Lubos, do you still have plans to implement billable expenses? If so, do you have a target date? Thanks.
Yes, currently working on it. In fact, the latest version contains Disbursements tab and ability to post billable expenses to Disbursements recoverable asset account. It took me quite a while because it turns out there are many edge-cases I needed to nail:
- Writing-off disbursements
- Automatic detection of markups on disbursements and properly accounting for it
- Automatic recognition of unrecoverable disbursements
- Spending money in one currency and recovering them in different currency
- Applying credit note (or receiving refund) from supplier and ability to apply it against specific billable expense if applicable
and many other concepts I needed to wrap my head around.
At the same time I wanted to make the whole workflow logical, simple and solid.
Thanks for the status update, Lubos. I’m not completely clear where things stand, though. I enabled Disbursements and can spend money while debiting Disbursements recoverable for a selected customer. But there is no option to initiate a sales invoice from the resulting account list as there is with Billable time. Nor can one create a disbursement directly. So the only value I see is that one can temporarily park billable expenses in an asset account instead of an expense account. Is the ability to quickly transfer such expenses to a sales invoice coming? Is my confusion only caused by this capability still being in development?
Thanks again for your continual improvements to the product.
I came to the same conclusion - Work in Progress. Looks like it will be great when done. Thanks Lubos!. Did notice one issue with it thus far. Charges to Disbursements recoverable done as ‘spend money’ from cash/bank work fine and show up on the disbursements list, but if you charge a Purchase Invoice line to disbursements (even with a customer specified) the amount shows up in suspense for some reason?
@Tut, the workflow is not complete. I did release incomplete implementation since I spent a few days thinking about it and working on it non-stop and I was afraid if I drag it one more day without releasing at least something, my motivation will drop. The important thing is that now I’m purely down to writing code rather than trying to figure it out so the remaining pieces will follow in upcoming hours.
@alasdair, that will be fixed if it’s happening. Purchase invoices will fully support disbursements too.
I can confirm @alasdair’s report that transactions entered via a purchase invoice end up in Suspense rather than Disbursements recoverable, which remains empty.
I also am curious about the change of terminology. What happened to Billable expenses, which is how this module has always been mentioned? Is the Disbursements capability going to be used in some larger scheme? From the first time I read about Billable expenses, I envisioned only the ability to pass ancillary costs through to a customer. I can understand the needs you mentioned to allow for possible markups, write-offs, currency differences, etc., but unless you have bigger plans, use of the left navigation title Disbursements and the account name Disbursements recoverable seems less straightforward and understandable than Billable expenses.
Let’s discuss terminology one month from now after the module is complete and actually used in wild.
Great. I’m having fun playing with this. It will be perfect for our SSA dues. We get billed by the soaring Society of America annual dues for every member then rebill to our members. Perfect.
One additional observation - When you use the disbursements account (even from spend) if you do not specify a customer the amount for the lines without a customer currently hits Suspense, only those with customer specified actually show up under Disbursements recoverable. It may take me a little time to finalize who gets every line. Would prefer if (I) the unallocated under disbursements hit showed up as a balance in the Disbursements account but as ‘Unassigned’ lines (rather than unbilled)? Thoughts?
Like @alasdair, I am also enjoying the opportunity to explore the new capability. I look forward to seeing how the overall workflow develops.
Unlike @alasdair, I would recommend keeping things simpler so they are usable by less-sophisticated users and encourage proper accounting practices. My view is that if you don’t know to whom an expense will be billable, you shouldn’t enter it that way, because you are misrepresenting the company’s financial position. Until a customer willing to reimburse the expense can be identified, that expense isn’t yet recoverable and is properly assignable to the company. Should a customer later come forward, you can always transfer the expense via a journal entry.
Consider a simple example. A client engages my company for consulting services at their headquarters in another city. I know when I book flight and hotel reservations they will reimburse them. Previously, I would debit travel expense and credit cash (actually a credit card bank account) when I pay. When submitting my sales invoice, I would include the reimbursable expenses, thereby transferring them to accounts receivable, reducing the travel expense account so it only shows the amount spent directly for the benefit of the company rather for a client. But if the terms of my contract did not include travel reimbursement, I would simply leave those expenses in the travel expense account. Conceptually, in the second situation, they are not expenses incurred on behalf of a customer but necessary costs of doing business. While the distinction may be academic in most cases, there are some taxation situations where various expenses become non- or only partially deductible, depending on whether they are reimbursed.
With the new capability, since I know the expenses will be reimbursed, I can categorize them accordingly from the start. They show as a recoverable asset and are cleared by the customer’s payment. The travel expense account is never disturbed. That makes for fewer accounting entries and a cleaner audit trail, even though the end result is the same.
If I don’t know a customer at the time the expense is recorded and allow it to go to an undesignated recoverable account instead of Suspense, I will have to edit the transaction after the fact to identify the customer (generally a bad idea in accounting) or make a journal entry to move it, and then proceed with invoicing and all the subsequent steps. In other words, what might have seemed like a convenience actually generates more work.