Wednesday Wisdom: Invoicing and the Matter Ledger – Payments v. Adjustments
Adjustments have time and time again made their way into the matter ledger appearing as a payment, causing unrest in Billing. In the matter of Payments v. Adjustments, we are here today to try the case regarding identity theft charges against the defendant.
Adjustments are a wonderful tool in Rocket Matter. Need to issue a credit or refund? Maybe applying a late fee? These are perfect jobs for adjustments. However, adjustments are not payments, even though they may appear as such. When receiving any type of payment, it can become confusing as to how to record a payment correctly. Let’s go over the differences between the two and how to record them to properly appear on your reports.
So the client has paid!
You’ve done the hours and hours of work, tracking every step along the way. You ran the invoice and sent it to the client. Great news! You’ve received the payment. Now what?
1. Navigate to the matter and click on ‘Add Payment.’
2. Select the option to ‘Pay Invoice(s).’
3. Enter in the full amount of the payment, date of payment, and description.
4. If paying towards a specific invoice, you may choose which to apply the payment towards by checking or unchecking the appropriate invoices. Also, you may split the payment amounts to multiple invoices however you see fit.
5. Click ‘Record Payment.’
Head to the matter ledger. Here, you’ll see the payments recorded, as well as all previous invoices ran. Simple as that!
Well, now how do I apply a discount? Refunds? Late fee?!
Adjustments can be used for many different items. However, be aware when adding adjustments. Adding credit adjustments may appear on the matter ledger balance as if the client has paid, but they are not payments and will not appear as such when running reports.
Have a client that is late on paying an invoice and want to add a late fee of $100? Maybe bring over a balance from another application? Simply add a debit adjustment to the matter ledger. Similarly, if you want to give your client a discount, simply add a credit adjustment to the matter ledger. Here’s how you can apply adjustments to the matter ledger:
1. Navigate to the matter and click on the matter ledger balance.
2. Click on the green ‘Add an Adjustment’ button underneath the matter and pending invoicing balances.
3. Choose debit or credit from the drop down option, enter the amount of the adjustment with a description, and click Add.
Adjustments are created to show changes made to the ledger as it stands, not to record work done or payments received. Now that we have defended adjustments with the appropriate evidence, it’s time for you to execute the right job for both the plaintiff and the defendant.
If you would like to see which invoices all your payments are going towards, feel free to check out our newest report, Payments to Invoices. You can find this report through the Admin section under Reports.
For additional resources, please feel free to visit our FAQ page.
Want some live, interactive U.S.-based training? For all your payment and billing questions, join our free Firm Billing webinar. You may register for this class, along with some other topics, here.