"Cash Account" Process

For “Cash” accounts, payment is expected when service is delivered (e.g., like buying an oil filter at Walmart). This is in contrast to “Charge” accounts, where payment is expected after an invoice/statement has been submitted to a customer. For example, jobs where the customer provides a PO for subsequent billing, or completed jobs that are later entered into a motor club web site for payment.

To be handled appropriately in the Ranger accounting process, the accounting “basis” for each account must first be defined for the account. The accounting basis for a customer is configured in “Accounts” – “Account detail” for that customer

Before delving into accounting, it is helpful to review some key elements of the pricing approach in Ranger  * The pricing rate structure for services delivered - e.g., towing, storage - is defined in pricing templates  * This rate structure (pricing template) is associated with appropriate accounts  * For a tow job, the pricing parameters are sent along with the call information to the driver on their mobile device; Similarly for a storage job, a pricing template (rate structure) is applied to each job  * There is considerable flexibility to adjust the pricing of a job, e.g.,

• Adjustments can be made to reflect special circumstances, such as increases/decreases for added requirements or service shortfalls
• Depending on process choices and user permissions, pricing changes can occur both during a job and after it has been completed

 * Given the flexibility for pricing corrections/adjustments in Ranger, there is an explicit step to determine when further changes are no longer appropriate - a decision/action to “Finalize Pricing”

The process below suggests reviewing invoices in this order:

1. Invoices that are “Not finalized”, and that are “Closed” - these will generally be the most recent jobs and the easiest to process - the outcome is usually as expected for “Cash” accounts: payment has been received and there is no balance due
2. Invoices that are “Not finalized” and that are “Open” - these are more difficult as there is a balance due and raises issues, such as: Was the job pricing incorrect? Is there any prospect of getting paid for the balance due?
3. Invoices that are “Finalized” and that are “Open” - these are most likely invoices that have been kept in the pipeline in hope of getting paid. The question becomes whether this remains reasonable or whether to “Write-Off” the balance due as bad debt.

It is suggested that users are active in using the “Invoice review” process - at least daily if not after each shift. The pro forma process for Cash Accounts:

1. Confirm that all accounts have the appropriate configuration for accounting “Basis”
2. In the main menu, go the Accounting menu, and open the “Invoice review” screen under “Cash accounts”
3. The filters enable specific searches, but for the process sequence as outlined above:
   1. Invoice status: select “Paid” (Invoices are “Closed”, no balance due)
   2. Finalized status: select “Not finalized”
   3. Push “Run Report”
4. For these Cash Accounts, the Net Due column will be $0.00 (green) and the Status Column will be “Closed” (green). These conditions reflect expected job outcomes for “Cash” accounts - full payment received (cash, credit card, or check) when the job is completed
5. Review the invoices for accuracy - for example, this could be each invoice one-at-a-time, a “random sampling”, only invoices where charges that look atypical for a given customer, jobs that are known to have potential issues, and/or invoices where a write-off has been required
   1. Further information for each job is available by expanding the row using the “+” button at the left
   2. The current pricing for each job (tows and/or storage) can be viewed by pushing the “Details” button
6. Where necessary, adjust pricing - but only where necessary as any adjustment to pricing will require further action for these “Closed” invoices, i.e.,
   1. Contacting the customer for additional payment, or
   2. Refunding the amount due back to the customer
7. Where appropriate and remembering that this action cannot be undone, “Finalize Pricing”, in one of two ways:
   1. If working through individual invoices, push the “Finalize” button in the “Pricing?” column
   2. Alternatively, go to the “Actions” tab, and push the button labeled: “Finalize all closed invoices”
8. For QuickBooks users, invoices where the decision was made to “Finalize Pricing” and that are “Closed” will be transmitted the next time the process to import data into QuickBooks is triggered

1. Go back to the main menu, go to the Accounting menu, and open the “Invoice review” screen under “Cash accounts” and begin the review of Invoices that are Not Finalized and that are “Open”
   1. Invoice status: select “Open” (there is a balance due)
   2. Finalized status: select “Not finalized”
   3. Push “Run Report”
2. For these Cash Accounts, the Net Due and Status columns will both be red. These conditions reflect unexpected outcomes for “Cash” accounts: Why wasn't full payment received for the services delivered?
   1. Was there a pricing mistake?
   2. Was there a collection problem - e.g., driver did not collect the appropriate amount or did the customer refuse to pay or have insufficient funds?
   3. Are these actually “Charge” accounts (wrong configuation)?
3. The appropriate responses range from
   1. The balance due is inconsequential - “Write-off” the balance due as bad debt
   2. The payment was correct, but the pricing was wrong - correct the pricing
   3. The pricing is correct, and it is appropriate to seek payment from the customer (change to “Charge” acount?)
4. Review the invoices - typically each invoice one-at-a-time and determine the appropriate next steps
   1. Further information for each job is available by expanding the row using the “+” button at the left
   2. The current pricing for each job (tows and/or storage) can be viewed by pushing the “Details” button
5. As appropriate confirm or correct pricing.
6. Determine how to handle any remaining balance due - “Write-off” as bad debt or continue to leave the invoice “Open”
7. As appropriate, lock down pricing (“Finalize pricing”) remembering that this action cannot be undone.
   1. If working through individual invoices, push the “Finalize” button in the “Pricing?” column
   2. Alternatively, after review, go to the “Actions” tab, and push the button labeled: “Finalize all closed invoices”
8. For QuickBooks users, invoices where the decision was made to “Finalize Pricing” and that are now “Closed” will be transmitted the next time the process to import data into QuickBooks is triggered

1. Go back to the main menu, go to the Accounting menu, and open the “Invoice review” screen under “Cash accounts” and begin the review of Invoices that are Finalized and that are “Open”
   1. Invoice status: select “Open” (there is a balance due)
   2. Finalized status: select “Finalized”
   3. Push “Run Report”
2. For these Cash Accounts, the Net Due and Status columns again will both be red. The “Finalized?” column will have checks for each invoice. These conditions place a focus on one remaining issue: Can the balance due be collected from the customer?
3. Review the invoices - typically each invoice one-at-a-time and determine the appropriate next steps
   1. Further information for each job is available by expanding the row using the “+” button at the left
   2. The current pricing for each job (tows and/or storage) can be viewed by pushing the “Details” button
4. Determine how to handle any remaining balance due - “Write-off” as bad debt or continue to leave the invoice “Open”
5. For QuickBooks users, invoices where the decision was made to “Write-off” bad debt and that are now “Closed” will be transmitted the next time the process to import data into QuickBooks is triggered. Note: if payments are collected, these receipts can be recorded in QuickBooks as an offset to bad debt

• The Cash account aging report will show the amount due, by account
  • For invoices where a decision to “Finalize pricing” has not been made, the total amount due by account
  • For invoices where a decision to “Finalize pricing” has been made but there remains an amount due (invoices are “Open”), the total amount due by account by period (from the date of “Finalize pricing” decision)

To Continue

Overview http://www1.rangersst.com/dokuwiki/doku.php?id=support:11_accounting:01_overview

Cash Account Process http://www1.rangersst.com/dokuwiki/doku.php?id=support:11_accounting:02_cash_account_process

Charge Account Process http://www1.rangersst.com/dokuwiki/doku.php?id=support:11_accounting:03_charge_account_process

Invoices - Statements http://www1.rangersst.com/dokuwiki/doku.php?id=support:11_accounting:04_invoices-statements

Implementation http://www1.rangersst.com/dokuwiki/doku.php?id=support:11_accounting:05_implementation