End of month sublet clearing account process

What reports and processes you follow in Eclipse for your end of month is a business decision, however, there are some suggested duties to do with clearing accounts that we recommend to ensure your departments are working together and that is accurately represented in your financials.

What are the clearing accounts?

In Eclipse there are two default clearing accounts. The Sublet Clearing and the Parts to Service Clearing account. They act as “work in progress” accounts for contracted work and parts sold internally before the service work has been completed and the customer has been invoiced. It’s a good idea to keep an eye on the end figure of these accounts at the end of the month to ensure it represents the open work your business has at the time.

How is the sublet clearing account used?

Sublet Clearing is an account used for the interim time between a sublet invoice being processed to a repair order while it is still in progress, and the repair order being invoiced out, and should not be used for anything else. What you are looking for is that the only results that are coming up are repair order numbers that are on the Open Repair Order report, anything else needs to be fixed or written off.

Understanding how the sublet posts to the ledger

There are different ways a sublet may post to the ledger, depending on how the sublet invoice is created; either in the Service module, or the Stock & Accounting module.

From the Service Module:

If a sublet has the ‘I want to add a creditors invoice from the supplier’ tick box selected within the RO, and the RO is yet to be invoiced the sublet posting should be alone like this: 

Once the Repair Order is invoiced, it will create the second posting and look like the below:

From the Stock & Accounting Module:

If you don’t allow your Service Advisors to create the invoice, and the invoice is entered by admin, you must have a process in place to cover how the cost is entered within the sublet in the RO in service. Below are 2 options for entering the invoice.  

You do NOT allow service to add a cost and you post the admin invoice straight to an expense account. The effect of this is sublets will be 100% profit on the service reports.
OR

You allow service to enter a cost but they do NOT tick the ‘I want to add a creditors invoice from the supplier’ tick box. You enter the admin invoice to the sublet clearing GL and you MUST have the type as RI and the RO number as the reference against the GL line within the Creditor Invoice.

As long as your reference is correct when entering the admin invoice, the clearing account will be managed by the system.  

How to monitor your sublet clearing account.

Run the ledger to get the results that are yet to clear out  

Run the ledger enquiry exactly like the below to bring the results of everything currently in the account that hasn’t yet been reconciled off against another posting.

Using the sort option set as “Reference” and “Reconciled” will remove lines that sum to 0 and have the same reference. When you run the ledger like this, there should only be figures in the debit column.

Your Sublet Clearing account may be a different number than the example below

Review dollar figure in account

You can do this by looking at the end figure on the last page of the results. That is the dollar figure of the Sublets costed to open Repair Orders.

This account should never be in credit.

Compare the end figure of the ledger results to the end Sublet column on the Open Repair Order Summary report; if you don’t mark up your sublets, the figure should match.

Open the Service Module and run the Open Repair Order Summary Report. Reports/Mailing > Reports > Open Repair Order Summary. Do NOT enter a start date and make the Report ‘As at Date’ the date you are running the report. For Sort Options, choose RO# > OK. 

Please note: If you do mark up the sale price of your sublets, you won’t be able to match the end figure of the ledger results and the open repair order summary report and you will need to spot check the oldest postings to make sure they have a corresponding open repair order.

Identify any postings that do not have an open repair order in progress. 

To do this, investigate using the date, client number and reference that you can see in the ledger. 

For example, the below is a screenshot from our test database that has 2 results that are for the same client and one of them is not referenced to a repair order. 

• The highlighted blue one is the correct one as it has a Ref1 of RI (Repair Invoice), so we can trust that this posting will get cleared out when the RO number 1013 is invoiced. 
• The posting highlighted pink will never clear out unless done manually since it was posted into the account using a creditor invoice (CIN) and isn’t referenced to a repair order.

Fix any postings that have been identified that don’t reference to an open RO.

Now you can go and investigate this posting that shouldn’t be in a clearing account and fix as required. You would investigate taking the client number and the Ref1 like below.

The ledger shows us that the invoice has been created twice, once from the Service module, by ticking ‘I want to add a creditors invoice from the supplier’, and then created once more from Stock & Accounting. In this case, you would most likely want to credit the invoice created from Stock & Accounting, as it does not reference the repair order.

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