Prepayments are used to provide contractors with upfront funds to purchase materials and other necessary items. Prepayments to suppliers are used when the supplier requires an upfront payment to secure an order.
For customer prepayments, such as deposits, see Managing Prepayments.
Prerequisites
Users need the Jobs > Manage Bills on Stage permission to view the Bills tab in Manage Job.
Users need the Finance > Manage Approved Bills permission to create, edit, and approve bills.
Contractor and supplier prepayments are funds provided before the related job is completed. The cost is recorded directly as an expense in your financial software.
A prepayment RCTI can be sent to the contractor in the same manner as a standard RCTI. Prepayments for contractors and suppliers use the Prepayment - Supplier document themes.
Creating a prepayment bill
To create a prepayment bill for a contractor, the contractor must be assigned to the stage; otherwise, only supplier prepayments can be created.
Open the job the prepayment is for
Select the stage where the prepayment will be added
Select the Bills tab
Select the down arrow next to the plus
Select Prepayment
Select the contractor or supplier in the Account drop-down
Enter the unit price in the invoice line
Optionally adjust the quantity
Select Save to create the bill.
Prepayment bills do not affect the job's Financial Recap, as only the total cost is shown.
Prepayment bills are identified by a PP symbol in the bills list.
Paying the prepayment to the contractor/supplier
The bill payment must be recorded in WorkBuddy. See Managing Payment Methods. The payment for contractor prepayments is always recorded as a single transaction.
To pay the prepayment bill
Select Make Payment in the prepayment bill. A New Payment pop-up will appear.
Select the payment method.
Select Make Payment to record the payment.
Once the prepayment is paid, it will sync to Xero as a bill. The bill will have a paid amount equal to the prepayment, but will be in Awaiting Payment status.
Crediting the prepayment to a bill
The prepayment can be credited to the invoice in Xero or in WorkBuddy.
Before you credit the invoice in WorkBuddy, the bill must be Approved in your finance software, or the credit will not sync. In that case, you'll need to manually apply the credit in your finance software to ensure the outstanding amounts match in both systems.
After a bill is approved, there will be a note above the finance software link indicating that the contractor/supplier has a credit.
The outstanding credit includes prepayments for this job and any credit notes for this contractor.
To apply the prepayment to the bill
Select "Credit this bill"
Enter the amount to credit; this is usually the full prepayment amount
Select Allocate Credit
The Outstanding balance of the bill will be reduced. As long as the bill is Approved in your financial software, the payment will sync, and the amount due on the bill will be reduced in both systems.
Result
You now know how to create prepayments and apply them to contractor and supplier bills.