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Accounts Receivable

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A/R Features
Feature	How it works, how it’s used
Integrated with job tickets	When a job ticket is referenced on a cost or billing, the job ticket is updated when the invoice or check is posted to the G/L. So the job tracks what needs to be billed and what’s already been billed.
Automatic billing	The amount to be billed is copied from the job ticket to the invoice automatically.
Flexible billing styles	There’s an billing style for every need. Billing types include estimate, progress/final, multi-job, media, retainer, advance, miscellaneous, finance charge, and job billing.
Invoice options	Options allow you to show more or less detail to customize the client’s invoice. Tasks can be rolled up, grouped, or totaled with the group and hidden. For more detail, the description or hours billed can be included. The estimate and previous billings can also be shown as an option.
Billing Worksheet	The Billing Worksheet shows which costs are billed on the invoice. The amounts, per cost, can be edited as long as the total the invoice total remains the same.
Two sales tax rates	Up to two sales tax rates can be entered on each task. The sales tax account(s) to be credited and the rates are copied from the client account when the job is open.
Non-job invoices	Miscellaneous or finance charge invoices update the client account, but don’t affect the job.
Retainers and advances	Retainers are deposits from clients which do not update the job. When the job is billed, the retainer is applied to it. Advance billings are deposits for a specific job, and are applied to the same job when it is billed.
Distribution copies	Up to five copies of each invoice can be printed without using expensive multipart forms.

Billing an Invoice

Billing is one of the job’s most important steps. It summarizes all of the work you’ve done on a job -- including payables, time, checks, and expenses -- on a simple, concise printed invoice. Invoices can be added at the end of the month, or throughout the month as jobs are completed. Billing works like this:

(1) Unbilled jobs are reviewed on work in progress reports to see what’s ready to bill;

(2) account executives can adjust unbilled amounts, if needed, to fine-tune what will be billed. Costs, time, and expenses can be transferred between jobs to the same task;

(3) from these work in progress reports, invoices are added for each job’s unbilled tasks. The auto-bill option can bill these jobs automatically in one step;

(4) these new invoices are proofed, edited, then posted. Posting updates the client’s balance, job totals, and the financial statements;

(5) the new invoices are printed, then mailed to clients;

(6) when the client sends a payment, it is added into Client Payments and applied to these unpaid invoices.

This completes the billing cycle. Everything you bill affects the client account and the General Ledger when invoices are posted. Invoices are posted to update clients, jobs, and the General Ledger. Posting an A/R invoice creates G/L journal entries automatically. The invoice’s total makes a debit entry, usually updating the A/R account; each invoice line item makes a credit entry, usually for an income account. Posted invoices appear on job reports, billing reports, statements, and client aging reports.

Where do billing amounts come from?

An invoice’s billing amounts come from job tasks. Each job task keeps a running total of its costs, time, checks, and expenses from the day the job began. The job task’s unbilled balance shows its unbilled gross costs (which includes markups, commissions, and billing rates) less what’s been billed before.

Job costs aren’t literally billed on the invoice. Instead, the invoice bills the job’s tasks -- specifically, each task’s unbilled amount. When you bill a job, every task that has unbilled costs can appear on the invoice (either automatically or manually, your choice). The invoice’s billing amount is copied from the job task’s unbilled amount. So clients don’t see every cost, time entry, and expense on invoices; instead, they only see job tasks.

You can freely change the invoice’s billing amounts. The job’s costs are unaffected, giving you the flexibility to bill any amount you wish without making complex, time-consuming adjusting entries.

How do I know what to bill?

Job tickets keep running balances of billings and unbilled costs, so knowing what’s to be billed at any point is easy: just look at the job ticket. Instead of reviewing jobs separately, work in progress reports search your database for unbilled jobs.

WIP reports make it easy to pinpoint which jobs need to be billed now, which is especially useful when there are hundreds of open jobs. Work in progress reports select jobs by status. A job has a different production and billing status, for flexibility. Billing status can be used by account executives to track billable jobs, without interfering with the production manager’s job status.

Before billing, WIP reports can be distributed to your various account executives for review. Once the unbilled jobs have been adjusted as needed, these reports can be used as checklists for the month’s invoicing.

Credits, adjustments, and finance charges

Credits can be made for a client by entering an invoice with negative billing amounts. When a credit invoice is added as a job billing, the credits will reduce the amount billed on the job ticket; if not, the credit will only affect the client balance and the General Ledger. Credits, as well as finance charges, can also be applied when the client payment is added (which doesn’t affect the job either). Finance charges can also be billed separately.

When do I bill something?

There are no real rules when it comes to billing in Clients & Profits X. Any kind of invoice can be added, posted, and printed anytime during the month. A job can be billed when it is opened, using its estimate (or any percentage of its estimate). Jobs can be billed progressively, or at completion.

