Project management Accounting -16

for

for hello everyone welcome back again for

the project management accounting basics in this session we are going to discuss about uh Advanced project

invoicing that means uh customer retention customer retention in the

sense so for example uh total amount of

invoice is 1,000 rupees and we have uh we have to pay 90%

10% we cannot raise a we cannot raise bill because customer

need to check the quality of the work so once he check the quality of the work

once it is done and they will release the they we can raise

uh billing for that 10%

customer will be withhold part of the payment to a

vendor so example customer will pay part uh part of the invoice up front but

wants to review the work or inspect the product before paying the full invoice

so that means before paying the full invoice he want to check the work so the that is

customer retention process how it will work means

for this uh setup for retention is number

sequence which is available in the parameters project management parameters

you all know that ledger settlement retention terms required retention

category required and once the assign the retention to the project or contract

or building Ro we have three possibilities we can uh

assign the reention then update the percentage

completed so let's get started on this

process

for example I'll take one

project

I'll take one

project where we need to assign the uh retention terms in the project level is

if you go to Project we have the tab called payment

redention

terms this is the

one let me go here here project

contract see funding

source if you add

this customer retention this creation of uh

customer retention I'll show

later

uh otherwise let me create new project

custom see funding source it is there it's came

uh funding source and all based on the

contract in the contract funding soures this is the funding source

assigned at the contract level so it came uh here contract level nothing is

assigned customer payment redention so it's came as a blank here as as well

project management project Master

itself for example I'll create I'll check this setup

first customer

retention let me use the existing

one so this is the one they mentioned customer retention

percentage percentage of work complete customer pay

the

10% okay so now let me create one

Journal

oh sorry project is in

created change the stage project

stage

no so let's so I'll book 10

hours Post

State

so go back to the project man has tab andice

proposal

click okay no invoice transaction okay sorry

selected so selected click

okay once the invoice lines are selected you'll get the invoice

form here you can see customer rtion total amount is

3,500 hours 10 hours into 350 is the sales price

3,500 and 10% redention ratio it is

350 okay so once you posst the entry

invoice so it it will book to the customer only

3,150 as billing we are generating and whatever the 350 it goes

to retention account so I'll show you

that I'll show you in the invo

journals and

V see here 3,500 project revenue and 3,00 150 only

it's went to the customer balance okay 350 it's went to customer

retention whenever the retention uh release then it will go to

uh customer invoice so how to do the retention

release uh in the manage tab we have request retention amount so this is the

retention amount that we date and click on create invoice proposal now whatever

the previously it booked to retention account that will be credited and

customer will be debited once you post this invoice so check the transaction

and post

it once it is

posted you can check the invo I

said so this is yeah this not this one this

one yeah this is customer

retention let's check the VES sorry this

one

go to the V now see here now customer balance debited and retention

credited so what are the setups required for this customer retention is uh first

is member sequence that is everyone knows in the customer uh project

management parameters we have uh number sequence Tab and it will generate the

number sequence that I'm not going to discuss I'm skipping that as everyone

knows it so this is the place and next is that

category I'll just review the

categories um check the

retention category customer

retention how they designed so this is customer

retention just

loading

go to Project

categories see here so here name and disc using expense or

production they didn't selected anything thing let me open

duplicate I select

new

soest customer retention uh

and you

have

for so C

selected so categor is

V

oh sorry before this uh I'll show one more why it is not coming customer detction

field means let me go to

parameters I

think

project management

parameters the project management parameters we have

um

where it will be not in

the ren

options

for I think something I

miss so actually customer retention customer

payment retention this field will be there this need to be

enabled then it will be applicable for that uh customer

retention

I miss somewhere

one

I think under project sorry this this all two are enabled only

okay I'll tell this field how this comes here

and the later session maybe so this field need to be enabled

while creating the categories

uh your system administrator must be created customer retention category and

the category must be assigned to fee transaction type

so this is one thing we need to do and another one is uh when we post the

invoice it is booking to the customer retention account right so where that

main account has been set up it is in the GL accounts for

automatic transactions and we have

here let payment detction this is the

one so these are the three setups required number sequence category uh we

need to select fee category and uh customer payment reference tole need to

be enabled in the category then uh customer retention purpose main account

supposed to be

mention

and creation of customer retention terms that that will be from the project

management accounting and we'll have

uh retention customer payment

retention so this is the place where we can Define the

customer so you can Define like 50

75 100 like this as well if we

have so for example 50%

10% and

75% 5% till until 100% 3% for example like

this so we can create number of retention

terms create project uh next is that uh project contract level how to assign the

customer retention if you go to contract

Level under funding Source tab we have

retention percentage as well if you go here funding here you can assign

this and next is that bulk project invo sying uh we can

do inv

so here from the create project invoice proposals you can do from

here and you can select the parameters that you want to post it and select the

which type of transactions we did all the things based on that you can run the

pro

and one more thing is that when you have billing Rule and when you doesn't have

billing rule how the invoice proposal work uh for example we'll go with

project contracts so building rules we have

uh progress type progress type means contract value build based on the

percentage completed uh unit of delivery type contract value build based on uh

units delivered Milestones Milestone payments uh time and material build

based of time and material fee fee added to the other building rules

charges so let's see this this one having building rule I

guess this project ah not there when when the

billing rule is not there let's try to do the invo proposal for this

contract you see here it is Project transactions

okay just comparison and second

and I'm checking it second contract so this is also not

having okay Milestone cont maybe this is having building rule I think we created

this

one yeah these are

manys now if we try inv

proposal see you'll get the billing rules not the project

transactions okay that is the difference that I want to show

here so how to do the invoice for the building rule uh we already

discussed if it is Milestone update the Milestone payments uh those type of

stuff I'll just show you the proc process to do the manage contract

status and you'll get the building

rules and you need to update here update Milestone status units delivered for

this time and [Music] material and fee this is the fee one

time material anyway it's built if it is progress percentage we

need to if it is unit of delivery units and person Milestone you need to update

Milestone status so I think we discussed already about

these

things and next topic is that uh project free

text invoice so first uh project contract and

project need to be reviewed and air parameters

uh

so we need to define the project let's

take free text

in

contract created I'll do the project as

well

project retext PR text invoice only applicable

for uh time and material

[Music] and here let me release this

project

okay after this let me pause

the

now

so after this I'll go to air

parameters

so we have project I need to enable these two fields

and let me go to the free text inv I forgot the

project okay name is I remember the

name text inves

take new select the

customer for [Music]

example I'll take uh another

one 63 maybe so this

one select the main

account

go to the project project

tab here here you can

see pre text in

project so on see automatically Fe setup game and Main account also

changed

if you select other than the time and material project you'll get the error

message

for

so go to Project to check the

transactions Min stab poster

transactions see here you can see one more fee

transaction which is fully

invoice you can check the vulture here itself

so

okay and I'll show you one more thing this contract if I go to this

contract now whatever the customer that we selected at the time of pre text invoice

that will be added in the funing S 63 is that okay so uh next is that uh

project invise workflow that you all guys know how the project uh workflow

setup can be done I'm not sure in my system it's not

working for me to explain this workflow

thing so I'll stop here so and I'll come up with new topic in the project

management accounting in the next session so this is

what okay this is for invoice

proposals it's not working for me I'm not

sure who will help me on

this I am getting the Forbidden error while opening the

application

for

so I'm getting like this so not able to show that topic and we workflow is

everywhere same so I'll stop here thank

you