Using the Apply Retainer Window
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The Apply Retainer Window is an extremely useful tool in reallocating a Retainer or Retainers to Deposits on Proposals or to Payments on Client Invoices.
To use the Apply Retainer Window, select a Retainer for the desired Project on the Documents and Accounting Window and click the Apply button.
The window appear similar to the New Cash Receipt Window but displays information regarding Retainers for the Project as follows:
Received: The total amount of Retainers recorded for the Project will be displayed in the Received field.
Previously Applied: The Previously Applied field will show the total of any Retainer amount that was utilized when making a Client Invoice in the Retainer field on the New Client Invoice Window - Invoice Tab and the portion of the Retainer(s) that have been reallocated using this window.
To Apply (from below): The total portion of the Retainer(s) that will be currently be reallocated will appear in the To Apply field.
Available: The Available field displays the amount of the Project Retainer(s) that can currently be reallocated.
In most circumstances, the sum of the Previously Applied, To Apply, and Available fields will equal the Received amount.
You can reallocate Retainer funds to either Client Deposits on Proposal or Payments on Client Invoices or both simultaneously:
You can select as many Proposals and/or Client Invoices as desired. As long as the sum of the Available amount is not a negative value, upon clicking OK, Design Manager will automatically create all of the proper entries to properly reallocate the Retainer funds. Most commonly, a single negative Retainer along with an individual Client Deposit and Payment for each selected Proposal and Client Invoice, respectively, will be created. The Date field will determine the date associated with each transaction.
If the Available is negative, you will receive a message stating "WARNING: The amount being applied is more than what is available.". This is generally an undesirable situation as you are effectively reducing the Project's Retainer balance such that it will now appear that the Client "owes" you a portion of the Retainer. However, there may be instances where you wish to "over pay" a Client Invoice so that it maintains a credit balance for the Client to use in the future where over-applying the Retainer has merit. In those situations, clicking OK on the message will process the reallocation.
Accounting: If the Retainer is being reallocated to a Deposit on a Proposal, essentially there is no net effect on any Account as the Client Deposit Account will be both debited and credited by the same amount for the negative Retainer and positive Deposit, respectively. When a Retainer is allocated to a Payment on a Client Invoice, the Client Deposit Account is debited (reduced) and the Account Receivable Account is credited (reduced) indicating both that the Client owes you less money for unpaid Invoices and you are holding less of their prepaid monies.