Individual jobs have been set up for each task in Xero Practice Manager

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 this issue

Having individual jobs set up for each task is fine for any work that is billed as a time-charge agreement. This is because the invoices are sent from the job, so the invoice is directly tied to the time sheets. The issue arises for fixed-price agreements because the invoices will not be captured against the same job as the time sheets, making WIP wash-ups very difficult. This issue is very similar to the above issue – time sheets and invoices are on separate jobs.

It is a good idea to stick with one process for all jobs, rather than chopping and changing depending on the engagement type. If your practice has fixed-price agreements, it is therefore best to stick with one job per engagement.

How to resolve this issue

There are two steps to resolving this issue. First you need to implement the correct processes for managing fixed-price agreements, where you only have one job per engagement. Read Chapter 2: Industry Billing Models to understand the various types of fixed-price agreements, then read Chapter 7: Setting Up Engagements. These two chapters will give you an in-depth understanding of how to best run fixed-price agreements in your practice.

The second step is to wash-up all the WIP you currently have. This should only be done once you have completed all the time for the jobs, and all 12 invoices have been captured against the billing job. To do the wash-up, click into the client via the ‘Clients’ tab, then create a new invoice. Select all the jobs that have the time and the invoices against them. This invoice will have a large negative balance in the billing job, and a range of positive WIP against all the service jobs. Change the billing mode of the invoice to ‘Fixed Price’ (at the top of the invoice), then run through each line and update the invoice amounts of the service jobs to make the total invoice equal 0.00. When you approve this invoice, the negative WIP will be washed up against the positive WIP.

Timeframe to implement solution

It will take some time to properly implement this solution. You will want to first understand the information in Chapter 2: Industry Billing Models and Chapter 7: Setting Up Engagements, then put a plan in place for the next financial year. When your next financial year rolls over, you want to ensure you have just one job per engagement, and the billing is ready to be sent to that one job. The amount of time this takes will depend on the number of fixed-price agreements you have in your practice. You can budget 10–15 minutes per fixed-price agreement to properly set this up.

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