- Created by Suchi Govindarajan, last modified by MartinW on Oct 29, 2018
https://help.myob.com/wiki/x/1ieEAQ
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The Billing Wizard guides you through all five stages of creating a bill. Information related to each step of the process is outlined below.
Stage One: Create a draft bill
Stage one creates the draft bill. Consider the following points when entering information in this stage.
The Tax Type defaults to Taxable Supplies. If you are dealing with an overseas client, select the relevant tax type from the drop-down.
Style allows you to select the template to be used for the bill.
Invoice Number — leave the field blank to automatically allocate the next invoice number when the bill is posted.
Invoice Date defaults to today’s date. You can change this here, or before you post the bill.
Stage Two: Add bill amounts
Stage two is used to allocate WIP to a bill. Consider the following when entering information at this stage.
The toolbar located at the top left of the window provides easy access to frequently used functions.
Drag column headings to the area identified by Drag a column header here to group by that column to drill down to the required level ready to allocate WIP.
It is suggested that you group by Job, then Code Type (which is time and disbursements split) and then Code (which is all your task codes). This makes it easier to bill at a higher level than individual transactions if not required.
Description of options |
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Navigate up Click to move back up through the WIP display levels after you have drilled down through the WIP items. The drill up and down path is determined by the order of the grouping you have set. You can also drill up and down by selecting the option from the right-click menu. |
Create estimate Access online learning video on this topic Accesses the Create new estimate to complete window where you can add a new estimate to the bill (sometimes previously referred to as Interim bills). See MYOB AO > Billing > WIP and Debtors > Using estimates in billing in the Online Help for detailed information. |
Create miscellaneous charge Access online learning video on this topic Accesses the Create new billing charge window where you can add a new miscellaneous charge or credit note to the bill. A miscellaneous charge bill will update Debtors Only and does not affect WIP. See MYOB AO > Billing > WIP and Debtors > Using miscellaneous charges in billing in the Online Help for detailed information. |
Add Job... Used to add another job to the bill. |
Add Jobs to client Used to add another client’s job to the bill. |
If you only want to display WIP items up to a certain date, click the and use the drop-down calendar to select the required date. All WIP entries after the selected date will be removed from the list. |
When the checkbox is ticked, billed amounts are allocated using a Pro-rata basis instead of the default First In First Out basis, or commonly known as FIFO. This selection is remembered for the next practice bill you process. |
MYOB AO works on a First In First Out (FIFO) basis when allocating the billed amount against jobs.
Alternatively, you can allocate bill amounts using a Pro-rata basis.
Both these methods are bypassed if billing at transaction level.
This method is ideal if you are clearing the WIP balance totally.
The pro-rata method allocates amounts against WIP entries, based on the percentage of the total WIP balance that the invoice amount represents.
This is illustrated in the table below where the invoice amount is $1,000 and the total WIP is $1,500. Each WIP entry balance is reduced by two-thirds leaving one-third as the WIP entry balance.
The pro-rata method spreads a write-off across all employees who worked on the job.
Date | Employee | Amount | Allocation | WIP Entry Balance |
|---|---|---|---|---|
30-01-12 | Tom | 100.00 | 66.67 | 33.33 |
02-02-12 | Dick | 200.00 | 133.33 | 66.67 |
03-02-12 | Harry | 300.00 | 200.00 | 100.00 |
04-02-12 | Tom | 400.00 | 266.67 | 133.33 |
05-02-12 | Dick | 500.00 | 333.33 | 166.67 |
05-02-12 | INVOICE 122 | -1,000.00 |
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Bill | 1,000.00 |
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Write off | 0.00 |
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Total WIP | 1,500.00 |
| ||
Proportion | .67 |
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Closing WIP | 500.00 | |||
Advantages
The major advantage of using the pro-rata method is in measuring employee recoverability. If at the end of an job, 10% is written off, all employees will proportionately have 10% written off against their WIP contribution. Whereas, if the practice was billing at the job level and using the FIFO method, the employees who worked on the job last would have the write off allocated against their entries.
Disadvantages
A disadvantage of using the pro-rata method is where the practice is partially billing a client on a regular basis. The table above illustrates this where two additional WIP entries have been input and a new invoice is raised for $1,125. As the WIP is being carried forward at the time of billing, the pro-rata allocation reduces each WIP entry balance by 75% (that is, $1125/$1500). This results in the previous partially billed WIP entries having a balance and still needing to either be billed or written off (on) in a future period. This will also mean that your Aged WIP report can be left with small amounts left over different aging.
This method is preferred if you are carrying forward WIP transactions.
The FIFO (first in first out) method allocates amounts against the WIP entries incurred first, with the earliest entry at the head of the queue. This is illustrated in the table below where the invoice amount of $1,000 is allocated against the oldest entries until all of the $1,000 is allocated, with the remaining WIP entries being carried forward.
Date | Employee | Amount | Allocation | WIP Entry Balance |
|---|---|---|---|---|
30-01-12 | Tom | 100.00 | 100.00 | 0.00 |
02-02-12 | Dick | 200.00 | 200.00 | 0.00 |
03-02-12 | Harry | 300.00 | 300.00 | 0.00 |
04-02-12 | Tom | 400.00 | 400.00 | 0.00 |
05-02-12 | Dick | 500.00 | 0.00 | 500.00 |
05-02-12 | INVOICE 122 | -1,000.00 |
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Bill | 1,000.00 |
| ||
Write off | 0.00 |
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Closing WIP | 500.00 | |||
Advantages
The major advantage of this method is that it is very clean and simple to manage your WIP. It will not lead to the situation outlined with the pro-rata method whereby the practice needs to clean out WIP entries with small values.
