Retainers

Overview

Retainers are advance payments that you can request from your clients. They are pre-payments that are usually requested before work begins and then used against future billings or for the final invoice payments. However, retainers do not have to be necessarily requested in order to be received. Similarly, retainers received are not directly connected to retainers requested.

As retainers represent advance money received but not yet earned, they are considered a liability in accounting, even though you deposit this fund in the client's account. Core recognizes a retainer and makes it available for application only after you record it in the Payments screen. When it is applied to an invoice, only then is it recognized as an income. Typically, you apply a retainer toward the end of a project on the final invoice. However, depending upon your accounting practice, your company can regard it as an income when received. Also, if retainers are non-refundable, they are recognized as income when the client pays them. Unlike standard invoices, a retainer payment does not apply to a specific invoice; it just debits the retainer account. Click to watch this video on managing retainer in Core.

Retainers are commonly used in the legal industry where law firms deposit retainer payments into trust fund accounts and are required to manage each client’s retainer payment separately. It is also common in the construction industry. Attorneys are the fiduciary of the IOLTA bank account, which is a trust fund account used to deposit the retainer payments, settlement monies, money for case costs, future services and expenses, etc. by the clients. Most of the industries, especially architectural and engineering, consider retainer as a security deposit and use it at the end of a contract. You might be having clients who pre-bill for all their work or offer pre-paid services. Typically, they use fixed fee contract types involving monthly, quarterly or annual billing. In other words, there are no time or expense entries when they issue invoices. You can handle this situation by sending the clients a retainer invoice at the beginning of every month. Then internally create a regular invoice at the end of the month for the same amount and apply the retainer received. This results in a zero dollar invoice, which you do not email to the clients. However, the time and expense entries link correctly, giving you the correct realization rates and accurate write-up/write-down values. Clients can pay the retainers electronically using the online payment option (ePayments).

Retainers are of two types:

  • Client Retainers: Client retainer is an advance payment received from a client and is available for all the projects of that client. Whether Core classifies the amount received as a client retainer or a project retainer depends on how you record it. When applying retainers to the invoices, project retainers are to be used first and then client retainers.
  • Project Retainers: Project retainer is an advance payment received from a client for a particular project and can be applied on that project only. Whether Core classifies the amount received as a client retainer or a project retainer depends on how you record it. When applying retainers to the invoices, project retainers are to be used first and then client retainers.

You can memorize retainer invoices and schedule them for automatic processing on a user-defined frequency. Core allows you to set a minimum retainer amount for projects and then tracks it for you for automatic retainer invoices. Core allows you to transfer retainers between projects of the same client as well as different clients.

Field Descriptions

Basic Tasks

Request Retainers

Apply Retainers on Invoices

Advanced Tasks

Memorize Retainer Invoices

Email Retainer Invoices

Preview Retainers

Download Retainers

Change Online Payments

Show/Hide Columns in Grid

Transfer Retainers

Refund Retainers

Mark Screen as Favorite

Field Descriptions

Field Name Field Description
Retainers > List View >
Reference No. Reference number for the retainer payment received from a client. It becomes the retainer invoice number.
Used Retainer amount used or applied on invoices. Any retainers refunded are also displayed in this column.
Type This indicates the type of invoice or transaction listed, such as retainer invoice, trust fund invoice, trust fund received, retainer used and so on.
ePayment Indicates whether the ePayments option is turned on for the retainer invoice or not. If not, you can turn it on individually in the detail view or in a batch for multiple invoices using Batch Update.
ePayment Status Displays the status of the ePayments for the invoice if that option is enabled, say CC Processed for credit card processed. In case of ACH ePayments, the status displays ACH Initiated after the clients initiate ACH transfer on the ePayments Portal; it then changes to ACH Scheduled or ACH Processed.
Retainers > Details >
ePayments

Core allows your clients to make online payments using the ePayments feature. You can check this option for the retainer invoice here and then select the Online Payment Account from the drop-down. IOLTA account is available only in case of trust fund invoices. You can also set it up at the Global Settings level for all clients and projects.

Core allows you to select multiple online payment accounts. However, you cannot choose two payment services with the same payment method. You have the ability to access the ePayments Portal directly without having to open an invoice and click the Pay Now button. You can quickly process the payment if you have the client's credit card on hand or copy the payment portal link and email it to your client without visiting the portal.

 

Request Retainers

You can request a retainer from your clients for all their projects (client retainer) or any specific project (project retainer). You can create retainer invoices for the parent projects and later apply the retainers to the phases. The retainer invoice is stored as reference information for the project; it does not record any retainer payment. You can also create trust fund invoices here for projects that have trust fund accounts assigned at the project level.

To request a retainer from a client, watch this video or follow these steps:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. Select a Client or Project from the respective drop-downs, depending on whether you want to request a client or a project retainer. Then click Request Retainer.

