Philip Stanley's dashboard

Fab. Thanks Amy. – Philip Stanley, on September 15, 2009 18:21

Hi Joanna,
Thanks for spotting that - I'll drop that question off the list. I'm on hand if people get stuck or for any technical questions about how to use the site (and I'm glad you like it).

Philip

You're welcome Emz - thanks, and props for looking first before firing off a question!

I'm assuming that it's a limited company set-up, sounds like you are contracting, in which case I think you would be OK to choose Money Paid to User and mark the initial purchase as a payment from your Director's Loan Account (i.e. the company has loaned you the money for the bike purchase), which you then repay with the second transaction using Money Received from User - payment to Director Loan Account.

One caveat: Ideally it doesn't end up as a loan of over 5K... and it was short term (i.e. you didn't buy it a year ago) In either of these cases you'd want to check your options a little further.

And if you are telling a friend, make sure you are using the referral code in your settings - it will benefit you both.

... and I like the way it is now as it lets me jump straight to the quote for some work. Nothing worse than being locked into an inflexible workfow...

So, all rosy just up until the point where I want to send a past due reminder... where I'd like options to create a few 'n' days, 'n+x' days, 'n+x+y' days reminder templates, and choose manual/auto as a button press to send them out as the days tick by. But hey, I know you are working on that..;-)

Strewth! Sorry about that, what was the question?

A Proposal would be a description of how you might answer a brief or query, it may or may not have any figure(s) attached. It may masquerade as an estimate, being essentially a list of items with a introduction/method.

An estimate would be an assessment of the cost of implementing your proposal based on current knowledge. It is generally understood in business to not be an offer, though often is read as such by consumers. You may expect it to vary according to conditions and new information on progress of the work, but note that naive clients might expect it to _not_ vary... If a contract is formed with just an estimate as the paperwork there is potentially more flexibility for the supplier, but a customer could push back on reasonability grounds if you were to try and stuff them, particularly if you should have reasonably been expected to have known about the extra costs and were misrepresenting the true cost.

A quote is generally considered a firm commitment to a final price and is an offer that can be accepted by the customer to form a legally binding contract (with that intention), and suppliers may find it difficult to negotiate an increase, unless the change were reasonable (extra work on uncovering dry rot in a building for instance, or clear increases in project scope, or identified customer generated delays etc.)

In most business, using the language above, the flow would be:

1) Query or Enquiry received
2) Proposal sent (generally with ballpark single headline figures)
3) Extra information received in response, with a request for a more detailed estimate
4) Estimate sent (level of cost detail increased, options included)
5) Request for a Quote received (identifying final selection of options)
6) Quote with number/identifier sent (including scope limitations and terms)
7) Numbered Purchase Order for Quote received (including terms etc.)
8) Work Done
9) Invoice against Purchase Order sent
10) Payment received

Forming a legally binding contract doesn't need any paperwork at all - just agreement/intention to enter into a legally binding contract, consideration and reasonability. If you shook on, said, wrote, estimated or quoted it would cost about or exactly £2000, were paid some or all of that, did most of the work and a week from finishing went back with a bill for £8000 there would be some sorting out to do...

Consumers have some statutory rights relating to reasonable cost, business customers need to take more precautions, as do suppliers. Should a contract be judged not to be in place for all or part of the work (It's £8000 because you did £6000 of 'extra' work which they refuse to pay for because "it wasn't in the quote" but YOU say they requested additions during the course of the work), it might mean looking at a Quantum Meruit claim for 'what the job is worth'. However, the sorting out the value of work done in a billing dispute, who asked for what when, and whether they thought/might reasonably have been expected to think you would bill them is a very big pain in the arse. Especially if the work stretches over a few months and you're scratching around for evidence of justification and instructions that were given.

Best pay attention to what you put in the paperwork and the expectations you are raising in the client throughout the progress of the work, don't let the bill creep up without recording assent along with the instruction... – Philip Stanley, on July 21, 2009 13:51

The difference and functionality is more understandable if you wish to track the money movement from account to account - e.g. one has a bank account (with or without plastic), but one's other visa credit card / debit card etc. is with Virgin or someone other.

In that case you would track any business purchases made with your business 'credit card' in your 'credit card' account, and track transfers (monthly payments, interest etc.) from your business account to your credit card account as needed.

In example, currently I do not differentiate between a direct debit / standing order payment or card payment if it comes out of the business account - effectively the only real difference is as you have pointed out, clearing times - but I have separate accounts set up in FreeAgent for various Visa and Currency Card accounts that are exclusively (well, 90+%) used for business.

That takes care of most expenditure, but IF I use my personal visa etc. (which are NOT set up in FreeAgent) then that particular expenditure goes through "out of pocket" expenses...

Hope that helps.

Philip

Hi Mac,

I can appreciate that the balance of business payments through your personal account in the interim before you have a separate account has upped the number of transactions somewhat and made it a little daunting to think about entering the expenses manually.

You could just enter them through the Out-of-Pocket list, but if you are going to be entering a lot:

You could just delete all the transactions in your account on FreeAgent rather than delete the account proper, download the bank statements, open in a text editor or Excel and delete all the personal stuff / lines.

Then import the file you have just edited into FreeAgent.

In this way the auto-fill features of FreeAgent based on the explanations you've already made will work for you on that triaged file. To my mind you're not really being reimbursed for your business expenditure at the moment, all you are doing is making a note of what you are spending on the business.

Doesn't matter whether it's coming from your personal account or rolls of dollar bills under the mattress - you just need to explain what it is for, so that when you take money out of that single account _that_ money isn't seen (or assessed) as earnings...

weeelll, that is until you've used up all the expenses you have noted down.

Philip