Collaborate on Open Invoice Example for Planning with Ease Using airSlate SignNow

Open invoice example for Planning

hi this is Paul Crutzen CPA with law firm velocity we are looking at payment plans within QuickBooks Online and then also practice Panther so a lot of the practice management systems have released tools that you can use to manage payment plans a client signs up for 3,000 dollars worth of work and we're gonna charge them $1,000 once a month for the next three months in order to collect that three thousand dollars so the two tricks that we need to happen within these payment plans is one is we need a system that we can reliably ensure that the client is charged for these scheduled payments and then we also get feedback when payments are declined so we can pursue the missing payments and then the other piece is we need to use reports to manage the overall balances due from clients that a lot of the payment plan systems you can set up the payment plan but there's no transparency as to what do clients still owe us so we're going to use this example open invoice report from QuickBooks so I'm running examples for three different matters that we're going to walk through today so the first is for client a and yes I realize client a is not included on this screen and that's kind of the point that client a is kind of using the default system that practice Panther has set up for payment plans and we'll jump over there and a second show you why it's doing what it's doing but under the default system when you run an open invoice report the client is invisible we have no idea how much money they owe us and if they've been missing payments or not these second eye so a couple workarounds is first option is that we will create a one-time lump-sum invoice for the total amount of the fee to be received from the client so in this case we have a fee of three dollars and three cents we expect to get respect from the client and as we receive dollar payments every month that this balance will just slowly decrease the trouble was this is a client could make the first payment and miss the next two payments and we really can't tell if the client is on schedule or not based on looking at this one line so then the other option is to create a single invoice for every expected payment so here we have invoice dated August 12th we expect this payment to come in on August 13th and we have this other invoice we've created when the client engaged the firm and we expect this payment to come in August 20th that now as payments are received we apply the payments to the invoices and they fall off the report with this process we can run the open invoice report and we can look for things look for items with due dates that are in the past and we can kind of get a feel for how each client is paying the downside of this is you have to manually create each of these invoices in Panther and word and then there have to be some sort of steps to apply payments received to these invoices so client B when we do one invoice for the total engagement it's not so bad clients see if this payment plan was 18 payments that someone was gonna have to make 18 separate invoices and that's not gonna be amusing so let's jump over to Panther and see what's going on with these payment plans so here's our client a payment plan what does this set up is we are expecting to get a dollar a week until we receive three dollars behind the scenes I'm actually running these as real payment plans against a credit card or a prepaid gift card so we can do a second video to show what these transactions look like so practice panther is going to go ahead and automatically charge these three payments and what gets us into trouble is when you sell it we've selected this create invoice box so what Panthers gonna do is win on August 13th when the next payment is due Panthers going to make an invoice for $1 and then apply the payment to that invoice so within the same day we get an invoice for the one payment and the invoice goes away or it's paid so it falls off the accounts receivable report the trouble with this is Panther is not making the subsequent two invoices where the client was gonna owe us another $2 in the future it makes those invoices when those payments are actually received so using this process means we're not going to see unpaid balances on the accounts receivable report let's click over into another payment plan so this is client B and so this is where I manually created an invoice for three dollars and three cents for this for this matter and so down here we have create invoices is unchecked so Panthers gonna go ahead and charge a dollar one every week for the next three weeks until this is paid and then those payments are going to flow in through law pay and we'll have to see how they post into Panther but there's going to be some activity on our side to apply the payments received against the invoice and the same thing works with where we create for clients see where we have the separate invoices that we'll have to apply the individual payments to the divisional invoices and with that that's kind of an overview of how we are seeing payment plans within Panther and other practice management systems that our preference is to take the time and set up an individual and voice for every payment we expect and that way we can use the open invoice report to monitor payment progress thanks