Task guide
Mixed receipts and overpayments
Split one payment between a bill and money on account, move the share in the wrong account across by its due day, and keep overpayments as client money.
A client often pays one sum that covers a bill and money on account. The bill's share is the firm's money; the rest is the client's. The two are never mixed: a receipt is split into parts, and each part goes where it belongs.
Splitting a receipt
- Record the receipt as usual, then choose Split into parts.
- Add office parts for the bills the payment settles, or office money held until it is applied.
- Add client parts for each matter the client money is for. A part can answer a funds request on its matter.
- The parts must add up to what was received.
A part for a matter of a different client is a payment by a third party. Say how the payer stands to the client and why they pay. The compliance function is told of every such payment.
A cheque's parts can be changed while it is held. Once the money has posted, a change is a reversal and a new receipt.
Which account it lands in
The money reaches one account. The firm's setting under Settings, Ledger says where a mixed payment goes when no account is named: by default the client account, with the office's share taken out promptly.
- Into the client account: the client parts reach their matters' ledgers at once. The office's share waits in the client account as office money until it is transferred out.
- Into the office account: the bills are paid at once. The client's share waits in the office account until it is transferred into the client account; only then does it reach the matters' ledgers.
Transfers due
The share in the wrong account is a transfer due by the same day or the next working day, as the firm sets. Client account, Transfers due lists them with their age.
- Due to office: choose Ask for the transfer. It is a transfer to office like any other, approved by somebody else and signed as the account's mandate asks. An office share paid by cheque stays in the client account until the cheque clears.
- Due to the client account: choose Record the transfer, with the day and the bank's reference.
A transfer still due the morning after its day is told to finance and the client account partner.
Overpayments
Money paid beyond what a bill asks is not yet the firm's. By default the excess becomes client money on the bill's matter, where it can be refunded, held on account or applied to the next bill by a transfer to office. A firm that turns the setting off keeps the excess as office money on the payer's account.
Reversing a mixed receipt
Reversing it takes back every part: the bills are unpaid again and the client money leaves the ledgers. A transfer not yet made is no longer due. If the transfer had already been made, the other account is now short; that sum becomes a transfer due back, and the matter's partner and the client account partner are told.
The receipt
The receipt the payer receives shows what paid their bills and what is held for them in the client account under separate headings.
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Read next
- The client account and its ledgersWhat the firm holds for each matter in each currency, the statement a client reads, the funds held with the control figures, dormant money, quarantine and refused overdraws.
- Move client moneyTransfer client money to office against a bill, refund it by payment voucher, pay a disbursement from it, or move it to another of the client's matters, each asked for, approved by somebody else and carried out.
- Asking for funds on accountAsk a client to pay money on account into the client account, send the request as a letter or by email with a pay link, see what has come in, and keep a retainer topped up.
- Earmarking client moneySet client money aside on a matter for a stated purpose, such as stamp duty, use it in the payment it is for, or release it with the reason.