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User Tips
A quarterly feature from WON Systems geared towards enabling users to make full use of their Agency Business Software Solution.



Tip 2

Another Option for Advanced Billing in Clients & Profits

Occasionally, I have had clients who want to use the advance billing function (pre-billing), but want the transaction recorded as a liability (not revenue) AND want to show it on the Job Ticket for easier tracking. In C&P Pro this is possible, but you could not reflect the billing on the Job Ticket. In Classic, the Advance Billing Option is not available, however, this technique described below will provide the ability to achieve this. The main benefits are that you do not recognize revenue too early and you can monitor your Advance/Pre-billing progress of the Job Ticket ensuring that you do not exceed billing or budget onthe job and you better balance your cashflows. Finally, should you require a Final/Reconciliation Invoice for the client, you can invoice to actual and reverse the Advance or Pre-bill portion. Here's the process:

Step 1. Add a task for advance billing in the Task Table. For "Kind:" mark the estimate box.

Use the appropriate liability account for client deposits/advances as the credit gl account for the task. By using the liability account, the advance billing will not be recognized as revenue until it is applied to other billings.

Note: When entering the client liability account as the cgl, you may be prompted to use an income account. To make this change goto Setup > Chart of Accounts and change the account class of the account to income. Then, add the account as the cgl for the task. Return to the Chart of Accounts and change the account class back to liabilities.

Mark the task for GST and/or PST depending on the applicability the majority of the time.

Step 2. Add the Advance Billing task to the job ticket. You may also consider adding it to the Job Types that are applicable.

Step 3. Do a job billing and bill the advance task for the advance amount. On the job ticket, the advance task will have a negative unbilled amount in the unbilled column of the job ticket equal to the advance billing. This negative unbilled amount will decrease as the advance is applied to other billings.

Step 4. Apply the client's advance payment to the Job "Advance" Billing invoice.

Step 5. When the job is ready to bill, add a job billing as normal. Include the advance billing task on the invoice for a negative amount that is equal to the billed amount of the tasks being billed. The invoice will net to zero, if the advance is applied for the full amount of the invoice. There will be a partial balance if the advance is applied for less.

Post the billing.

Note: When posted, the advance account will be credited for a negative amount lowering the account balance and the income accounts for the billed tasks will be credited for positive amounts increasing those accounts. In this way the revenue is recognized in the period of the actual job billing.

On the Job Ticket, the negative unbilled amount will decrease on the Advance Task and the unbilled amount for the tasks that were billed will decrease.

Continue to do this on additional billings (if there is more then one) until the unbilled amount on the advance task is zero (the advance has been used up).

Step 6. If there is an advance amount remaining after the job has been fully billed, you can handle the remaining balance in the following ways:

A. If the job was a fixed fee contract you may redistribute the Advance on the Job Ticket. Distribute the remainder of the advance to the other tasks. This can be done in Job Ticket WIP by increasing the gross amount for a tasks cost(s) or all tasks as desired. The total of the increases should equal the amount of the advance payment that was not used. The unbilled amounts on the Job Ticket should equal the negative unbilled amount on the advance task. Total unbilled for the job ticket would then be zero.

Do a final billing and add the remaining negative amount (unused advance) as before. Once the invoice is posted, the Job Ticket will show a zero unbilled amount for the advance task and the unbilled amounts on the Job Ticket will also be 0. The advance will be fully distributed to the rest of the tasks.

B. Refund Client. If you want to refund the unused advance to the client then you can do a job billing for the remaining amount of the advance on the Advance task. Job Bill the advance task for the remaining negative unbilled amount which will create a credit invoice.

Clear the Credit invoice with a negative client payment debiting suspense (acc# 999998). This will clear the invoice off the Client Aging.

Then, to refund the client add an "Overhead Check" for a positive amount equal to the unused advance and debit the suspense account (acc # 999998). The positive debit made by the refund check and the negative debit made by negative client payment will cancel each other out (net to 0).

C. Transfer the Unused Advance to Another Job. You can transfer the unused advance to another job by adding a mutli job billing for that client and negative bill the job advance task that the advance is on and then positive bill the job advance task it is being moved to. This will be a zero billing so it will not show up on the Client Aging or the Client Statement.


I would like to give credit to Mike Ferguson at Clients & Profits who had a large role in compiling this information.

Please call or email me if you would like to speak more about this process or if you have any other questions.
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