New Business Direction LLCNot using progress invoices? Maybe you should be.
Greetings!
The U.S. economy may be picking up, but your customers are probably still being very careful with expenditures. If your company’s finances will allow it, you can help them out on sizable jobs by using progress invoicing, also known as partial billing or progress billing.
You could, of course, simply create invoices for smaller chunks of the job as they come. A smarter way is to build estimates for the entire job or sequential phases so your customer can see the big picture. You can still use progress invoicing to start collecting funds one segment at a time.
How to Proceed
First, be sure you have progress invoicing turned on. Go to Edit | Preferences | Jobs & Estimates | Company Preferences and make sure the Yes button is filled in next to the questions about estimates and progress invoicing.
Now create your estimate (these instructions are for QuickBooks Premier 2013; your steps may vary slightly). Go to Customers | Create Estimates. When you’ve entered all of the items you want to include in this phase of your project, click the Create Invoice button. This window will open:
By clicking one of these buttons, you can bill the customer 100 percent of what’s due on the invoice or just a percentage. But let’s say you and your customer have agreed that payment will be due in pre-defined stages, so click the third button and select one or more of the line items. Click OK. QuickBooks will display a new window that lets you select items and/or percentages of amounts due.
In our example here, we’re going to invoice the customer for two items, the blueprints and floor plans. So we selected the button next to Show Quantity and Rate and entered the full estimated quantity for each item in the QTY columns (if you chose Show Percentage, new columns would appear). It would look like this:
Click OK. QuickBooks will return to your progress invoice, which you can save and print or email to your customer. Your original estimate will remain unchanged.
Tip: If you don’t want any of the zero amounts to appear on the progress invoice, go to Edit | Preferences | Jobs & Estimates | Company Preferences and make sure there’s a check mark in the box next to Don’t print items that have zero amount.
Following Up
When you want to bill for another set of items on this estimate, simply repeat these steps.
Here’s an easy way to determine how much (if any) of the estimate has been invoiced. Go to the Customer Center and select the customer. Click the arrow next to the Show field and select Estimates. Any estimate that has a zero in the OPEN BALANCE column has been completely billed.
QuickBooks provides a report that tells you where you are with all of your progress invoices. Go to Reports | Jobs, Time & Mileage | Job Progress Invoices vs. Estimates. Your report will include the progress invoice you just created:
More Options
What if you determine that you won’t have one or more of the items on the estimate? QuickBooks lets you quickly generate a purchase order. With your estimate open, click Create Purchase Order to select the item(s) needed and generate the form. You can also click Create Sales Order if one is necessary.
Estimates provide a useful way to fine-tune your bookkeeping and inform your customers about impending costs. They can also be confusing if you don’t keep up with them. We can help you determine when they’re a good idea and how to keep them organized. QuickBooks provides good tools here, but they require some administrative control.
This article of QuickBooks Tips and Tricks was based on the 2013 version of QuickBooks.
As entrepreneurs, we work hard for our money, and the last thing we need is to have it disappear due to fraud, hackers, or identity theft. Some people have called 2013 the year of the hacker, which is worrisome. But you’re far more likely to experience risks with disgruntled or financially desperate employees and contractors. Mistakes happen too, and when they do it can be costly to get them corrected.
Here are five ways to increase your financial controls so that you can lower your business risks when it comes to the handling of cash and cash equivalents. As you read the list, check to see where you can tighten up controls in your business.
1. Checking your Checks
Do you have blank checks lying around? If so, reduce the temptation and get them locked up. You can also go a step further and have your accountant run a report each month of missing check numbers. If any checks are unaccounted for, take action by processing Stop Payment orders at your bank.
2. Bank on It
If you are still getting your bank reconciliation on paper, where does it get mailed? The business owner should always see the bank reconciliation before anyone else does. Also, make sure the person that performs the reconciliation is not the same person that deposits the checks. Segregation of duties is essential to improve cash controls.
Today, it’s a good idea to do all your banking online, if possible, so that nothing gets mailed. In that way, you have some reduced risk over identity theft.
Some banks offer multiple-user access to your banking account, so that bookkeepers can get the information they need. Lock that user ID down as much as possible, so that the user can only get to what they need to. If they’re honest, they will appreciate the reduced level of responsibility and consider it a smart financial move.
