In this article, you will learn how to configure your billing settings. This screen will have different options available to different users based on what plan they are on. All sections will be available in Actionstep's Practice Pro + Accounting plan. We list beside each section if it is not available in Practice Pro or Express.
There are a lot of sections to explain in Billing. To skip to the section you want to know about, use the links below:
Billing Settings, as the name suggests, determines how billing functions within your system. To access the billing settings, navigate to:
Admin -> Billing
Participant Type Setup
Responsible Lawyer: Actionstep is a very user-configurable system so we need help knowing what participant type you would like to be configured as the 'Responsible lawyer'. This role has special functionality in Actionstep for things like fee allocation and reporting. Typically, it is the person who is responsible for the overall outcome of the case.
Every billable Matter type should have this participant type configured. When there is no participant defined for a particular Matter then it will fallback to the assigned-to participant as the Responsible lawyer.
If you have more than one contact loaded against this role on your matter, then the first person loaded will be the Responsible lawyer. For example, if the responsible lawyer field is set to the role 'Partner' and a matter has both Mary and Rob assigned to the Partner role on it, then Mary will be the responsible lawyer as she is the first contact loaded to that role.
Some systems will allow you to set an Alias for the 'Responsible lawyer' so that you can change what it is called in your system. From "Responsible Lawyer" to Partner Responsible", for example.
In this section, you can choose defaults that will be applied when you go to process a payment against a bill you have sent to a client. Users will still be able to choose other values but by correctly populating this section, you will speed up the entry of these transactions.
Matters can be billed using either a fixed fee or an hourly fee billing arrangement. In this section, you choose what default will be applied to the way a matter is billed when an hourly billing arrangement is applied to a matter. There is an identical section for fixed fee invoices below.
Default description for increase in fees: As you create a bill in Actionstep you can choose to increase your fees from the value that has been recorded against the matter so far. When you do this, you have the option to create a new fee record to account for the increase. The 'Default description for increase in fees' will populate that fee entries description.
While you may not show want to show the increase in your fees, if you do, populate you want that increase in fees to appear as in this field.
Default description for discount: Similar to the increase field above, when you apply a discount to the fees on an invoice you can choose what the default description for that discount will appear as to the user.
If WIP less than quote: This field is used when you mass bill a matter. Using Actionstep's mass billing, you can move all the WIP that is loaded against a matter into draft invoices in bulk as one quick process.
In this field, you choose what will happen if the WIP (the unbilled fees on the matter) is more than the quoted amount on the matter. The quoted amount is a field populated on the Matter Billing Options screen. If the WIP is less than the amount that has been entered into the Estimate field, you can choose to:
- Ignore the Estimate amount and bill the WIP only
- Ignore the WIP amount, and bill the Estimate amount only
- Add the Estimate amount to the WIP to bill both.
Users are able to change this setting on a matter by matter basis on the Matter Billing Options screen.
If WIP greater the quote: This field works exactly the same as the 'If WIP less than quote' field(see immediately above). The only difference is choosing what will happen when the WIP recorded is more than the estimate or quoted amount on the matter.
Fee reductions: This field sets how a discount or fee reduction on an invoice should be treated when the invoice is mass billed. 'Appear as a discount' will ensure that the bill to the client includes a line that states a discount was given and how much it was. 'Hide line pricing and show total only' will still list each fee record in the bill and all its details except the amount for that time. This way there will not be a discrepancy when adding up the individual items and comparing them to the total fees.
Include value of 'Hide' and 'No charge' time when calculating fee allocation: Each fee record in Actionstep can be set to 'Bill' to bill the time, 'Hide' to not show the time record in the bill at all, or 'No charge' to let the time record show in the bill but have no billable value to it.
In this field, you can choose if the time which is marked as 'Hide' and 'No charge' will count towards a fee earners fee allocation for that bill or not.
Some might not want to consider fee allocation for fees/time that has no billable value, in which case they should leave it unticked. However, some firms recognise that while the fees did not increase the bill they did contribute to the value and effort to produce the bill so they tick the box to allow fee allocation to take into account those 'Hide' and 'No charge' fees.
Allocate adjustments: An adjustment to an invoice is an increase or reduction in the fees that are being charged when compared to the WIP on the invoice.
