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How to create staged invoices from an estimate


#1

We sell projects and almost always invoice in a number of stages, e.g.

  • a deposit with the order, (say 20% of the total)
  • stage2: when customer accepts spec, (say 30% of the total)
  • stage 3 when the project is complete and we hand it over to the
    customer. (say 50% of the total)

I like to be able to create an estimate describing the project and showing the total price then an invoice based on the estimate at each of the stages - so there would be 3 invoices related to this project.

I cannot see in the docs how this can be done and I could not find this question in the forum although I may have missed it. We can do this using our current, very old accounting software - Quickbooks - but we need to move to a more up-to-date accounting system

Is this possible and how do I do it?

I do have set up a trial account and have tried a couple of ways, but could not make it work.
Thanks for any advice
Richard


Convert one Estimate into more than one invoice (not recurring)
Request partial payment by DD from an invoice
Taking a deposit
3 invoices from one estimate
#2

So these invoices are not being dispatched according to a strict time frame (e.g. weekly, monthly etc) otherwise I would suggest converting the estimate into a recurring invoice.

I would suggest in this case the easiest way is to convert the estimate to a standard invoice and make copies of that invoice at the intervals you describe. You will still need to adjust each copy before sending to outline what the invoice is for (i.e. stage 2, 3 etc).

You can make a copy of an invoice by clicking the chasing orange arrows on the invoice list.


#3

Hi Glenn,

Thanks for the reply.
I’ve tried it and it works, but it would be much nicer if one could select an estimate, generate a part invoice and have a running total of part invoices. Then when the next stage is due to generate a second part invoice and so on until the final invoice when one tells it the invoice value is the remaining balance.

Any chance of putting this on your to-do list for the future?
Regards
Richard

PS I have a different question which I’ll raise as another topic


#4

I’m not aware that this feature has been requested before so I will convert this thread into a “Feature Request”. If others support this idea we can certainly look at this in more detail.


#7

I think this would help us tremendously as well - facing the same issue about invoices linking to one estimate.
Thanks


#8

I would like this function as well! To be able to issue a deposit invoice then a balance invoice from an estimate. :slight_smile:


#9

If an estimate has say 10 items and you’re creating from that estimate, let’s say a 20% deposit invoice, then later an 80% balance invoice. How would you expect those 10 items to be split across two invoices?


#10

Hi Glenn. Are you asking me?

Sorry I didn’t realise this was an old thread when I commented.

Speaking personally, I create an estimate. When it’s accepted I issue a deposit invoice for 20% of the hire cost only (not always 20% of the full estimate value).

To do this I currently go back to the accepted estimate and duplicate it before converting to one an invoice, tweaked to the deposit amount. Then the other copy is converted to a recurring invoice for the balance set to issue one time only on the due date.
When the deposit is paid. I manually edit the recurring invoice to take account of the deposit payment having been made.

It seems a little bit of a work around at the moment. And I’m not sure how tidy it looks on the client account to have multiple estimates.

If an estimate could be accepted and then perhaps have a payment schedule you can manually input, so you could say, for example, £1000 estimate accepted. £200 deposit due now. £800 balance due 1st July for example.

which would then automatically raise invoices corresponding to that estimate. but allow for different amounts and wording on each invoice?

It a great piece of software by the way!


#11

Thanks for the feedback @Fiona_Gill.

Quite often what you’d do here is simply raise one single invoice for the full amount but request only part payment as a deposit, then the balance later. Putting the full amount on one single invoice means that your debtor control account is accurate as it’s showing the full amount on your books as expected income.

Splitting across multiple invoices would not show your projected income correctly and you’ve also got the problem of how to split up multiple items from the estimate, do you split each line item by x % or do you include a some items on the deposit invoice and some other items on the balance invoice? These factors are difficult to automate in a few clicks.

I think rather than “staged invoices” it’s better to look at solving “staged payments”, that way you don’t have all the headache of splitting up invoices.


#12

Glenn,

As I see it the problem with issuing the full invoice is that the vat becomes due in that period unless you are on cash accounting. Also if the products are supplied in stages this further complicates the accounting as you have not supplied the products and possibly not received or made the final products so they should not really show as value on the balance sheet.

While it is true that it would be nice to see the balance owed against a project that would require a higher level of project management that is currently part of QuickFile.

Keeping this simple we convert the quote to an invoice within the text of the invoice we detail the overall project costs and payment stages and have one billable line stating “this invoice is for…20% deposit” Then at the next stage make a copy of this invoice and change the billable line “this invoice is for…60% stage payment on delivery”

The billable lines can detail items or summarise the stage as you see fit but to automate things to meet every scenario would require a separate PM module.


#13

Creating an invoice that shows a lower billable amount is fine although it doesn’t solve the splitting issue. This comes down to what ledger entries you post on the sales code within your accounts. If you have 10 items on your estimate all posted to different sales codes, how should the first deposit invoice be apportioned in terms of nominal postings? You somehow need to make fractional postings on each nominal which introduces all kinds of rounding and adjustment problems, particularly when you have multi-currency involved or different items with different VAT rates.

Also there’s a problem issuing VAT invoices for the full amount, with a lower amount due figure, then creating additional invoices later under a different invoice number with that same total amount. This could potentially allow clients to reclaim more VAT than what they are entitled to and would almost certainly not conform to HMRCs own rules on VAT invoices.

