Help: Accounts Receivable (AR)

The "Quote-to-Cash" Workflow

Accounts Receivable (AR) is the process of managing the money your customers owe you. It covers the entire lifecycle from sending an initial price quote to receiving the final payment. We call this the **"Quote-to-Cash"** lifecycle. Understanding this flow is key to managing your cash flow and sales pipeline.

Step 1: Managing Clients

Everything in AR starts with a client. You cannot send an invoice without first having a client record.

Creating a New Client

1. Navigate to Clients in the main menu.
2. Click the Add Client button.
3. Fill in the key details. The most important fields are:
   • Client Name: The official name of the company or person.
   • Client Type: Helps you categorize your relationships (e.g., Customer, Partner, Prospect).
   • Primary Contact: Add at least one contact with an email address. This is where invoices and estimates will be sent. You can add multiple contacts for different purposes (e.g., Billing, Technical).
4. Click Save Client.

Step 2: The Sales Process (Estimates & Sales Orders)

Estimates (Quotes)

An Estimate (or Quote) is your way of telling a customer how much a job will cost. It does not affect your accounting records and is non-binding.

How to Create an Estimate:

1. Navigate to Estimates.
2. Click Create New Estimate.
3. Select the Client. The contact and address details will auto-fill.
4. Add line items for each product or service, including description, quantity, and price.
5. Set the Status:
   • Draft: You are still working on it.
   • Sent: You have emailed it to the client. This is now part of your "Sales Pipeline".
6. Save and email it to your client.

Once the client responds, you update the Estimate status to Accepted or Declined. An "Accepted" estimate is ready to become a real order.

Sales Orders

A Sales Order is a confirmation that a customer has committed to a purchase. It is the bridge between an accepted quote and the final invoice. Creating a Sales Order allocates inventory (if applicable) and puts the work into your official queue.

How to Create a Sales Order:

• From an Estimate: The best way! Go to your Accepted Estimate and click the Convert to Sales Order button. The system will automatically create the Sales Order with all the same details.
• From Scratch: Go to Sales Orders and click Create New Sales Order.

Once the Sales Order is created and confirmed, it's ready for the next step: fulfillment.

Step 3 & 4: Fulfillment & Invoicing

Fulfillment Queue

The Fulfillment Queue is your command center for shipping. It shows all confirmed Sales Orders that have items waiting to be shipped.

How to Use the Fulfillment Queue:

1. Go to the Fulfillment Queue module.
2. You will see a list of all Sales Orders with shippable items.
3. From here, you can generate pick lists, packing slips, and mark orders as "Shipped".
4. Once an order is marked as Shipped, it's ready to be invoiced.

Invoices

An Invoice is the official bill you send to a customer to request payment. It is a legal document that posts to your General Ledger, increasing your Accounts Receivable.

How to Create an Invoice:

• From a Sales Order: After items are shipped, go to the Sales Order and click Create Invoice. This is the most accurate method as it bills for what was actually sent.
• From an Estimate: You can also convert an Estimate directly to an Invoice if you don't use Sales Orders.
• From Scratch: Go to Invoices and click Create New Invoice for simple, on-the-spot billing.

Step 5: Getting Paid

Recording Payments

Once a customer pays you, you must record the payment against the invoice to mark it as "Paid" and reduce your Accounts Receivable balance.

1. Find and open the paid Invoice.
2. Click the Receive Payment button.
3. Enter the date, amount, and payment method (e.g., Check, Bank Transfer).
4. Select the "Deposit To" account. This is typically an "Undeposited Funds" account or your main Checking account.
5. Save the payment. The invoice balance will be updated.

Recurring Invoices (Automation)

For subscriptions or retainers, you can have the system generate invoices automatically.

1. Go to Recurring Invoices and create a new schedule.
2. Define the client, the frequency (e.g., "Monthly"), the start date, and the items to be billed.
3. Set the status to Active.
4. The system will now automatically generate a new invoice each month on the "Next Run Date".

AR Reporting: Who Owes You Money?

The most critical AR report is the **AR Aging Summary**, found in the Reports module.