Disadvantages
The disadvantage of the FIFO method is that if the practice determines the invoice amount at the job level rather than the employee level, employee recoverability can be impacted. If employee recoverability is important, we would recommend billing at the employee level in which case the FIFO method will manage the WIP entries cleanly and simply while maintaining your reporting requirements.
If writing off the system will allocate the bill amount in FIFO method but the latest transactions will be used for the write off.
Enter bill amounts in the yellow Bill column against the WIP item you want to allocate for billing.
Click in the field and type the amount or double-click the field to automatically enter the entire WIP amount.
If you do not include the entire WIP amount in the bill, the remaining unallocated WIP will be carried forward to be allocated to the next bill.
Enter write up or write off amounts in the Write-Off (On) field against the required WIP item.
Write-offs are entered as positive amounts and write-ons are entered as negative amounts. MYOB AO displays negative amounts (write-ons) in parentheses. For example, -100 will be formatted to appear as (100.00). Write-off amounts are displayed in red.
MYOB AO will automatically calculate the write-off or write-on amount based on the difference between the WIP amount and the bill amount.
If the amount typed in the Bill field is greater than the Posted WIP, the write-on amount is calculated and displayed automatically.
If the bill amount is less than the Posted WIP balance on the job and you want to write-off all of the remaining WIP, double-click in the Write-Off (On) field. Alternatively, enter an amount in the Write-Off (On) field to write-off some of the remaining WIP and carry the rest forward.
If you want to report on Write-Off (On) reasons, right-click and select Billing Explanation... to open a window and enter the required information.
If you over bill the WIP amount and do not take a write up, a yellow triangle warning icon is displayed against the item in the A column.
Adjust the amounts entered to either bill less or take a write-up.Common error messages
Common error messages
You may encounter one of the following messages:
Bill included transactions dated after invoice date
This means that the invoice date is earlier than the transactions that you are billing. You can click Yes to continue, however, it is best practice not to include transactions from the next month in a bill dated in the current month, for example a timesheet dated in December in a bill dated November. This may mean you to have reconciliation issues with month end reports. In this example, it is best to change the invoice date to be December.
Bill includes transactions already in another draft bill
This means that the transactions you are billing have already been included in another draft (unposted) bill. Click Yes if you are sure that you are not overbilling or double billing a WIP entry. Click No if you want to go back and change your bill amounts.
Stage Three: Creating billing paragraphs
Stage three is where you can customise the text that appears in the bill.
To see the text for a paragraph, click the paragraph in the table at the top of the window. The text is displayed in the box under the list of paragraphs. You can select and edit the text in this box.
Consider the following when creating bill paragraphs:
Defining the level of detail included in the text
Select the amount of detail from the Print Line Detail drop-downs. The bill paragraphs are regenerated each time you change the level of detail.
Choose from the following options for each transactions type:
| Option | Description |
|---|---|
| Summary | Shows one billing paragraph with the total amount being billed for each code type for example total time, total disbursement, total estimate, total miscellaneous charge. |
| Detailed | Creates a billing paragraph for each transaction being billed. |
| Group by Code | Creates a billing paragraph for each task code being billed. For example, you may have one paragraph for meetings and another for tax preparation. |
| Group by Employee | Creates a billing paragraph for each employee against whom you are billing the client. |
| Group by Job Type | Creates a billing paragraph for each job type being billed. For example, you may have one paragraph for compliance work and another for consultancy services. |
Item | Description |
|---|---|
Text toolbar | The text toolbar at the top of the screen lets you format the text. |
This Client | Used for copying paragraphs from old bills for this client. |
Other Client | Used for copying paragraphs from old bills for another client. |
Move Up | Used to move the selected paragraph towards the top of the list of paragraphs. |
Move Down | Used to move the selected paragraph towards the bottom of the list of paragraphs. |
Paragraphs | Used to open the Master Paragraphs window that allows you to select and add master paragraphs to the bill. On the Master Paragraph window, select Table view to change the list of Paragraph Types to a searchable list of Paragraph names and text that make it easier to find what you are looking for. |
Regenerate | Regenerates the bill using the default paragraphs. Any editing, formatting or paragraphs you have added will be lost. |
Add | Adds a new empty paragraph for you to type text into after the selected paragraph. |
Delete | Deletes the selected paragraph from the bill. |
The following shortcut keys can be used to quickly add and update paragraph text.
Action | Shortcut Key |
|---|---|
Append / add the paragraph text to the existing text. | [Shift] Highlight the new paragraph and drag it to the paragraph Text field you want it to appear in. |
Insert multiple paragraphs. | [Ctrl] Hold down the Ctrl key and highlight the paragraphs to be inserted. Clicking the [Insert] button will add the highlighted paragraphs. |
Stage Four: Set billing address
MYOB AO selects the Postal address as a default for bills.
Stage four is where you can select a different address, if required.
You can also include a relationship in the billing address by clicking the checkbox beside the relationship if one is displayed.
Stage Five: Confirm and post the bill
This is the final stage of the Billing Wizard.
For now click Finish to come back to the Main billing page. As you become more experienced you can post the bill from this page if you prefer.
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