QuickBooks Helps You Make a Statement

How do you let customers know they owe you money? Probably by sending invoices. And how's that working for you? If your customers are all conscientious and pay on time, maybe that's all you need to do.

But perhaps you need to consider doing at least part of your billing by dispatching statements. These forms have their drawbacks. For example, you can't include sales tax or discounts on them. You can't group related charges and subtotal them. And your customization options are weaker than in invoices.

Statements lay out the customer's current financial obligation to you, including any statement charges, invoices, payments, unpaid bills and finance charges that have accrued during a specified period. Unlike invoices, they do not create new charges; they simply report on what's already been entered. Billing statements that outline historical transactions can be sent as reminders of past due accounts, or you can use them for customers who order frequently, to keep track of items until you're ready to bill and ship. They're also useful when you request payment in advance.

You should not invoice for any products or services that have already been entered as statement charges or the customer will be double-billed. Statement charges show up under Recent Transactions in the window adjacent to invoice forms; they also appear in the Customer Center and your Accounts Receivable account in the Chart of Accounts. And you can find them in the Customer Register (Customers | Enter Statement Charges).

Outlining the charges

If you want to enter new statement charges instead of an invoice for, say, a monthly billing or a customer who is ordering frequently but is not ready to be billed, click on the Statement Charges icon on the desktop. (If there's no icon and you want one, click Edit | Preferences, then Desktop View | Company Preferences, then click in the box next to Statements and Statement Charges.) Or you can just click Customers | Enter Statement Charges.

Click on Edit | Preferences to add Statement Charges and Statements icons to your desktop.

The customer register opens. Select the customer you want to create a charge for by clicking the down arrow next to Customer:Job. If you are in the middle of more than one job for the customer, make sure you make the correct one active.

Go down to the first blank line and change the date if necessary. Tab to the Item field, and drop the list to select the relevant product or service. Tab and enter the Quantity. The Rate and Amt Chrg should be filled in (if not, go back to Lists | Item List and edit the record). QuickBooks will have entered STMTCHG in the Type field. Tab to the Description field and complete it if it's blank, and select a Class if you'd like. Your window will look something like this:

It's very easy to enter statement charges in QuickBooks.

If you have another charge for that job or customer, go ahead and enter it. When you're done with charges for that job/customer, click Record.

Build a statement

You can create statements at any time from data already entered in QuickBooks. The process is the same whether you've just entered a series of charges, as outlined above, or you want to remind a customer of outstanding invoices. You're simply capturing all activity within a given time period. To do so, click the Statements icon on the home page. This window opens:

You'll select options from this window when you're building a statement run.

If the window contains an A/R field, that means that you have more than one receivables account. Be sure to select the appropriate one. Verify, too, that the date is correct. This will appear in the customer's register as the Billed Date.

Here, too, you can choose a range of transaction dates for your statement(s), or simply opt to create forms for all customers with open transactions (in the latter case, you can limit it to transactions that are more than 30 days past due). You must also indicate whether you want statements sent to all customers or a subset. You can manually choose one or many customers, or select by Type (commercial, residential) or Preferred Send Method (E-mail or Mail).

QuickBooks gives you some control over your statements' layout; click Customize if you want to explore this. Next, you can indicate whether you want to create one statement per customer or per job. The other options here are self-explanatory, but be sure to go through them every time you create statements.

Another decision

Will you be wanting to assess finance charges on the past due charges? This is a decision you should talk over with your ProAdvisor. It's a complex issue. Should you want to do so, though, clicking on Assess Finance Charges will open the Assess Finance Charges window.

When you're satisfied with all of your statement choices, you can Preview them. Here's an example:

Statements lay out all transaction activity within a given period. Statement charges appear as "Due." In this case, you're reminding the customer that there's a large past due balance as well as additional new charges.

Statements can be an effective way to let your customers—and you—get a comprehensive view of their financial interaction with you. They can be used instead of invoices, but there are limitations. If you're still unclear on how these forms can fit into your accounting workflow, your ProAdvisor can help.