare_for_reset(struct ivpu_device *vdev)
 {
 	ivpu_hw_irq_disable(vdev);
 	disable_irq(vdev->irq);
+	atomic_set(&vdev->job_timeout_detected, 0);
 	flush_work(&vdev->irq_dct_work);
 	flush_work(&vdev->context_abort_work);
 	flush_work(&vdev->job_destroy_work);
@@ -710,7 +711,7 @@ static int ivpu_dev_init(struct ivpu_device *vdev)
 	vdev->context_xa_limit.max = IVPU_USER_CONTEXT_MAX_SSID;
 	atomic64_set(&vdev->unique_id_counter, 0);
 	atomic_set(&vdev->job_timeout_counter, 0);
-	atomic_set(&vdev->faults_detected, 0);
+	atomic_set(&vdev->job_timeout_detected, 0);
 	xa_init_flags(&vdev->context_xa, XA_FLAGS_ALLOC | XA_FLAGS_LOCK_IRQ);
 	xa_init_flags(&vdev->submitted_jobs_xa, XA_FLAGS_ALLOC1);
 	xa_init_flags(&vdev->db_xa, XA_FLAGS_ALLOC1);
diff --git a/drivers/accel/ivpu/ivpu_drv.h b/drivers/accel/ivpu/ivpu_drv.h
index 86d7c9966cac..6f4012926478 100644
--- a/drivers/accel/ivpu/ivpu_drv.h
+++ b/drivers/accel/ivpu/ivpu_drv.h
@@ -171,7 +171,7 @@ struct ivpu_device {
 	struct xarray submitted_jobs_xa;
 	struct ivpu_ipc_consumer job_done_consumer;
 	atomic_t job_timeout_counter;
-	atomic_t faults_detected;
+	atomic_t job_timeout_detected;
 
 	atomic64_t unique_id_counter;
 
diff --git a/drivers/accel/ivpu/ivpu_job.c b/drivers/accel/ivpu/ivpu_job.c
index ebb2c865b09a..4689b8ab519d 100644
--- a/drivers/accel/ivpu/ivpu_job.c
+++ b/drivers/accel/ivpu/ivpu_job.c
@@ -621,7 +621,6 @@ bool ivpu_job_handle_engine_error(struct ivpu_device *vdev, u32 job_id, u32 job_
 		 * status and ensure both are handled in the same way
 		 */
 		job->file_priv->has_mmu_faults = true;
-		atomic_set(&vdev->faults_detected, 1);
 		queue_work(system_percpu_wq, &vdev->context_abort_work);
 		return true;
 	}
@@ -1175,10 +1174,10 @@ static int reset_engine_and_mark_faulty_contexts(struct ivpu_device *vdev)
 		return ret;
 
 	/*
-	 * If faults are detected, ignore guilty contexts from engine reset as NPU may not be stuck
-	 * and could return currently running good context and faulty contexts are already marked
+	 * If job timeout is detected, read guilty context from engine reset, for other reasons
+	 * faulty context is already known
 	 */
-	if (atomic_cmpxchg(&vdev->faults_detected, 1, 0) == 1)
+	if (atomic_cmpxchg(&vdev->job_timeout_detected, 1, 0) == 0)
 		return 0;
 
 	num_impacted_contexts = resp.payload.engine_reset_done.num_impacted_contexts;
diff --git a/drivers/accel/ivpu/ivpu_mmu.c b/drivers/accel/ivpu/ivpu_mmu.c
index 41efd8985fa6..b2025274f91d 100644
--- a/drivers/accel/ivpu/ivpu_mmu.c
+++ b/drivers/accel/ivpu/ivpu_mmu.c
@@ -964,7 +964,6 @@ void ivpu_mmu_irq_evtq_handler(struct ivpu_device *vdev)
 		file_priv = xa_load(&vdev->context_xa, ssid);
 		if (file_priv) {
 			if (!READ_ONCE(file_priv->has_mmu_faults)) {
-				atomic_set(&vdev->faults_detected, 1);
 				ivpu_mmu_dump_event(vdev, event);
 				WRITE_ONCE(file_priv->has_mmu_faults, true);
 			}
diff --git a/drivers/accel/ivpu/ivpu_pm.c b/drivers/accel/ivpu/ivpu_pm.c
index c1ce8329790e..de0becbfdffb 100644
--- a/drivers/accel/ivpu/ivpu_pm.c
+++ b/drivers/accel/ivpu/ivpu_pm.c
@@ -229,6 +229,7 @@ static void ivpu_job_timeout_work(struct work_struct *work)
 
 	ivpu_jsm_state_dump(vdev);
 	ivpu_dev_coredump(vdev);
+	atomic_set(&vdev->job_timeout_detected, 1);
 	queue_work(system_percpu_wq, &vdev->context_abort_work);
 }