3. PayPal Protection
If you have a PayPal account, keep the balance low by transferring funds frequently to your bank account. You can also restrict access to reduce your risk.
4. Credit Card Control
If you use credit cards in your business, you’ll want to maintain tight control over them. For each employee or contractor that needs to charge items on a credit card, here are a couple of points to consider:
- If the credit limit on the current card is sky-high, then ask the bank to lower it or set up a new card with very low credit limits just for
employee use. - Contact your credit card company and get a card in the employee’s name.
- Make sure you can access the credit card transactions online. They are immediate, and if necessary, you can closely monitor what’s going on.
- Insist on a receipt brought to you for every purchase.
- Create clear procedures, limits, and approvals before the spending occurs.
- Don’t let the employee “keep” the credit card during off hours. Keep it locked up on your premises instead.
5. Safeguarding Payroll
One of the biggest cash outflows for small businesses is payroll. Here, segregation of duties comes into play again. The person preparing the payroll should not be the one who approves it and actually runs it.
You can do this by having different user accounts and controls within your payroll system.
Hopefully, you already have a lot of these ideas in place. If not, add the ideas you like to your to do list so that your business risks will be reduced.
Rhonda Rosand, CPA has successfully completed the requirements to earn her designation for the ninth consecutive year as a Certified QuickBooks® ProAdvisor.
Certified QuickBooks® ProAdvisors are CPA’s, accountants and other professionals who have completed comprehensive QuickBooks® training courses and met the annual testing requirements in order to 
become certified as experts in QuickBooks®. The courses are designed for accounting professionals and consultants who have a solid understanding of accounting principles.
An accounting professional since 1986 and a Certified Public Accountant since 1992, Rhonda is a one-of-a-kind, live-your-dreams business coach and trainer. She has real-world business experience, well-honed problem-solving skills and an enthusiastic, energetic, can-do attitude. She believes that a successful business stays that way not only by managing its finances well, but also through a proactive plan that includes marketing, strong customer service and long range planning. “Today it is not enough to have a good advisor who works with you once a year”, says Rosand. “The best approach is to actively manage all aspects of your business, all year long.”
Rhonda Rosand, CPA is the owner of New Business Directions. She specializes in QuickBooks® consulting and training services, coaching small business owners and providing innovative business solutions.
To learn more about New Business Directions and QuickBooks®, or to schedule an appointment, please call (603)356-2914, email rhonda@newbusinessdirections.com or visit the website at www.newbusinessdirections.com.
It’s generally a good idea to keep overhead costs low so that your business profits will be higher. This is especially true with items that are easily commoditized and fairly standardized, such as utilities and rent. But there are times when increasing expenses pays off nicely, and here are five areas to consider so you can reap the rewards.
1. Training
Whether it’s for you or your staff, good training can pay back for years to come. Learning new skills, no matter what our crafts are, will keep our businesses from becoming stagnant. Implementing what we learn will help us grow.
You might get training to increase the mastery of your chosen profession. You might also want to consider general business skills, including technology, marketing, finance, and leadership. Just about everyone can benefit from learning more about project management, communications, and negotiations, to name a few more.
You might also want to consider “human performance” skills such as public speaking. Whatever you choose, training is always a great investment that pays back big dividends.
2. T
ools
Without the right tools, the same task can take double the time. It’s a great idea to provide your employees with the most powerful computers and software on the market. The cost of labor outweighs the costs of the computers, so it makes sense to load employees up with the best tools you can. An employee with a slow computer, through no fault of their own, is not giving you their best, and that will cost money in lost productivity.
The same thing goes for owners. You can spend your time fighting with a machine or getting a ton of work done. I’m pretty sure the latter is more profitable.
3. Accounting
The most successful companies we work with invest in accounting services in five areas: accounting technology, accurate bookkeeping, thorough reporting, tax minimization, and professional consulting. When we see business owners cutting corners in any of these areas, it usually costs them more money in the long run to clean up the problems that result.
An up-to-date accounting system minimizes maintenance and troubleshooting costs. Making sure the bookkeeping and reconciliations are done properly is essential for compliance reporting and decision-making. A robust set of reports allows a business owner to make smart decisions about running their business, and minimizing taxes helps you keep more of what you make.