    2. On the Request Retainer dialog, enter the required information:

      • Date

      • For: Client or Project: If you choose Client, you are requesting a retainer for all the projects of that client (client retainer). If you choose Project, you are requesting a retainer for a specific project of that client (project retainer).

      • Reference Number: Reference number for the retainer payment received from a client. It becomes the retainer invoice number.

      • Is Trust Fund: You can check this option if you want to request a trust fund payment from the client. This option is available only for projects that have trust fund account assigned at the project level.

      • Amount

    3. You can turn on the ePayments option by checking: Allow online payments for this invoice. Then select the Online Payment Account that you want to associate with the retainer invoice. (Core allows your clients to make online retainer payments using the ePayments feature. You can check the Allow online payment for this invoice option for the retainer invoice and then select the Online Payment Account from the drop-down. IOLTA account is available only in case of trust fund invoices. You can also set it up at the Global Settings level, which is then inherited at the client, project and retainer invoice level.)

    4. You can change the client address by clicking Edit Address and entering the new address.

    5. Click Process or Process & Preview.

Note: In case of client retainers, the memo entered here is passed on to the retainer invoice as ePayments memo, when enabled.

A retainer invoice (or trust fund invoice) is created for the client. You can view its details in the detail view.

Apply Retainers on Invoices

From the accounting perspective, when retainers are applied on invoices, such transactions debit the unearned retainer account and credit the A/R account. After sending retainer invoices to clients and receiving the retainer payments, you can apply them to invoices in several ways. Click to watch this video or read the following information:

    • On billing records and manual invoices in the Invoices screen. See Apply Retainers on Invoices for more.
    • On billing records in the Billing Schedules screen. See Add Retainers to Invoices for more.
    • On outstanding invoices (A/R) in the Payments screen. See Apply Retainer Payments for more.

Memorize Retainer Invoices

You can select an existing retainer invoice (or trust fund invoice) and then memorize it for future processing. You can memorize retainer invoices from this screen as well as the Recurring Invoices screen.

To memorize a retainer invoice, watch this video or follow these steps:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. Select a retainer invoice on the grid that you want to memorize and click  to select Memorize.

    2. On the Add Recurring Invoice screen, make sure to select the Billing Type as Memorized Retainer Invoice.

    3. Enter the required information and click Save. See Recurring Invoices for further details.

In the same way, you can select and memorize a trust fund invoice.

 

Email Retainer Invoices

If the ePayments option is enabled, clients can pay the retainer invoices electronically using the online payment option on the retainer invoice PDFs as well as in the body of the emails.

To email a retainer invoice, watch this video or follow these steps:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. Select a retainer invoice on the grid that you want to email and click  to select Email.

    2. On the Compose Email screen, enter the required information:

      • To: You can send an email to multiple recipients and also copy them using the CC and BCC options. You can click on the Choose Contact icon to open the Address Book and select multiple individuals or groups to email. However, if you are using a trial version of Core, it does not allow more than 3 distinct recipients at a time. For paid subscriptions, this limit is 50 recipients at a time.

      • Subject: Subject line of the email. You can also insert smart fields into it using the Add Smart Field option on the right.

      • Message: It can be entered and edited using the formatting toolbar.

    1. Click Add Attachments at the bottom if you want to attach any files to the retainer email. You can also drag-and-drop any file into the Compose Email window from your desktop or email program.

    2. Click Send Message.

If the email is sent to an address that is no longer working, there is a bounce-back email sent to let you know about this.

Note: You cannot remove the default or system attachments. Only user-defined attachments can be added or removed. Core restricts the file size of the attachments to 10 MB and sends the attachments as a single zipped file.

Preview Retainers

To preview a retainer invoice or view its details:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. Select a retainer invoice on the grid that you want to view and click Preview or  to select View Details.

    2. On the Details tab, view the retainer information.

    1. Click the Preview tab to view the retainer invoice.

Download Retainers

You can download the details of the retainers as a PDF file directly from the list view.

To download a retainer invoice:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. In the list view, select the retainer on the grid whose details you want to download and click  to select Download PDF.

    2. It prompts you to save the PDF at the relevant location, say your Desktop. Click Save.

Change Online Payments

BQE Software has created partnership with AffiniPay and Stripe to offer you various payment solutions, depending on your industry and type of business. Core allows your clients to pay their invoices electronically using the ePayments method from anywhere in the world, including credit cards, debit cards, bank accounts or ACH transfers. You get to choose whether to enable ePayments at the global level for all clients or selectively enable that at the client, project and invoice level. Core lets you set up multiple online accounts to control processing fees and other settings. After the payments are completed successfully and the process status arrives from AffiniPay or Stripe, Core creates the reconciled payments and deposits in the associated bank accounts automatically. ePayments can be used for regular invoices, statements, retainer invoices as well as late fee invoices. Check out the AffiniPay ePayments or Stripe ePayments FAQs.

Retainer invoices do not have a due date and cannot be scheduled for later payments; so Core allows only the Pay Now option on them.

