Retainers

Two kinds#

A retainer is money or a fee agreed ahead of the work. EscBooks has two kinds:

• Prepaid balance: the client pays a deposit up front, and your invoices are paid from it until it runs low. Then you ask for a top-up.
• Monthly fee: a set fee each month that includes a number of hours. Hours over that are billed the month after, at an extra-hours rate.

Either kind can cover all of a client's work or one project's (a law firm's retainer for one matter, say). A client can have one active retainer of each kind for all their work, and one of each kind per project. Start one with New Retainer on Retainers, or in the Retainers card on the client's page.

Retainers is a feature you can turn off, and back on, in Terms and features. The words client, project and retainer can be changed there too (a firm might say Deposit); invoices and other things your client receives keep the standard words.

Starting a prepaid retainer#

Retainers

Retainers

Money clients pay up front, and monthly arrangements with hours included.

New Retainer

Held in Retainers

$0.00

Unearned until applied to invoices

Monthly Retainers

$3,000.00

In fees each month

Bills to Review

0

Made on each bill date

Hollis & Reed

All work

Monthly

$3,000.00a month · 20 h included

12.5 of 20 h usedBills Nov 1

Step 1 of 6PauseStart over

1. 1On Retainers, click New Retainer. Prepaid balance is the kind for a deposit your invoices are paid from.
2. 2Pick the client, and whether it pays all of their work or one project's.
3. 3Type the Deposit to request, and the balance you want a warning under.
4. 4Leave Pay invoices from the balance on, and click Start and Request Deposit.
5. 5It's a draft invoice for the deposit, with no tax. Send it as you'd send any invoice.
6. 6When the client pays, Record Payment on it. The money goes into the retainer's balance.

1. On Retainers, click New Retainer and leave Kind on Prepaid balance.
2. Pick the Client, and under For, all of their work or one project. A project retainer only pays that project's work.
3. Type the Deposit to request, or leave it blank to add deposits later. Set Warn when the balance is under to the point you'd want to ask for more.
4. Leave Pay invoices from the balance on to have each invoice paid from it as you send it. Off, you apply it to invoices by hand.
5. Click Start and Request Deposit (or Start Retainer, with no deposit). EscBooks opens the draft deposit request: an invoice with one line, Retainer deposit, and no tax, since a deposit isn't a sale. Review it and send it.
6. When the client pays, record the payment on that invoice as you would any other. The money goes into the retainer's balance.

Money that arrived without a request (a check with the signed engagement letter) goes in with Record Deposit on the retainer's page: the Amount, the Date received, the account it was Deposited to, and a Note.

Retainers hold US dollars, so they pay dollar invoices only, and a client with a retainer is billed in dollars.

How invoices are paid from it#

Invoices/Draft

Draft

DraftLarkspur Dental · $1,800.00

Delete DraftPreviewMark as SentSend Invoice

ItemDescriptionQtyRateAmount

DesignPatient portal mockups8$150.00$1,200.00

DesignBooking page revisions4$150.00$600.00

Total$1,800.00

Step 1 of 4PauseStart over

1. 1Bill the client as usual. Sending the invoice (or Mark as Sent) pays it from the balance.
2. 2The client sees it paid from the retainer, and what's left in it.
3. 3On the retainer's page, the payment is in its ledger, and the balance is lower.
4. 4Under the warning line, it's marked low and the bell reminds you. Request Top-up asks for more.

Bill the client as usual. With Pay invoices from the balance on, sending an invoice (with Send Invoice or Mark as Sent) pays it from the retainer straight away. The payment is listed on the invoice as From retainer, and as Paid invoice in the retainer's ledger. Try it:

• A retainer pays the smaller of what the invoice owes and what it holds. The balance never goes below zero; whatever it can't cover is still owed on the invoice.
• A project retainer pays only that project's lines, with their share of any tax and discount. A client with both pays from the project retainer first, then from the one for all their work.
• The retainer pays as the invoice is sent, not later. An invoice sent before a deposit or top-up arrived, or while the switch was off, shows Pay from Retainer: pick the retainer (if there's more than one), check the Amount, and click Pay … from Retainer.
• Removed a From retainer payment from an invoice? The money goes back into the retainer, and the invoice owes it again.