Since accountants see thousands of financial reports in their careers, they have developed an eye for opportunities that a business owner may not see. Bringing an outside perspective into your business is a good investment that can help you discover great opportunities in your business.
4. Marketing
Whatever you do in your business, you are helping others. You are sharing a skill you have that your clients either don’t have or don’t choose to do for themselves. Being a best-kept secret doesn’t help you share your gifts and talents.
Marketing can help you get the word out to people who need your services but might not know about you. Developing great marketing materials will help you communicate what you do as well as receive fair compensation for what you do. It almost always makes sense to invest in this area of your business.
5. Employee Perks and Benefits
Keeping employees passionate about your vision and motivated to be productive is a continuing task. One way to do that is to provide employee benefits and perks that make it attractive for employees to work for you.
There are many ways to invest in your employees. Good health insurance, personal time off, extra vacation time, education reimbursement, flex time, and working from home are just a few of the many options you can choose from to enhance employees’ working environments.
Measuring the Payoff
We can help you measure your return in any of these areas; as always, please let us know how we can help.
If you used small business accounting products in the early days, you know how frustrating it was to print checks correctly from your software. Pre-printed checks weren’t cheap, and you probably printed at least a few that didn’t line up right or were otherwise unusable.
Figure 1: The Write Checks window in QuickBooks 2013.
Printing checks from QuickBooks has gotten easier, and online banking has made this task less of a necessity for many businesses. But when you do print checks, precision is still required.
So to minimize frustration, save time and money, and ensure that everything will be in order when your checks are processed at the bank, it’s important that you use the tools that QuickBooks offers appropriately. If you’ve been having trouble with check-printing or you’re considering attempting it, keep these tips in mind:
- First, be sure you are creating standard checks, not paychecks. Go to Banking | Write Checks or click the Write Checks icon on the home page.
- QuickBooks offers a few options for check creation. Click Edit | Preferences | Checking | My Preferences. Here, you can specify a default account for the Write Checks function. Click Company Preferences for additional options.
Figure 2: Check the boxes here to activate options.
3. You can customize the appearance of your checks. Click File | Printer Setup |Check/PayCheck. Specify printer options and check style, change the fonts in some fields, designate a partial page printing style (using the envelope feed) and add your company’s name and address, logo and a signature image.
Figure 3: The Printer Setup window provides access to your output options.
4. Be sure that your printer has enough toner before you begin a job.
5. If you print a lot of checks, consider dedicating one printer to that task. But secure your blank checks. Don’t leave them in the printer.
6. Does your printer process pages in reverse order, last page first? This can cause problems when you’re printing multiple checks. You have several options here. You can:
- Modify your printer’s property settings in Windows and/or consult your printer documentation
- Load the paper to accommodate reverse printing or
- Alter the check numbers in QuickBooks. Go to Lists | Chart of Accounts and open the correct checkbook register to change them. (This option is the least elegant and most risky, and not something you want to do on a regular basis. Let us help you with your printer setup if you can’t resolve the problem.)
7. QuickBooks supports batch printing. If you’re writing multiple checks that you’ll want to print later, click the Print Later or To be printed link (depending on yourversion of QuickBooks). When you’re ready, you can either select File | Print Forms | Checks or click the Print Checks link on the home page. Both will open this window:
Figure 4: Uncheck any items you don’t want printed to remove them from the batch job.
- Printing a batch of checks and realize that you’ve set something up wrong? Hit the
Esc key to halt it.
- Double-check to make sure that your numbers match before you launch a print job. Compare the number in the First Check Number field to the number of thefirst check queued up in the printer.
- Ruin a check or an entire page of them? If your accounting protocol allows you toskip check numbers, just start over by changing the First Check Number so thatit corresponds with the starting number on a fresh batch of check blanks. If not, you’ll have to create a check for each one that was ruined, choosing a name and account and an amount of $0.00. Then void the check(s). (Click Banking | Use Register and select the account. Highlight the transaction(s), select the editoption and void. Do not delete them.
Check-printing can be tricky, but it must absolutely follow the rules. Let us know if you get stuck or want some guidance upfront – or if you want to switch to online banking and bill-pay.
This article of QuickBooks Tips and Tricks was based on the 2013 version of QuickBooks.
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Tips & Tricks in QuickBooks®
