The workflow begins with creating a client record.

During client setup, the most important configuration is assigning the correct sales tax code. Contact details, addresses, and other client information should also be entered at this stage.

Once the client is saved, all future projects for that client will inherit the selected tax and contact information.

· Adding a Client

Creating a client record has no accounting impact.

This step is informational only and does not create any financial transactions.

After creating the client, a project is created for that client.

The project will automatically pull in:

· Client information

· Address details

· Default sales tax code from the client

Before adding items, project settings should be reviewed carefully to ensure pricing methods, document settings, and tax configurations are correct.

· Project Pricing & Document Settings

Creating a project has no accounting impact.

Items are then added to the project. Items may originate from several sources:

· Manually created items

· Product Clipper items

· Inventory items

· Time entries

· Adding an Item

· Managing Inventory Items

· Adding a Time Entry

These items are considered estimates only.

· No revenue is recognized

· No expenses are recognized

· No accounting entries occur

Inventory items already carry a financial value because they exist within inventory assets.

However:

· Adding the inventory item to a project does not immediately impact accounting

· The accounting impact occurs later when the client invoice is posted

At invoicing:

· Inventory Asset decreases

· Cost of Goods Sold (COGS) increases

Client Status Report

The Client Status report is designed to be shared with the client. It shows pertinent information for each item in the specified project, including estimated pricing, invoice status, ordered date information, and more.

Profit Analysis

The Profit Analysis report provides both estimated and actual profit analysis for comparison. The report lists estimated and actual costs and prices for each active item in a project.

· Estimated profit is based on the estimated selling price from the proposal and estimated cost from the purchase order.

· Actual profit is derived from the item price on the client invoice and the actual cost from the vendor invoice.
​

Item Search

The Item Search function allows you to find specific specifications based on selected criteria. Nearly every custom attribute of each component in the system can be searched.

Once items are added, proposals are created and presented to the client for approval and deposit collection.

· Creating a Proposal

Proposals are considered pro-forma estimates.

Creating a proposal has:

· No revenue impact

· No expense impact

· No balance sheet impact

No accounting entries are created.

Proposal Listing

Displays proposals generated for projects that satisfy user-defined criteria, including:

· Proposal number

· Proposal status

· Requested and received deposits

· Estimated pricing

· Sales tax

· Proposal totals

Budget Analysis (Item Level)

Compares item budgets against estimated and actual prices currently recorded for the item.

Budget Analysis (Project Level)

Compares project budgets against estimated and actual prices currently recorded for the location or sales category.

Deposit Analysis

Displays a complete accounting of retainer and client deposit monies for a given project.

Proposals can be edited before invoicing.

· Editing a Proposal

Editing a proposal that has not been invoiced has no accounting impact.

Even if deposits have already been collected:

· The deposit remains attached to the proposal

· No accounting values change

After proposals are approved, deposits are typically collected from the client.

Payments may be collected:

· Through integrated payment processing (DesignPay or Stripe)

· Manually (check, wire, cash, Zelle, Venmo, etc.)

Integrated payments automatically record within DM Web.

· How to Set Up DesignPay

· DesignPay Settings

When the payment is first processed:

· Undeposited Funds increases

· Client Deposits increases

Undeposited Funds is a temporary asset account used for incoming payments that have not yet reached the bank.

When deposits are transferred into the bank account:

· Undeposited Funds decreases

· Bank Account increases

The client deposit liability remains available for future invoicing.

If the client pays outside of DesignPay, the payment must be entered manually.

· Record a Payment

When recording a manual deposit:

· Bank/Cash account increases

· Client Deposits increases

This reflects cash received from the client for future goods or services.

Cash Receipts Journal

Provides a detailed listing of all cash receipts entered for a specified fiscal period.

Open Client Deposit

Shows retainers and deposits collected from the client along with the application of deposits and retainers on client invoices.

Deposit Analysis

Displays a complete accounting of retainer and client deposit monies for a given project.

Proposal Listing

Displays proposals and associated deposit activity.

Sometimes proposals are canceled or adjusted after deposits have been collected.

· Enter a Client Refund or Credit

· Client Deposits decreases

· Bank/Cash account decreases

· No cash movement occurs when refunding on account

· Cash is moved to the retainer if “To Retainer” is selected

· Client Deposits value remains unchanged

· On Account creates a client invoice with a negative sell price, lowering A/R

After proposal approval and deposit collection, purchase orders are created to order goods or services from vendors.

· Creating a Purchase Order

Purchase orders themselves are operational documents only.

Creating a PO has:

· No accounting impact

· No expense recognition

· No liability recognition

Purchase Order Listing

Shows a list of all open and closed purchase orders.

Open Purchase Orders

Provides a list of all purchase orders currently open.

Unordered Components

Lists components that have not yet been included on a purchase order.

Once a PO is issued, order tracking begins.

· Order Tracking

Order tracking has no accounting impact.

It is strictly informational and reporting based.

Acknowledgement

Shows order tracking information for components that qualify for selected criteria.

Expected Ship

Monitors expected ship dates and other order tracking information.

Receiving

Shows receiving status and order tracking information for components included on purchase orders.

Purchase Order Listing

Displays all open and closed purchase orders.

Unordered Components

Lists components not yet included on a purchase order.

Vendor deposits and invoices are recorded against purchase orders.

· Enter a Bill

Vendor deposits represent money paid before goods are fully invoiced from the vendor.

When recording a vendor deposit:

· Vendor Deposits increases

· Bank Account decreases, or

· Credit Card Liability increases

The accounting impact depends on the payment method used.