Invoices can be added for anything that needs billing, whether or not it involves a job. This means you can bill client retainers, finance charges, consulting fees, and more where no job exists. Whatever way you choose to bill, jobs always remember what you’ve billed so far. The Job Ticket window shows the job’s billings and unbilled totals. You can see at a glance what’s to be billed on a job ticket

Invoices and Work in Progress

Every job cost remembers when it was billed, including the invoice number, date, and billed amount. Costs are billed when the invoice is created, automatically.

The process starts when a cost is added: All job costs are marked as unbilled (unless the job task is unbillable). When the job is billed, its unbilled amount is copied to the invoice -- task by task -- where you can change it. When the invoice is saved, the billing amount for each task is applied to its costs -- starting with the oldest first, until no billing amount remains. The costs that aren’t billed remain on the work in progress report, providing the dollar amount of your unbilled costs for your financial statements. It’s all automatic, so there’s very little you need to do.

Sales Tax

Sales tax is calculated automatically on invoices. Sales tax is based on two factors: the client’s sales tax rate, and whether or not the invoice’s billing amounts are taxable. Two different sales taxes can be tracked, such as a local sales tax and a state sales tax. A sales tax report shows invoices and tax you have billed your clients.

There are standard sales tax rates, names, and liability accounts in Preferences. Job tasks are set as taxable/non-taxable in the Task Table. Tax rates aren’t part of the job task; instead, they are part of the client account. The client sales tax rate is copied to new invoices, but can be changed. Changing the invoice’s sales tax rates doesn’t affect the client account. When the invoice is posted, sales tax will be calculated using the invoice’s rates -- not the rates found in the client account. Taxable settings are copied from the job task to the invoice, where they can be changed.

Making a billing amount taxable (or not taxable) only affects that invoice. Sales tax isn’t calculated until posting. Once posted, the sales tax rate and account can’t be changed. Posting creates journal entries that credit your sales tax liability accounts, which appear on your balance sheet. When you write a check to pay your sales tax, the check should debit the sales tax liability account.

Billing hints, tips, and shortcuts

A Progress/Final Billing invoice is the fastest way to bill a job’s costs completely. This option creates the invoice for one job, copying the billing amounts and description from each job task in one step.

Using the auto-billing option for one client can instantly add invoices for the client’s unbilled jobs, without time-consuming data entry.

The job’s specifications can be shown on the invoice by checking the Show Job Specs option, instead of re-typing them onto the invoice.

The invoice’s credit G/L accounts, which track income on the financial statements, are copied from the job tasks. Job tasks, in turn, get their cGLs from the Task Table. If you set up your default cGL accounts on the Task Table, you won’t have to worry about the G/L accounts on new invoices, saving time and making your reports more accurate.

The billing address can be changed on the invoice itself without affecting the client account or other invoices.

A job can be billed to any client. To bill a different client, simply enter a new client number over the old number. The jobs on the invoice will show the right billings, even though a different client got the bill.

See also the Billing FAQ.

A/R invoices and client payments

Clients & Profits X makes it easy to view the payments a client makes on its invoices. The invoice’s unpaid balance due appears at top-right corner of the Accounts Receivable window. It is updated automatically every time a client payment is posted. An invoice’s payment history can be viewed by clicking the Payments button on the A/R window, which opens the Client Payments window. The Client Payments window lists the invoice’s payments, oldest first. For each payment you’ll see the date the payment was added, who added the payment, the client’s check number, and any discounts taken. A list of an invoice’s payments can be printed by clicking the Print button.

Billing Types
Billing type:
Advance Billing	Advances bill jobs from their estimates, before work has begun. Tasks aren’t billed; instead, the client only sees an advance billing amount. You can bill all or part of the estimate. The job’s total billings aren’t affected; instead, it updates the job’s advance billing total. Advance billings can be applied like a payment to later invoices. Additionally, they don’t affect income, instead they credit a liability account (e.g.,unearned income).
Progress/Final Billing	Invoices a job’s unbilled tasks in one step.
Estimate Billing	Estimate billings invoice a job’s estimates, showing tasks. Unlike advances, they increase the job’s billed totals.
Media Billing	This option lists unbilled insertion orders or broadcast orders. Each insertion appears as a separate billing amount, showing its publication, issue date, ad#/caption, and gross cost.
Multi-job Billing	This option lets you bill one client for one or more jobs and their tasks.
Miscellaneous	This billing type invoices clients for non-job charges like consulting fees.
Retainer	Retainers bill clients for account service fees, based on a schedule. They don’t affect jobs. Retainers can be applied as payments to upcoming invoices. Additionally, they don’t affect income, instead they credit a liability account (e.g.,deposits).
Finance Charge	This option invoices clients for non-job finance charges.