This article is to clarify some of the accounting differences across the platforms that Mosquito Squad uses to track business.
Pulse
Pulse has been updated with a series of tool tips that discuss the criteria behind the data. These are all accrual numbers--based on invoice dates, and not Service or Payment.
Most data in Pulse is in near real time.
(please note: revenue figures in Pulse will rarely lineup perfectly with the KPIs in Tableau. This is because Serviceminder tracks these metrics in a different way then the logic used in our Tableau reports"
Reports in Service Minder
Service Minder reports are generally based on invoice date (accrual). If you need a cash-based report, the Payment Reconciliation Report is your best friend. This is the criteria used to generate franchisee fees. To match the cash transactions, you need to set the Invoice Type to only include refunds--write offs and credit memos are non-cash events and carried here only for audit.
Cash vs Accrual and the Sync between Service Minder and Quick Books Online
This section is answering the question of timing of accounting entries generated in SM and sent to QBO:
Sales receipts (debits or credits) are sent on the date they are recorded. You may back-date as necessary, but this is not recommended. The same is true of payments.
It is a best practice to keep your QBO updated daily with regard to cash receipts batches.
Should you have adjusting transactions after the fact, as in a credit, this will be pushed to QBO with the date of the transaction which may be in a different accounting period. You may back-date the transaction, and will receive a warning in SM, but it is recommended that you not do this but use a general ledger entry in QBO.
Your accountant can better assist with adjustments and write offs. They should be recognized as recorded and not in the past. The take away here is to keep your accounts current and make adjustments monthly.
One key to remember, data _only_ flows from Service Minder to QBO and not the other direction, so get SM perfected and then clean up QBO. In the end, assuming you are running QBO in accrual mode, the test will be that your balance sheet matches the subsystems, e.g., cash, a/r, credit card flow.
In Control Panel>>Invoices there is a switch for cash or accrual mode. This does NOT affect the sync between SM and QBO. ? https://serviceminder.io/support/index/86 over as they are created regardless of this accrual/cash. This setting only affects the Month End reports (not all reports) – thus the “Month End Reporting Mode” label.
QBO will display reports there based on the cash/accrual setting in QBO and has nothing to do with SM.
Cash vs. Accrual and Reports in SM FAQ
- Does the customer have to provide payment information to be booked as revenue in service minder?
- Technically no, but practically, in most cases, yes. The client will accept the proposal and as part of accepting a payment plan (either 100% up front or paid over time), they will put in their card info. Regardless, we’ll go by the invoice date so if the proposal is invoiced up front, we’ll use that date.
- Is the total revenue for the proposal booked in the month of the acceptance or the month of service?
- Again, this will be based on the date of the invoice, which would typically be when the proposal is accepted. The exception to this is when proposals are bulk accepted. In those cases, the invoice date will be the date set for invoicing/payments when bulk accepting.
- Backlogs: it is my understanding that backlogs are not included in the service minder revenue reporting. How is a backlog defined? Customer accepts a proposal but does not provide payment information?
- Backlog is not typically recognized revenue. It reports the count of unstarted appointments and the sum of the dollar value attached to those appointments. For MS, the majority of appointments are $0 because they invoice on proposal accept. But for misting systems, they may invoice per appointment and so in that case, the backlog dollar value could represent unrecognized revenue since those appointments won’t be invoiced until they’re completed. And for locations that run with recurring appointments and invoice per appointment (the “maid service” model), the dollar value there also represents unrecognized revenue as those appointments are invoiced as they are completed.
Tableau
Tableau has reports based on invoices, cash receipts, and appointment value. The headers of each report should contain the details.
In general, most reports are in cash as this is how the franchise measures for royalties. So, any report that lists Cash Receipts (CR) is described as such. Examples are the Sales Awards Tracker, CR by State, or Revenue Averages.
Some Tableau visualizations use appointment value rather than invoice or cash basis. Appointment value is created by taking the invoice total without sales tax, and dividing it by the number of appointments created by that invoice. So, a $1,000 invoice with 10 appointments will carry $100 per appointment of value. Note that when appointment by period is displayed, it has nothing to do with either the invoice or payment date, but rather the service date of that appointment.
QBO
For Mosquito Squad, your QBO should be set to cash mode in the settings. Your accountant or tax professional is the ultimate authority with this, though. When submitting information from QBO to the brand, it should always be in a cash basis.
Accounting Terms and Considerations
Accounting Basis
- Invoices are accrual—all invoices created in each period. This is most of Service Minder.
- Most of Tableau is based on Cash Receipts. This is due to the fact that the franchise agreements are cash-based.
- The KPI report uses Appointment Value. It helps identify progress without regard for when an invoice is created or paid for. See the Appointments by Month for a good example.
If you invoice, receive payment, and service a customer in the same period, these numbers will all be the same.
Periods
- Most of Mosquito Squad lives in a calendar year period—franchise fees, marketing spends, and such. This is anything in the 12 months in use.
- Some reports are Year to Date (YTD). They should be identified as such, and any prior comparisons should be PYTD so you look at only the same amount of time in each period of comparison.
- Trailing 365 (T-365) is a good measure to smooth out seasonality. You’ll see this used in Tableau as a broad measure of progress.
Misc
- Errors exist, but with the help of users they are squashed. Report them to the helpdesk.
- Tableau’s numbers should consider all discounts as they look at an invoice/payment/appointment net.
(reviewed for updates on 12/24/24)