A Pro Forma invoice is an invoice that gets created but, since it's not paid immediately, will not have an invoice number yet.
The big advantage of this is that, as long as an invoice is still in the Pro Forma phase, it can be edited or even deleted without it influencing your invoice numbering. This also means multiple transactions can be bundled on the same Pro Forma invoice, resulting in less invoices that need to be paid.
Only when a Pro Forma invoice is handled (exported, emailed, paid, etc.) will a final invoice be created with correlating invoice date. This means that your invoice numbers can always be found in the right order in your system.
In this article the following things will be discussed:
- What does Pro Forma invoices mean exactly?
- Difference between Invoice date & Book date
- Merging multiple transactions in Pro Forma invoices
- Turning Pro Forma Invoices into final invoices
- Pro Forma Invoies in combination with Family Memberships & Company Invoicing
What does Pro Forma invoices mean exactly?
From now on, every invoice that's created by you or the system, will be created as a Pro Forma invoice. This means that where you used to see an invoice number, it now shows you Pro Forma.
Displaying Pro Forma invoices in the "Financial" app
A Pro Forma invoice, as said before, doesn't have a final invoice date yet. A Pro Forma invoice always has the date of today. This is because all outstanding Pro Forma invoices are moved to the current date every night.
This makes sure that no Pro Forma invoices are left behind in an earlier period, and you can clearly see your final revenue of the last month at the start of a new month.
In the financial overview in the app Financial you will see the difference between Pro Forma and Final invoices:
IMPORTANT: For tax purposes, always use the amount of Final invoices.
Invoice date versus Book date
With the introduction of Pro Forma invoices, an adjustment has been made on the way the dates are displayed in the invoice itself and in the overview of invoices.
The invoice date, on the top left of the invoice, is now always the date on which the invoice was turned final.
Especially for invoices of memberships this is a big change. Where before the invoice date was the start date of the new membership period, it is now always the creation date of the final invoice.
Next to that, the book date has been changed, which can now be found in each individual product on the invoice.
This date is always...
... For Membership invoices: the startdate of the membership period
... For Point of Sale invoices: the date the product is sold
... For Manual invoices: the date of creating the invoice
This date will never change, while the invoice date gets decided once the Pro Forma invoice is turned final.
Important to realise
Because the invoice date & book date have been switched around, it's possible that the invoicing for next month will be moved to the month before. This will happen to for example the monthly debiting, when you debit your clients on the 25th of each month for the memberships of next month. These invoices will now get the invoice date of the 25th, where before they would get the invoice date of the first of the next month. This could result in a double amount of invoices in one month, because for the last debiting round the invoices were still set on the first of that same month. This will only occur once of course.
Would you like to prevent this from happening? You could wait to make the invoices final until the first of the next month, so the invoices will be dated in the same month as the memberships are for.
Merging multiple transactions in Pro Forma invoices
Because Pro Forma invoices are not made final right away, it is possible to merge multiple transactions in one Pro Forma invoice. Different products/payments/membership transactions can be bundled into one invoice.
Deciding your settings
To decide which types of invoices can be merged, you follow these steps:
- Go to the app Business Settings
- Under Membership & Billing, click on Financial Info
- Go to "Invoice merging options"
- Change the settings according to your wishes
Please note! Changes in these settings will only affect newly created invoices. Already existing invoices will not be merged.
For manual-, Point of Sale- and membership invoices you can decide if those invoices should merge together with other invoices. The default option is set to no other invoices for all three.
Per invoice type you can change this to
- Only invoices of the same type: this type of invoices will only be merged with invoices of the same type
- All other invoices: this type of invoices will merge with all other types of invoices
For example, you can choose to merge manual & POS invoices together at all times, but have Membership invoices only merge with other membership invoices.
The following rules must apply for two transactions to be merged on one Pro Forma invoice:
- Both transactions are not paid immediately
- Both transactions are set to the same payment method
- The setting to merge invoice has been enabled in Business Settings
Let's say you sell a product to a client, but you do not let the client pay right away. This product will be created as a Pro Forma invoice. At the moment a second product is sold to the same client on the same payment method, both products are merged together into one Pro Forma invoice.
In practice this means that when a client buys 20 coffees in one month, all these coffees will be bundled into one invoice. Dependent on your settings, it might even be merged with the membership invoice.
Turning a Pro Forma invoice to a final invoice
When it's time to process the Pro Forma invoice, it will need to become final. This happens automatically when one of the five events occur:
- The invoice is downloaded in a SEPA file
- The invoice is exported into an Excel, CSV or PDF file
- The invoice is printed
- The invoice is emailed with or without a payment link
- The invoice is set to paid
Once one of the above proceedings are done, the invoice is made final and therefore gets an invoice number. Once this is done, the invoice can no longer be edited or deleted, only credited.
Newly created invoices will from that moment on become a new Pro Forma invoice, that can be merged with other new invoices. These will no longer be added to the final invoice with invoice number.
Pro Forma invoices in combination with Family Memberships & Company invoicing
With the introduction of the Pro Forma invoicing, the use of Family Memberships has become even more attractive.
Where before all invoices were created one by one on the name of the primairy (paying) client, now all these Pro Forma invoices can be merged together as well.
This way, you can easily connect a family to each other where the head of the family pays for all memberships/Point of Sale products/invoices. These payments will all be merged into one invoice, of course taking into account the options you've selected in the Business Settings.
In the overview of the invoices of the Primary Client it will now look like this:
In the invoice itself it'll look like this:
Bundle invoice for company employees?
When multiple clients are working out in your club through the same company and this company is paying the membership costs for these clients, they can also be merged into one invoice. For this it's important to set up the company as if it is the Primary Client.