@tomasz, what you suggest violates some basic principles of accrual accounting. Your freelancer’s invoice (entered as a purchase invoice in Manager) should be entered as soon as you receive it. The resulting account payable is a liability of your company, even if you never invoice your higher-level customer. Delaying the entry of the invoice until you invoice your customer misrepresents the position of your company.

You may also be misunderstanding work in progress. You mentioned allocating purchases to that account. But you can only allocate time.

I do not see any reason you have to fall back on journal entries, though. Your freelancer’s invoice is handled as a purchase invoice. You very much need to begin sending sales invoices to your customers. This is how you create an account receivable. You can credit the contract labor account where you recorded your freelancer’s invoice when you create your invoice.

I really think using Disbursements for what you were trying to do makes things harder, not easier.

@Tut. I think that I caused some confusion. I listed three journal entries. The first is related to the freelancer’s invoice and this entry is indeed entered upon receival of the invoice, not upon issuing my customer’s invoice. I had to be clearer. Sorry.

In the Netherlands we have an account called Onderhanden werk. This account is used to allocate costs, i.e. both billable hours and used/purchased goods, that are to be invoiced to the customer. I thought Work in progress was the English name for the account Onderhanden werk. Is there a similar account in other countries?

It’s common in other countries too. Anyway, I know what you mean and right now, Manager doesn’t have a module to handle this other than through journal entries. Disbursements is slightly different use-case from yours. So is billable time.

As I understand this, you don’t bill your clients by time. You work on fixed-price projects regardless of disbursements incurred or time spent. Is that correct?

It depends on the client and the work. But most of the time, yes, I work on fixed-price projects regardless of disbursements incurred or time spent. However, sometimes I also work on projects for which I bill the client by time.

I confused myself by thinking that Billable expenses or Disbursements were to be used to handle this :slight_smile:

Are there any plans to support this in a future release?

They are used to handle this but only if you bill your clients by time and/or disbursements. For fixed-price projects, there is no module (yet) to manage work in progress. I do have plans to add it at some point.

Thanks. That would be great :smile:

For now, I’ll use journal entries.

@tomasz, your situation points out the difference between principles of accounting and specific accounting software. Under any accounting system, you can certainly keep track of various things you will later bill to a customer. Time (converted to money by a rate), purchased items, and other expenses are examples. Onderhanden werk and work in progress can certainly be titles of accounts where you record such things. But work in progress is also used, frequently by manufacturing companies, to record the partial value of items being constructed when some parts and labor required for their completion have been applied but others remain before the item can be added to inventory. In that example, the work in progress items will never be billed explicitly to a customer. Only the finished price of an inventory good will be invoiced.

My point is that charts of accounts can be arranged to suit your organizational, market, and regulatory needs.

On the other hand, accounting software must choose a set of features to implement. Manager (so far) implements quite nicely the ability to record time spent for a customer and conveniently prepare a sales invoice later. @lubos happens to have selected Billable Time as the name for the module providing that function. He chose Work in progress as the title of the temporary account where the value of the work is stored. (You can change that title, if you wish.) Disbursements is an ongoing development, where he is developing the ability to record and pass through expenses incurred for your customer.

These feature might not meet everyone’s desires. But they are very useful for some. I am also sure creative users will figure out way to use the capabilities beyond what @lubos originally conceived. Remember, though, that no matter how creative he gets with shortcuts, searches, cloning, copying, spending, and receiving, everything comes down finally to to the equivalent of journal entries. So you can make Manager do whatever you like, as long as you follow the underlying principles of double-entry accounting. (I’ll be honest: sometimes, I have used tabs and features that turned out not to save me time. So I’ve gone back and undone the entries and converted them to simpler forms. One of the things I like best about Manager is that you can strip it down to your most frequent use cases.)

I didn’t mean that I want to see it on my P&L. I am trying to tell, that when I look at my summary, I only see disbursements recoverable and disbursements income as separate tabs. Were can I see the disbursements recoverable minus the disbursements recoverable.

I mean the disbursements income minus the disbursements recoverable.

@ummu, Disbursements recoverable is an asset account. Disbursements income is an income (or revenue as some prefer) account. Thus, Disbursements recoverable appears on the balance sheet and is one element in reporting the current position of the company. Disbursements income appears on the income statement (also called Profit and Loss Statement, as Manager does) and contributes to reporting performance during some period. It is not a standard accounting practice to mix accounts from the balance and income statements.

In Manager, the connection between the two accounts runs through Accounts receivable (after invoicing the customer) and a cash or bank account (when payment is received).

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We are getting money from our customer we call it a third party account is legal terms, but we can see this as billable expenses income.

What we need is that we use these money to make expenses for our customer, we pay the court fees, we pay the notary, we pay several government institutions, all expenses are made for our customer, the bills are on their name.
So when using manager, I think we have to record this as disbursements income for the received money, and as disbursements expenses (purchase invoices) for the expenses made.

If the customers ask me, what is the sum (the money) you have (dr income - dr expense), I have to answer him, or I have to send him an overview. Do I do something wrong? I can’t find any overview or any report.

@amsterdam, I recommend wait a week or so until this module gets done. Guides will be updated. It’s just that workflow is likely to change a bit (the invoicing part) so are names of control accounts still subject to change.

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Are the guides updated yet? What about the disbursements tab, are you still working on it?

@lubos is there any progress in the disbursements tab? and the guides about the disbursements

Not yet, I will be coming back to work on disbursements sometime next week. Then guides will be updated.

@lubos is there any update on the disbursements tab?

Yes, see http://www.manager.io/guides/disbursements

If something is not clear, let me know. I keep improving guides continuously.