The Progress Billing feature can be used to handle retainers. This method allows you to bill the client for a retainer. Progress billing works particularly well in situations where the client's fees will not be billed until the matter is settled.

Note: Progress Fee retainers can only be applied to fees—they cannot be applied to expenses or advances. If the client's retainer is used for expenses or advances, you cannot use this method for handling retainers.

The Progress Billing feature has several advantages over simply entering a payment for a retainer received. First, the Progress Billing feature can be used to bill the client for the retainer. To bill a client for a retainer, select the Progress Billing check box on the Billing Preferences tab of the Client matter. Then, enter a Type 6 (progress fee) transaction for the client for the amount of the retainer. Select a statement template for the client that uses a Fee Format of Info Only. The statement will reflect the retainer transaction as well as any other fees that may have been entered; however, only the Type 6 transaction will be billed. When this statement is updated, the accounts receivable balance for the client will reflect the retainer amount due.

When the client pays the retainer, the accounts receivable balance is reduced to zero. This feature offers another advantage over simply entering payments for retainers received. When entering payments for retainers received, a negative accounts receivable balance for the client may result which may or may not be a desirable situation. By using the progress billing feature to handle retainers, you may be able to prevent a client from having a negative accounts receivable balance.

Before fees can be billed, the client's Progress Billing check box must be cleared and a statement template must be selected that has a Fee Format of Standard or Summary. When the next statement for the client is run, the progress fee retainer balance will be reconciled on that statement.

See also:   Progress Billing