Vendor invoices finalize vendor-side costs.

Work In Process (WIP)

· WIP increases

This represents goods or services purchased but not yet sold to the client.

Cost of Goods Sold (COGS)

If Bypass WIP was selected when recording the vendor bill:

· COGS increases instead of WIP

COGS represents goods that have been purchased and sold to the client. Some firms prefer purchases to post directly to COGS rather than WIP.

Vendor Deposits

Previously recorded deposits reduce the remaining invoice balance.

Payment Accounts

Depending on the payment method:

· Bank Account decreases, or

· Credit Card Liability increases

Aged Accounts Payable

Provides a list of all vendor deposits and invoices with unpaid balances.

Credit Card Purchases

Lists all vendor payables posted for a designated fiscal period that were paid using configured credit card accounts.

Disbursements Journal (Check Register)

Shows a listing of all disbursements or checks for a designated fiscal period.

Purchases Journal

Displays all vendor payables posted for a designated fiscal period.

Work In Process (WIP)

Shows components for which vendor invoices have been recorded but not yet invoiced to the client.

Open Vendor Deposit

Displays all vendor deposits not yet applied to vendor invoices.

Vendor History

Displays vendor deposit and invoice activity for the current year and prior years.

Purchase orders may require edits, cancellations, or refunds due to:

· Backorders

· Pricing changes

· Cancellations

· Returns

· Editing a Purchase Order

· Enter a Vendor Return or Credit

Vendor Deposit Refunds

· Vendor Deposits decreases

· Bank Account increases or Credit Card Liability decreases

Vendor Invoice Refunds

· Work In Process decreases, or

· COGS decreases (if Bypass WIP was used)

· Bank Account increases or Credit Card Liability decreases

These entries reverse the original purchasing activity.

Client invoicing is the most financially significant step in the workflow.
​

· Creating a Client Invoice

· Fixing Mistakes on a Client Invoice

· Client Invoice Adjustment or Override

When posting a client invoice, several accounting entries occur simultaneously.

Revenue Recognition

The sell price of goods and services impacts revenue accounts.

· Revenue/Sales increases

· Sales account selection is determined by the Sales Category

Cost of Goods Sold (COGS)

The cost side of the transaction is recognized.

· Work In Process decreases

· COGS increases

This converts previously accumulated WIP into recognized Cost of Goods Sold.

Sales Tax Liability

If taxable:

· Sales Tax Liability increases

The invoice date determines when tax appears on sales tax reporting.

Client Deposits Applied

Deposits previously collected on proposals are applied automatically.

· Client Deposits decreases

This offsets the amount owed by the client.

Accounts Receivable (A/R)

Any remaining unpaid balance becomes receivable.

· Accounts Receivable increases

This represents money owed to the business.

Aged Accounts Receivable

Provides a list of all client invoices with outstanding balances.

A/R & Deposit Summary

Provides a summary of:

· Total deposit available

· Retainer available

· Outstanding client invoices

Invoice Listing with Item Detail

Displays all client invoices posted for a specified fiscal period, including individual items.

Sales Journal

Shows a detailed listing of all client invoices posted for a specified fiscal period.

Sales Tax Report

Shows sales tax owed to various tax authorities for a given calendar period.

Statements

Displays outstanding client invoices configured for emailing to the client.

Client Status Report

Displays pertinent project and item information for clients.

Profit Analysis

Provides estimated and actual profit analysis for active project items.

The final step in the workflow is collecting payment on outstanding client invoices.

· Record a Payment

When recording a payment against a client invoice:

· Bank/Cash account increases

· Accounts Receivable decreases

This reflects the collection of outstanding customer balances.

At the end of a project, it is ideal to perform a thorough review to ensure the project is fully finalized and all loose ends are tied up.

The following reports should be reviewed:

Aged Accounts Receivable

Shows outstanding client invoices that still require payment.

Open Client Deposit

Displays retainers and deposits that have not yet been fully applied.

Pre-Billing Report

Identifies items that have not yet been fully invoiced.

Aged Accounts Payable

Shows vendor deposits and invoices that still have unpaid balances.

Open Vendor Deposit

Displays vendor deposits not yet applied to vendor invoices.

Work In Process (WIP)

Shows components with vendor invoices recorded but not yet invoiced to the client.

Project Profit & Loss

Displays accounting activity associated with a specific project and helps determine project profitability.

Sales tax is reported based on the date of the client invoice along with taxable sales.

Remitting collected sales tax to the appropriate tax authority is typically required monthly or quarterly.

Payroll is a recurring task that may occur weekly, bi-weekly, or monthly.

Related Resource

Entering Payroll

Managing inventory is an important quarterly, bi-annual, or annual task.

Related Resource

Managing Inventory Items

Recording payments against credit card accounts helps track liabilities and assists with reconciliation.

Related Resource

It is important to keep checkbook records in agreement with bank records.

Reconciling cash accounts monthly is strongly recommended because errors can occur either at the bank or during transaction entry.

Related Resources

· Checkbook Reconciliation

· Credit Card Reconciliation

This workflow article outlines the basic operational and accounting flow of Design Manager along with helpful reports and supporting resources.

This guide covers the general functionality of the system and does not outline every specific feature or workflow variation within Design Manager.

To learn more about Design Manager and newly released features, please visit the DM Web Help Center:

https://help.designmanager.com

If you have any questions, Design Manager Support can be reached at:

Support@DesignManager.com

Support Hours: Monday through Friday 9:00 AM – 5:00 PM