This article is an extract from the book 'Everything you need to know about Xero Practice Manager'
Get a copy for your desk at www.linkedpractice.com
Background of issue
When an invoice is raised in Xero, we want these invoices to be captured against the job which the revenue relates to. This is done by capturing either the ‘Job Number’, or the ‘Client Order Number’ of the job in the ‘Reference’ field in the Xero invoice. At midnight each night, XPM will check to see if there are new invoices that have been created in Xero, and sync these to the relevant jobs.
If there is no ‘Job Number’ or ‘Client Order Number’ in the ‘Reference’ field of the Xero invoice, we do not want the invoice to be sent to XPM and create an ‘Adhoc job’ for it to be captured against. This is because invoices are recognised as negative WIP, and we do not want to be recognised negative WIP on jobs that will never have timesheets against them. Adhoc jobs sit in our XPM indefinitely holding this negative WIP balance, which means we will be undervaluing our total WIP figure due to these entries.
Invoices that do not relate to jobs should not be sent to Xero. This issue occurs when the integration between Xero and XPM has been set up incorrectly. Fortunately this is easy to fix.
How to resolve this issue
In XPM go to ‘Business > Settings > Xero’, and scroll to the bottom of the page where you will see the heading ‘KPI/WIP Reporting’. There is a checkbox in this section that says ‘Automatically import invoices from Xero’. Leave this checkbox checked. The problem is caused by the checkbox below that says ‘Create an Adhoc job when no current job matches the Xero reference field’. This checkbox should be unchecked. When the checkbox is unchecked, invoices that do not have matching ‘Job Numbers’ or ‘Client Order Numbers’ will not be sent to XPM.
We then need to consider what we do with all our current adhoc jobs with invoices against them. We delete all the invoices, and delete all the adhoc jobs. Leaving them to sit there indefinitely is not a good option as the negative WIP will still be showing in all our WIP reporting.
Deleting the invoices on the adhoc jobs will not delete the invoice from Xero. If the invoices you are deleting from the adhoc jobs should have been captured against jobs with timesheets, take a look at Chapter 10 - Invoicing under the fixed price agreement section to find out how to send your invoices to the correct jobs.
Timeframe to implement this solution
It will take no more than one minute to update your integration settings. Deleting invoices and adhoc jobs may take 1 - 2 minutes per job. You can speed this up by clicking into the Adhoc tab in the Job Manager in XPM’, and opening multiple tabs.
Enjoy this article? Buy the book.
Need help setting up, fixing up, or getting up to speed on Xero Practice Manager?
We can help at www.linkedpractice.com