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Preparing and Sending an Invoice
Preparing and Sending an Invoice

A comprehensive guide on managing invoices in Karbon, including adjustments for billable time, fixed fees, expenses, and more.

Erin Jamison avatar
Written by Erin Jamison
Updated over a week ago

When creating invoices from Unbilled in Karbon, you need to add them to a draft billing run (only draft invoices will be visible in the options). If you are creating a single invoice, you will be taken directly to that invoice. If you are creating multiple invoices, you will be directed to the chosen billing run, where you can drill down into the specific invoice you want to start with.

Please keep in mind if you have a draft invoice for a work item or contact and add additional time entries, these will automatically be added to the draft.

When you view a draft invoice, you will see three tabs:

1. Data

2. Presentation

3. Activity & Comments

This guide focuses on the Data section, where you can make adjustments to the draft invoice before sending it to clients.

Index

Each invoice will list out the billable items, such as Billable Time, Expenses, or Fixed Fee work. The adjustments you can make and the information provided vary depending on the billable item type.

Billable Time (Time on Work or Contact)

Write On and Off for Billable Time

For billable time you can adjust the amount value at the total amount level or for each row. If calculated at the total amount level, the system will distribute the write-on/off amount across each row based on the hours and billable value per combination. If done at the row level, it will calculate the write-on/off for that specific time entry.

For example:

  • If you did $100 worth of work for a client but only budgeted $50, you have a write-off of $50.

  • If the budget is $150 but the work was done for $100 and you still charge the client $150, you have a write-on of $50.

Carrying Time

If you decide not to bill all the time entries listed on the invoice and want to bill them later, you can carry the time entries. This can be done individually or in bulk by selecting the checkbox and clicking the 'Carry' button. Once the invoice is approved, these time entries will appear back in the Unbilled section. If you want to re-include time entries before approving the invoice, select the checkbox again and click 'Include'.

Unused Time Entries

If there are unused time entries (including unassigned) on the work item, they are aggregated into one row to give the user the necessary information without overwhelming the screen.

Fixed Fee

When viewing Fixed Fee billable types on an invoice, less data is shown since fewer decisions need to be made. You will see the item name (work item) and carry and write-on/off columns.

Carrying

Unlike billable time, you cannot carry individual time entries for Fixed Fee items. Instead, you can carry the invoice amount if the Fixed Fee Item is marked as a progress bill.

Adjusting the invoice amount to a lower value will carry the remaining amount to the next invoice and appear back in Unbilled when the invoice is approved.

Write On/Off

For Fixed Fee items, the system calculates the write-on/off based on the difference between the time entries recorded on the work and the total Fixed Fee amount set on the work item. The system only calculates the write-on/off if the Fixed Fee item is marked as a Final Bill.

For example:

  • Fixed Fee Total Amount = $500. Time entries recorded = $600. Write-off = $100.

  • Fixed Fee Total Amount = $500. Time entries recorded = $400. Write-on = $100.

  • If no time entries are added, no write-on/off will be recorded.

Amount

For Fixed Fee items, you can also adjust the amount value. If the item is marked as a Final Bill, changing the amount value will increase the total amount of the invoice without changing the write-on/off value. If the item is marked as a Progress Bill, it performs the carry action.

Expenses

Expenses can be manually written on/off by changing the amount column. They cannot currently be carried when on a Fixed Fee item, but if recorded against a Time and Materials work item, they can be carried exactly like Billable Time.

Final Bill Toggle

Next to each work item on the invoice is a toggle indicating whether it will be the final invoice for that work item. For Fixed Fee items, this means the Fixed Fee work will no longer appear back in Unbilled after the invoice is approved unless expenses are added.

For Time and Materials work, any time entries or expenses added after the invoice is approved will continue to appear back in Unbilled, even if there is a Final invoice.

The Final Bill Toggle is off by default for Time and Materials work items and on by default for Fixed Fee items. If there are billable items for the same work (e.g., expenses and time) and you toggle it on for one item, it will turn the toggle on for all billable items attached to that work item on the invoice.

Customizing the Invoice

Invoice Name

If you're not sending a tax invoice to one of your customers, you can change the field that appears on the invoice from 'tax invoice' to 'invoice'. This can be set on the invoice template or on a per-invoice basis.

Best Practice Tip: For consistent invoice appearance, set this field on the invoice template.

Individual Time Entries

You can choose to display invoices by individual time entry (for billable time) on the invoice template and from the presentation tab on each invoice. If this option is set on the template, all future invoices will display individual time entries if applicable.

When selected, the quantity column will represent hours, and the unit price will be the time entry rate. If the summarized option is chosen, the columns remain unchanged.

If a write-on or off is applied, the quantity column will update to keep the unit price consistent between invoices. For example:

  • Data tab: Time entry with 1 hour at $100 rate; actual = $100; amount changed to $150; write-on/off = +$50


  • Invoice presentation: Quantity = 1.5; Unit Price = $100; Amount = $150


Display Options

Within the invoice template, you can remove the quantity, unit price, amount columns, and the amount breakdown from the invoice. This setting can be applied to all future invoices or overridden per invoice.

Invoice Actions

When viewing a draft invoice, you can approve or approve and send it.

Approve and Send

This feature allows you to approve and send the invoice immediately. The system will confirm the to and from email addresses before sending. If sending is canceled, the invoice will be in an approved state.

Sending Issues

Certain issues can prevent the invoice from being sent:

  • No Accounting Period: Set it in Billing Settings before sending invoices.

  • Invoice Date Not in an Open Accounting Period: Select an invoice date in the current accounting period.

  • Negative Invoice: Resolve issues if the invoice total is negative.

  • Missing Details: You will be prompted to add missing details before approving or sending.

Once successfully sent, the email and a PDF version of the invoice will appear in the sent folder in Triage. Due to privacy, invoices are not automatically added to timelines.

They can be manually added or shared with colleagues via email comments.

After sending, the invoice moves from the Draft list to the Awaiting Payment list.

Approve

You can choose to approve the invoice without sending it. Once approved, you can perform the following actions:

Sending

The same rules and checks apply as when approving and sending. You can edit the invoice by putting it back into a draft state if needed.

Exporting

If using QuickBooks Online (QBO) or Xero, you can export invoices from Karbon. Click 'Export to QuickBooks Online (QBO)' or 'Export to Xero' from the approved list or the triple dots at the bottom of the invoice. The invoice will then move to the Exported section.

Please keep in mind: You cannot export and send an invoice. Each invoice can only be exported or sent.

Editing an Approved Invoice

To fix errors or make other changes, you can edit an approved invoice. This will move the invoice back into Draft, and it will need to be approved or sent again.


Approved invoices cannot be edited if:

  • The work item or contact associated with the invoice has been deleted.


  • There is an existing draft invoice for a work item on the approved invoice.

Voiding an Approved or Sent Invoice

To void an invoice, click the triple dot option from the invoice list. Once voided, the invoice will move to the Voided section, and the items will return to the Unbilled section.


Resend or Download an Invoice

For invoices marked Awaiting Payment or Paid, you can resend the invoice via a Client Request or download it as a PDF. This option is available in the 3-dot menu of these invoices and in the receivables area for each client.


You can also multi-select and resend invoices in bulk to your clients.

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