This field lets you choose how that reduction or increase in fees should be allocated. You can choose to allocate them to the responsible lawyer (used when the gains or losses on an invoice can be attributed to the responsible lawyer) or to pro-rate the amount among the fee earners on the bill.
For example, if you use the 'Based on fees entered' option on an invoice in which 3 fee earners recorded $1000 each of time and had a $300 discount, then each fee earner contributed one third each so the discount will be divided by three and applied to each. In this case, each fee earner will get a total fee allocation of $900.
Bill template: This will select the default template that will be applied to any invoice generated from a matter set to the Hourly invoice billing arrangement. This can still be changed on a matter by matter basis or an invoice by invoice matter.
Email template: This will select the default email template that will be applied to any invoice generated and sent from a matter set to the Hourly invoice billing arrangement. This can still be changed on a matter by matter basis or an invoice by invoice matter.
Default time entry behaviour: Each fee record in Actionstep can be set to 'Bill' to bill the time, 'Hide' to not show the time record in the bill at all, or 'No charge' to let the time record show in the bill but have no billable value to it.
The 'Default time entry behaviour' field will set any fee entry created for a matter set to the Hourly invoice billing arrangement to use the selected behaviour.
Fixed Fee Invoices
Matters can be billed using either a fixed fee or an hourly fee billing arrangement. In this section, you choose what default will be applied to the way a matter is billed when an fixed fee billing arrangement is applied to a matter. There is an identical section for hourly invoices above.
Please see the explanations in the section immediately above for more details.
Custom Bill Templates
In this section, you will be able to edit existing bill templates or upload new ones. Click on one of the existing templates to bring up the 'Edit custom bill template' pop-up window. On the right-hand side of this window, you should see the built-in templates, which you can download and update to your liking.
To create a new custom bill template click the blue button.
Timekeeper Fee Allocation
Default fee allocation for matters: Allows you to choose the default configuration of how fees are allocated between timekeepers.
By setting this to 'Pro-rate', the fee allocation will be set based on how much a fee earner has contributed to the value of an invoice. For example, a lawyer who contributes to 25% of the value of the bill, will get 25% of the fee allocation (though other settings can also affect this).
By setting this to 'All to Responsible lawyer', then all fees, regardless of other fee earners that contributed to the bill, will be allocated to the Responsible lawyer.
Some firms will create separate income accounts in their Accounting General Ledger for specific fee earners or the teams that they belong to. You can click on the button to be able to see a list of all system users and to set an income account against each.
A simple toggle for enabling/disabling taxes. Once switched on you can choose to tax new matter by default, the default tax rate and if those sales taxes should be applied to fees and expenses or just one of those options.
In this section, you can set some defaults to how your bills or invoices will behave in Actionstep.
Invoice defaults: Will set the payment term that will be applied to your bills by default. For example, if you set this to 7 days you are asking the client to pay the bill within 7 days of the bill being sent to them.
Below 'Default payment terms', you can see the different types of payment terms you can apply. It is possible to create a new payment term or click and edit an existing payment term but it does require to understand some computer coding to achieve. Reach out to our support team if you want help with this.
Next invoice number: This will set what number the next invoice you create in Actionstep will have. If you have previously increased the number in this field you are able to reduce it again but it will let you use the same number twice.
Default additional notes: Every bill you create in Actionstep will have a section on it called 'Additional notes' that you can populate to insert a message into the PDF bill that you send to your client. This section allows you to populate that field by default.
Use this section if you want to add a message to your bills such as payment details or your Law Society compliance text. You can still customise the additional notes field on each individual matter.
Default Income Accounts
The default ledger accounts that these invoice items will be posted to. You are able to which income accounts on your general ledger your fees and expenses will be coded to by default.
There are ways to change or override the default for an expense or fee record depending on different settings but this will set how the majority of records will be applied to your General Ledger.
Allows you to enable general retainers within the system. When you enable the option, you will have more options to configure.
Liability account: This is the account in your general ledger that Actionstep will need to know to be able to process your general retainers. The default chart of accounts in Actionstep will come with a General Retainer Liability account for you to map to. Please note that once you select this account and save the settings, you will not be able to map it to another account.
To Pay: If you have funds in general retainer for a matter, they will be applied to any new charges that you create (new bills) for that matter.
