All Money In entries are not the same! When your clients give you a payment, the first thing you need to do is to figure out what they are paying for. Once you have this information, you can enter the payment on the Money In page.
Luckily, the steps are helpfully numbered. Step One is important. You will notice that the field defaults to “Receive and Apply.”
Receiving and Applying are two separate actions. Receiving is recording that the money was deposited into the bank. Applying is to attach the payment to the specific items on proposals and invoices that the client is paying for. Studio Designer is giving you the option to do both actions at once.
If your client payment is a retainer, or money to be held on account, you should choose “Receive client payment” from the drop down arrow. You will only be receiving the money into your bank, but not applying it to anything.
Instead of applying the payment to an invoice or proposal, the client payment will be held “on account” for that client. In Studio Designer-lingo, money held on account, is called Funds Available. Money held in Funds Available can be applied to proposals or invoices later, by coming back to this page, and choosing “Apply Payment from Funds Available” from the drop down menu.
The Money In Page also has a very useful summary of the client’s money situation over to the right.
The top line (red arrow) is the total you have received from the client. The next three lines (green arrows) show the current breakdown of that total. Proposal deposits are payments on proposals which have not yet been invoiced. The Funds Available amount (blue arrow) is the amount “on account” which has not been applied to anything yet.
Quick tip – keep your eye on this summary. If you have a negative Funds Available, you have applied
more than you have received. You will need to un-apply something. If you have amounts in Funds Available, and the project is completed, you can opt to return the remaining funds to the client, or you can apply that amount to a final invoice. If you have proposal deposits, remember these need to have final invoices created – review your project and create invoices for completed items. ALWAYS check this summary at the end of a project to make sure there are no remaining Proposal Deposits or Funds Available.
Lastly, there is a report that shows these numbers for all clients. The report is in the Legacy Report section, report 5040 Client Deposits.
I strongly recommend you review the Client Deposit report in November or December, and write off or close out any balances that are not correct, so that your year end financial reporting and taxes are correct.
As always, please feel free to reach out to me or my team if you need more information or help with cleanup of your client deposits!