Where Did the Money Go?

By Mark E. Engelberg, TimeLinx 

Part 2 of 2 

In Part 1 of this 2-part series “Leaving Money on the Table? The 5 (or 6) “Billing Modes” in TimeLinx”, 5 of the 6 Billing Modes in TimeLinx were reviewed.  

Immediately from its first release in 2001, TimeLinx was designed to maximize service revenues and profits, control costs, and deliver work. There is no point in taking on a job if you couldn’t control and give yourself the best chance of a profit.  We called the feature Revenue Optimization. Having the flexibility of setting unique rates when you serve different customer sizes, industries, geographies, or other situations, is an important advantage when growing your business.  Gone are the days of “one rate fits all” because it’s too complicated to track and invoice who is paying how much. Simplifying rates makes billing easier but leaves money on the table.  Valuable specialized expertise is being provided but a standard rate is being charged to simplify billing. 

The functionality easily manages multiple rates for each customer, job, task, and consultant in scenarios like technical certifications, task and difficulty levels, task type, weekends, holidays, and more. This provides independence from customer to customer to remain competitive, maximize your revenue and value, and keep customers returning for more. 

The Billing Mode controls where TimeLinx looks up the factors to use when calculating the rates and costs for the work performed.  For all the details, read the first article here in this 2-part series where the primary five TimeLinx billing modes are covered: Project, Task, Consultant, Customer, and Fixed.   

So, what’s Billing Mode #6?  Retainers.  A Retainer is not actually a Billing Mode – it’s a financial transaction. When you receive retainer funds (which means payment in advance for work you haven’t delivered yet), generally accepted accounting principles require that payment be shown as a liability in your financial records. The balance should be up to date at all times. If you don’t deliver the work, you are supposed to return the unused funds. And you are not supposed to recognize the revenue until you’ve delivered the work.   

Understanding how much of the customer’s money is being held at any given time comes in very handy when the phone rings looking for an answer to that question.  If bookkeeping is done properly, someone would look in the accounting system for the answer. But they won’t be able to answer the next question which is “What was done to consume it?” “What tasks were performed on what job at what rates and by whom that caused my funds to run out?”  The accounting system won’t give you those details.  

But TimeLinx will, without anyone needing to bother the finance department as it’s all in TimeLinx and linked to the customer and the jobs.  

A Retainer can be tied to one or allocated against several jobs simultaneously for the same customer. Perhaps a system implementation is being delivered the payment is to come from the customer’s Retainer.  At the same time, technical support is being provided for the implementation while delivering work for a second site location. You want all three funds to be tracked separately. Or multiple properties are being constructed and tracking expenses against each one is needed. Every Retainer can be linked to multiple jobs at once and TimeLinx will handle the rest – keeping track of what jobs consumed which funds and what tasks were done – even at many different rates, using different staff, and performing different work on each job. 

Naturally, there’s a point when a Retainer gets down to zero and additional funding is needed to continue the work. TimeLinx tracks that and can notify the customer at a predefined replenishment balance, and how much is needed. Internal settings control how much replenishment, by dollars or percentage, is needed to “top up” that Retainer account, and an Alert can automatically send that information.  The logic supports multiple currencies, too. 

Retainers also have start and end dates so if funds are not consumed by a certain date, they are no longer available. And dates also control rate changes that can happen on a particular date based on the TimeLinx Contract attached to the Retainer. 

As funds are consumed, TimeLinx Alerts can notify staff and customers of the usage on a daily, weekly, or monthly basis.  

Additional funds can be deposited at any time with identifying details such as account numbers or check numbers. Statements can be run to list the individuals that did work on behalf of that Retainer, what rate they were charging, and the real-time balance of that Retainer. Expense outlays can also be tracked and applied to that Retainer as the work progresses.  It’s all happening as the work progresses rather than paying finance staff to put the numbers together after the funds have run out. 

When was the last time a payment was promised that never came?  At least, not when it was expected. It happens, so Retainers can be set to “allow negative.“ Perhaps the customer is nearing a zero balance and the payment hasn’t arrived. In this situation, set the Retainer to allow a negative balance rather than putting a hold on the work. TimeLinx will track the Retainer negative balance until a deposit is made.  Customers appreciate actions like this!!! 

And finally, even our TAP ( TimeLinx Accounting Platform) gets into the action by creating optional pathways for accounting systems to pass information between TimeLinx and your accounting system.   

The bottom line?  When your customer nicely asks, “Where did the money go?”, you can say “We have TimeLinx. Give me 5 minutes and I’ll send you a report.” 

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About TimeLinx
TimeLinx delivers innovative project & service management software as a complete solution that perfects the sell-track-manage-support-bill cycle that services organizations must have to delight their customers; TimeLinx brings the cycle together in a single application that offers less frustration, better project management, complete reporting, and improved profitability – all specially designed for Infor and Sage.