To change the online payment account for a retainer invoice:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. In the list view, select the retainer invoices on the grid whose payment option you want to change.
    2. Click Actions > Online Payments.
    3. On the Change Online Payment Account dialog, select the Account that you want to associate with the selected retainer invoices for the online payment. You can also remove any account by selecting None from the drop-down. (Core allows your clients to make online payments using the ePayments feature. You can check this option for the retainer invoice here and then select the Online Payment Account from the drop-down. You can also set it up at the Global Settings level for all clients and projects.

      Core allows you to select multiple online payment accounts. However, you cannot choose two payment services with the same payment method. You have the ability to access the ePayments Portal directly without having to open an invoice and click the Pay Now button. You can quickly process the payment if you have the client's credit card on hand or copy the payment portal link and email it to your client without visiting the portal.)
    4. Click Update.
    5. Alternatively, select a retainer invoice on the grid for which you want to enable ePayments and click  to select View Details.
    6. In the detail view, check the ePayments option: Allow online payments for this invoice. (Core allows your clients to make online payments using the ePayments feature. You can check this option for the retainer invoice here and then select the Online Payment Account from the drop-down. You can also set it up at the Global Settings level for all clients and projects.

      Core allows you to select multiple online payment accounts. However, you cannot choose two payment services with the same payment method. You have the ability to access the ePayments Portal directly without having to open an invoice and click the Pay Now button. You can quickly process the payment if you have the client's credit card on hand or copy the payment portal link and email it to your client without visiting the portal.)

    1. Next, select the Online Payment Account from the drop-down and click Update.

Note: If you remove the online payment profile in Global Settings > ePayments after retainer invoices are available for ePayments, the Online Payment Account gets reset to 'None' in the Invoices list.

When enabled, the ePayments option appears as a Pay Now/Pay Invoice button on the retainer invoice PDFs as well as in the body of the emails sent to the clients. They can click on the Pay button and be directed to the ePayments portal where they can enter their credit card, debit card or bank account details, and apply a partial or full payment to the retainer invoices (depending on your ePayments settings). ACH transfer can be done using manual entry of bank account details or automatic entry via Plaid. The payment history on the ePayments portal shows a list of previous partial payments received against the retainer invoice.

When the payments are made by your clients and validated by AffiniPay or Stripe, it moves the payment amount to your AffiniPay or Stripe account and deposits the same in your bank account within the next 24 hours (debiting the bank account). Core automatically creates the payment and deposit transactions with proper accounting (crediting the accounts) and reflects the processing fees (debiting the expense account). It also processes relevant notifications and delivers them to the Core user who creates the retainer invoices.

 

Show/Hide Columns in Grid

You can configure the fields or columns that appear on the grid in the list view. You can hide or show columns, and sort the order of columns according to your requirements.

To do so, watch this video or follow these steps:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. In the list view, click More > Show/Hide Columns on the action bar.
    2. Select or un-select the column names in the drop-down list, say Reference.
    3. Next, click the column name you want to sort the data by, say Requested amount.
    4. Click once for ascending order (A-Z) and twice for descending order (Z-A).

Note: You can resize the column widths on the grid and then reset them, if needed (More > Reset Column Widths).

Transfer Retainers

Typically, billing managers need the ability to transfer retainers between projects of the same or different clients, and also between projects and their clients. In case of clients, you can transfer retainers to their projects or between different clients; in case of projects, you can transfer retainers to other projects of the same client as well as different clients. These transactions involving transfer of money from one retainer account to another, affect the liability accounts at the project level. On transferring a portion of the available retainer, Core handles the process such that you are able to delete either of the retainers (original and transferred). All the related adjustment entries are automatically handled in the background and show up on retainer reports.

To transfer a retainer, watch this video or follow these steps:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. Select the relevant Client and/or Project from the respective drop-downs. You can see their retainer details on the grid, such as retainer requested, received and used.

    2. From the More menu, select Transfer Retainer.

    3. On the Transfer Retainer dialog, enter the required information:

      • Transfer To: Depending on whether you selected a client or both client and project previously, this displays the client and/or project to which you want to get the retainer transferred along with the available balance.

      • Amount: The amount of retainer that you want to transfer to another project or client.

    4. Click Transfer. The retainer amount is transferred and displays on the grid.

Refund Retainers

You can refund a client retainer from the Credit Memos screen (main menu > Billing > Credit Memos). Please see Credit Memos for further details or watch this video.

 

Mark Screen as Favorite

You can mark or flag the most-often used and important screens in Core as your favorites up to a maximum of ten. These favorite screens then display separately on the side menu under the Favorites list. You can manage all your favorite screens in Core from User Preferences.

To mark this screen as your favorite, watch this video or follow these steps:

    1. Open the Retainers screen from the side menu > Billing > Retainers.

    1. In the list view, click  on the top-right.

    2. You can access this screen from the side menu under Favorites.

Was this article helpful?
0 out of 0 found this helpful