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WORKING SMARTER EVERY DAY
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Job Cost Transfers
It's going to happen
sometime. You've got a cost on a job that can't be
billed. Or you've gone over estimate, a vendor invoice
was added to the wrong job or something unexpected
happened. What to do? Transfer the job costs.
Job cost transfers allow billable costs
from one job or task to be charged to another. You
can move a cost from one job to a different
job, or from one client to another client.
Both the net and gross (billable) amount
can be transferred. Generally, only the
gross (billable) is moved. Here's why: You
want to keep an accurate total of what the
job's production cost is. If you transfer net
cost, the job the cost is transferred from
becomes more profitable than it really is because
it's missing a net cost. The job the net cost
is transferred to is less profitable as it
now shows net cost it didn't incur.
What if a cost has the wrong job number? If
a net cost is mistakenly placed on the wrong
job, transfer both the net and gross cost to
the correct job. This procedure is easier than
unposting, editing and reposting the transaction
What about unbilled
time? If the cost to be transferred is unbilled
time on the wrong job, simply edit the time entry.
This moves the hours, in addition to the net and
gross amounts, to the proper job. If unbilled time
can't be billed from its job, leave the hours and
net cost but transfer the gross (i.e., unbilled)
amount only.
Whoa there, buddy. Be sure to limit
employees who have access to job cost transfer.
It is possible to use this method to make jobs
look more profitable then they really are.
You do not want someone to abuse this useful
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By
Karen Farnum
Let's face the facts: You need to
bill your clients for the work that you do. But for every hundred
agencies out there, there are a hundred different ways to do billing.
The key is to first figure out your internal billing process, then
see how Clients & Profits fits into it. Here are some ideas
to help.
Someone first needs to identify the jobs that are
ready to bill. It's usually the AE, but not always. The accounting department
should establish a routine billing cycle (e.g., 15th and 30th of the month) so
everyone knows when the billing cutoff time is. Be sure to stick to it. While
every client has a special billing situation, these cause delays in billing --
which means delays in payment.
Start by printing the Billing Worksheet from Snapshots,
since it lists all jobs with currently unbilled costs. (Hint: Use a "Ready To
Bill" status code that lets AEs communicate easily and efficiently with the accounting
department so they know which jobs to bill. Use this report as a billing checklist
(it can even identify the steps of your shop's billing |
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workflow
on the report itself). Use it as a guide to review a job's costs:
Are the job cost Accounts Payable invoices added and posted?
Has all time been added? What about in-house expenses? Have the
A/P invoices and the expenses been posted? And of course review
any open POs and contact the vendor to find out if you owe them
additional money.
(Another tip: Instead of printing cost reports
on paper, train your AEs to review job costs using Clients & Profits. All
costs can be reviewed online right from the Job Ticket window. The trees you'll
save thank you in advance.)
Once the jobs have been reviewed, the invoice can
be created in A/R. There are many shortcuts that make adding invoices for unbilled
jobs fast and easy (the Better Billing newsletter
has details). Now the invoices you've created can be printed for a final review,
posted, then mailed to awaiting clients.
Karen
Farnum is a member of the Clients & Profits Helpdesk. |
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