However the invoices are displayed the splitting problem remains and this is something that works at a very fundamental level in QF, so it’s not an easy problem to solve.


#14

Hi glen. Thanks for your response. I appreciate that it would be tricky to achieve a solution to this to suit all the different types of services your clients provide.

For us we don’t need to allocate or split products to each part of an invoice. Our deposit is a percentage of the service we will provide.

We are a hire company, mainly servicing weddings, so our deposit invoice secures a booking which may not actually happen until 2 years later. We don’t count the expected income from the rest of the estimate using QF as it isn’t actually due until the time of the event so we don’t want to have it showing as bad debt or trigger vat reporting until the appropriate time.

Also a customer has the right to cancel, so until the final amount is due there is no guarantee the income will actualise.

I’m happy with our work around as it produces the figures I need at reporting times.

F :slight_smile:


#15

In my situation it is simple to solve. I have a quote, I convert it to an invoice with 50% due on receipt and the remainder due on completion. It it is highly unlikely that it would be posted to anything other than general sales. None of the other issues apply either, as they probably don’t to quite a few, if not most people requiring this feature. Could this be implemented so at least us simple people could use the feature?

For the more complex users could you not switch it around, and set an amount due made up from whatever the rounded totals of the invoice lines are? This would mean that you don’t have to round multiple lines/nominals/currencies to get an exact percentage.


#16

What we don’t want to do is rebuild complex scheduling logic if we can leverage something that already exists. We have recurring invoices, so to get anything like this working we need to build on top of that. However even then recurring invoices deal with fixed repetitive amounts, so it won’t work in the example @briggers provides where there’s a 30% and 50% balancing invoice.

I still don’t see technically how this can be achieved easily without creating a lot more background logic or allowing users very granular control over how the original estimate should be split up, which means more complex UI. To get something that works would involve limiting it’s use so much that I don’t see that it would be a great return on the development resources invested.

I still think there’s a solution here, I just don’t know right now the most solid and reliable way to implement it.


#17

Hi Glenn,

I was looking to post a feature request around this area, but since one is already open I thought it best to add my thoughts here.

For me, I often issue estimates which contain multiple services. For example (for our graphic design work) we might include design of Letterhead, Business Cards and a website, plus printing of the Letterhead and business cards.

Often these are completed at different times - i.e the Letter Head and Business Card are designed and printed, but the website isn’t completed until a few weeks later when we get the content from the client.

For me the option to open an advanced dialogue box and say per line on the estimate “invoice X qty of this line”. For example (I hope the table displays ok):

  Quoted To Invoice Remaining
Letterhead 1 __1__ 0
Business Cards 10 __5__ 5

In the “to invoice” box you enter a value up to the number quoted and remaining would be reduced. Therefore you could invoice some lines and not others, and indeed invoice part lines.

This is effectively what Sage Line 50 does (or at least used to when I last used it). They also allowed decimal ‘To Invoice’ values although this is more complex and I’m not sure is necessary.

In the backend you would need to track how many items have been invoiced which I assume would require an extra database field, and a new interface / pop up for the form - but shouldn’t need to be too complex. Possible also adding an new status of Part Invoiced would also make sense.

For those invoicing in stages, the estimate could be split into multiple lines. For example the original poster on this thread could create an estimate with 3 lines and then bill each line separately. Or the person with the deposit could have the deposit and balance on separate lines.

You could even leave the existing system as is (so most customers don’t see an extra screen) but have an ‘advanced invoice’ link for those of us who do need this. This also allows the potential to report on how much work is on the books but not yet invoiced (i.e. Work In Progress calculations).

Sorry for the long reply!


#18

Thanks for your input @jeaston. I don’t really favour introducing more controls to schedule invoices from estimates, it’s extremely difficult gluing them all together with existing dependencies and it’s not possible to satisfy all requirements without adding significant complexity to our code-base.

What happens when underlying estimates change, e.g. nominal codes, VAT percentages, discounts or when scheduled invoicing dates are updated, estimates cancelled or cloned? There’s a great deal of work that needs to go on to maintain consistency and this is where the challenge lies. Even if the technical hurdles are solved it’s still not likely to fulfill the requirements for a good percentage of users.

Personally I believe this is a whole domain in itself and belongs in your own back-office system with an API link to trigger the invoices in QuickFile. We are in the process of building a marketplace for 3rd party Apps, so I think this would be a great use-case.


#19

Hi Glenn,

Just to clarify, I wasn’t thinking about anything being scheduled or automated. Just the ability to choose to invoice part of an estimate today, and another part tomorrow.

At present I create an invoice from the estimate, delete the lines that don’t yet apply and then mark the estimate status back to accepted (unless of course that was the last invoice for that estimate). I therefore have to track what has been invoiced and what is outstanding.

Ultimately I may be better off designing my own system if a simple multiple invoices to single estimate system is to complex for QuickFile.


#20

I agree with the point raised by @jeaston: it would be very helpful to have a way to know how much of the estimate has been invoiced and how much is still outstanding.

The system should be able to track that and allow partial invoicing from a single estimate.


#21

We need to be able to do this too, at the moment we don’t convert our estimates because a lot of the time we will be raising more than one invoice for that piece of work


#22

Has anything changed or improved in relation to this thread
I could also do with the ability to invoice part of an estimate 50% as a deposit as said earlier in this thread most of our invoices go in general sales.
I have tried playing with the invoice but can’t find a solution without having the remainder showing as an outstanding over due invoice