The balance, low warnings and top-ups#

• The retainer's page shows the Balance and every Deposit, Paid invoice, Refund and Adjustment, each with the balance after it. Requested lists deposits you've asked for that aren't paid yet.
• At or under its warning amount, it's marked Low (and Balance low on its page), and the notification bell says it's running low, or empty. Your dashboard mentions it too.
• Request Top-up makes the next deposit request, a draft retainer invoice with the line Retainer top-up. Its payment goes into the balance like the first.
• Held in Retainers, on Retainers, totals what every prepaid retainer holds.

Refunds, corrections and ending#

These are in the ⋯ menu (More actions) on the retainer's page:

• Refund to Client: money you've returned. It starts at the whole balance; say which account it was Paid back from.
• Adjust Balance: a correction. Use a minus sign to lower it.
• Edit Retainer: the warning amount, the switch and the notes (and, for a monthly fee, its terms). Its client, project and kind can't change: end it and start a new one.
• End Retainer: it stops paying invoices, and its history stays. If money is still in it, refund that first when it goes back to the client.
• Delete Retainer is there only while nothing has gone in or out of it.

What your client sees#

• A deposit request is an invoice like any other, with the one Retainer deposit (or Retainer top-up) line and no tax.
• An invoice paid from the retainer shows Paid from retainer in its totals, and a note: Retainer balance: what's left after this invoice.
• The client's Statement (on the client's page) lists the balance in each of their prepaid retainers.

Monthly retainers#

Choose Monthly fee in New Retainer and set the Monthly fee, the Hours included each month, and Extra hours at (blank uses the client's usual rate). First bill is the first bill date; it repeats on that day of each month, so pick a day from 1 to 28. Last month billed is optional.

• The fee bills ahead and extra hours after: the November 1 bill has November's fee and October's extra hours. The first bill is just the month's fee.
• The hours that count are the client's billable hourly or day-rate time that isn't on an invoice yet. Fixed-fee projects and flat days bill on their own. A project retainer counts only that project's hours, and a retainer for all of a client's work leaves out a project with its own monthly retainer.
• That time waits for the bill instead of showing on To Invoice, where a line says when it's billed. Once billed, the month's time belongs to that bill, as it would to any invoice.
• With Roll over unused hours on, a month's unused included hours carry into the next month only. Off, they expire.
• Each bill is made as a draft on its bill date, never sent on its own. Bills to Review on Retainers, the bell and the dashboard say when one is ready. Once a bill date has come, the retainer's page also has Make … Bill.
• Delete a draft bill (or void it, if it was numbered) and that month can be billed again.
• With Last month billed set, the retainer bills its last fee then, settles that month's hours on the next bill date, and ends. End Retainer stops it any time: no more bills, and the ones made stay.

How it counts in your books#

A deposit isn't income when it arrives. Until it's earned, it's money you hold for the client: in accounting terms, a liability (also called unearned revenue, or a customer deposit). In the General Ledger, in Reports → Advanced, it's the account Client retainers held.

• A deposit moves money into your bank account (or Undeposited funds) and into Client retainers held. Your income doesn't change.
• When the retainer pays an invoice, that amount moves out of Client retainers held. On cash basis, that's when it counts as income, on Income and in your reports. On accrual basis the invoice counted as income when it was sent, and the retainer pays off its Accounts receivable.
• A refund takes money out of the bank and out of Client retainers held, never touching income.
• An adjustment is recorded against Opening balances and adjustments.
• Deposit requests aren't counted as invoiced, on Invoices and in Reports: the work they pay for is invoiced on its own.
• A monthly retainer's bills are ordinary invoices: income when they're paid.