Payment automation: You can choose to pay invoices automatically as you create them from any available funds in the general retainer. If you choose the 'Manual' option you can still apply payments from retainer as you produce a bill but this will have to be manually entered.
These settings will determine how trust funds are applied against bills.
To Pay: If you have funds in trust for a matter, they can be applied to any new charges that you create (new bills) for that matter.
Payment automation: You can choose to pay invoices automatically as you create them from any available funds in trust. If you choose the 'Manual' option you can still apply payments from trust as you produce a bill but this will have to be manually entered.
Combine multiple payments by: You are able to combine payments from different matters as long as the trust bank account that the payment comes from is the same.
Statement on bill: As you produce a bill in Actionstep, that bill might be configured to show trust account transactions on it. In this field, you can set if the transactions shown should be all trust transactions for that matter or just the transactions that have occurred since the matter was last invoiced.
In this section, you can create and customise your rates that you apply to fees or time records. You can create rates that are on a per-hourly basis or for a fixed amount.
A list of each of the rate labels in your system will be displayed. Click on the name of an existing rate label to be able to edit it.
You can create a new rate label by clicking the button.
Create / Edit Rate Labels
When you create or edit a new Rate lable there will be three fields available:
Rate label: This will be how your rate will appear to the user when the select it in a fee/time record.
Entry type: There are three types of entry types available:
- 'Hourly rate' will let you set a per hour rate for the rate label.
- 'Fixedfee/flat rate' will let you set what the amount that a fee or time record will be charged at, regardless of the time spent on it. When you select 'Fixedfee/flat rate' on the Add/Edit rate label screen the 'Base rate value' field will be removed as the rate is set per fee/time record. You only need to create one fixed 'Fee/flat rate rate' label in your Actionstep.
- 'Customizable hourly rate' is a rate where the user can enter in the per hour rate on the fee/time record. When you select 'Customize hourly rate' on the Add/Edit rate label screen the 'Base rate value' field will be removed as the rate is set per fee/time record. You will only need to create one 'Customize hourly rate' label in your Actionstep.
Base rate value: This is the per hour amount that will be charged for that rate label. The amount you enter will be exclusive of any sales taxes.
Customize rate value by Timekeeper: This tick box only appears when you select an 'Hourly rate' Entry type. Once ticked, you will see a list of the user to your Actionstep system. Beside each, you can specify what the hourly rate for that user should be for this rate label.
If you populate an amount in the box, when that user uses this rate label it will apply that per hour rate to the fee. If left blank, the 'Base rate value' will be applied.
For example, if you create a rate label called "Attorney" with a Base rate value of $300. If you then allow customized rate values by timekeeper and enter $320 beside Robert and leave Tyler's box blank, when Bob goes to record time and selects the "Attorney" rate label, his time record will be set to $320 per hour. If Tyler was to do the same, his time would be set to $300 per hour.
Expense / Disbursement Templates
In this section, you can create templates for the expenses that you enter into Actionstep. By creating a template you can speed up the entry of an expense.
LEDES billing (also known as UTBMS) is where the items in a bill are assigned to a pre-set list of tasks based on the activity, what it is for and who is doing it. This system is a requirement for some clients who use this method to compare the amounts they are billed from multiple lawyers.
FX billing is the ability to create bills in Actionstep in another currency. There can be a setup process to allowing your system to use multi-currency billing but once done, you can switch it on in this system and set the converstion rates that will be applied to the other currencies you can bill in.
FX billing will take the base currency that is set in your system (the currency that you normally bill in or that you report financially in) and create a conversion rate that will convert that into a different currenies.
A default conversion rate is a rate that the normal time you bill in will be converted into when you bill in a different currency.
For example, if you normally bill in US dollars (USD) but sometimes bill clients in Great Britain Pounds (GBP). You could set up a conversation rate for GBP of 0.680000. This means that every dollar that you would normally bill in USD will be converted into 0.68 GBP.
Assign Invoice No. To Drafts: When enabled, DRAFT invoices will be allocated an Invoice Number. When disabled they will show as 'DRAFT' until approved.
This is for Actionstep users that have upgraded their billing systems to EBM from the classic billing system. You can set the date of the migration as a cutoff date to prevent historical billing items from being billed out in EBM.