Practice Ignition will mark your invoices as paid automatically, but you'll still need to reconcile the disbursals you receive in your bank account. Read on below for instructions on how to set up a bank a rule to simplify this process.
But first, let's review the process by which Practice Ignition marks your invoices as paid.
Marking customer invoices as "paid" in Xero
If you have Xero integrated with your Practice Ignition account, and you enable payments for your proposals, your invoices will automatically be marked as paid in Xero once the payment has cleared in your bank account.
The first time a payment is processed in by Practice Ignition, a clearing account will be automatically created in your Xero Chart of accounts, called PI Clearing Account.
As payments clear, they are listed as debit transactions in the clearing account, and linked directly to the corresponding invoice, marking it as paid.
If you click into the transaction you can see it is linked to the invoice -
And we can see the payment has been applied to the invoice and it is marked as paid.
Setting up a bank rule to reconcile your disbursals.
Rather than depositing each and every payment you receive via PI individually, each day (depending if payments have been received) we pay you a 'Practice Payment' which is a lump sum of all the client payments that have cleared overnight. This will save you hours in reconciling your bank statement!
If you wish to reconcile your bank statements as well, you will need to allocate each of these Practice Payments to the PI Clearing account to balance them.
Please see below for the specified rule depending on your region:
FOR ANY REGION OUTSIDE THE UK
Create and label two descriptions called PracticeIgnition and Practice Ignition, so the payments are reconciled correctly. Below is a screen shot example of the rule you will need to create. Also please ensure you have the correct tax rate within the bank rule.
FOR THE UK
You must label the Description as IGNITIONPAY, so the payments are reconciled correctly. Below is a screen shot example of the rule you will need to create.
Also please ensure you have the correct tax rate within the bank rule.