You can create and track Retainer and Prepayments for Projects.
The terms 'Retainer' and 'Prepayment' are used here interchangeably and you can define your own terminology.
You can create prepayment invoices for Projects and/or Project Lines.
The prepayments can then applied automatically to time+material invoices.
When you create a prepayment invoice or apply the prepayment, the project Unearned Revenue Financial Account is used to track and report open prepayments. You could create Revenue Recognition entries manually for the time between prepayment and invoice if necessary.
You can also create and apply prepayments manually by selecting a Liability account in the Invoice Line.
In the Tab Project, for any record - click on Retainer in the record actions.
It automatically queries all prepayment and standard invoices for the project and shows the total amount of the Open Prepayments. You can also restrict the search to a particular Phase or Line.
If you have Credit Memos created, they will show up here too.
Create Prepayment Invoice
Check and enter the values for
- Document Type - defaults to the first found Receivables and Reversing document type
- Unit Price - the prepayment amount
- Fin Account - the first found liability account for the unearned revenue account. It is saved in the Project for future invoices.
Provide the other optional values and click Create.
After this, the Project section is updated. You can create as many prepayment invoices as required at any time.
Create Time+Material Invoices
As the next step, create Time+Material Invoices< In the tab Pre-Billing, select the Project (and project line).
In the Summary Project Invoice Info section, you can see the available Prepayment Amount:
After clicking on Create Invoice you can see in the Create Customer Invoice dialog:
It shows that the prepayment was applied, resulting in a $0 invoice.
If you don't want to apply the prepayment to this invoice, just de-select the line created.
The description in the line created is defaulted from the Settings (see below). You can also change the applied amount.
When going back to the Tab Project - Action Retainer, you will see the new invoice.
For this example, we create another Invoice.
In the Pre-Billing Info, you'll see that the remaining amount will be applied:
And in the Create Customer Invoice dialog, the adjusting line:
When going back to the Tab Project - Action Retainer, you will see the entire history:
What terminology you use is defined in
Setup > Custom Settings -- Manage Accorto Settings
Search and update
- Retainer Name - default: Prepayment - set it to empty, if you don't want to see prepayment info.
- Retainer Invoice - the default description of prepayment invoice lines
- Retainer Applied - the default
By default, we create an "AR Credit Memo" Document Type. You may want to rename it or create additional types with
- Receivables - selected
- Reversing - selected
Note that the name of the document type is used in the Invoice.
Financial Account - Unearned Revenue
If not existing, create a Fin Account with the Account Type of Liability. By convention, this is called Unearned Revenue. You can have multiple accounts to differentiate scenarios.
The first found Liability account is suggested in the Prepayment dialog. It is saved by project for future use.