I do some admin which includes invoicing and my client is currently working on a fencing contract. The agreement is that he is paid every 4 weeks based on meterage but to ease cash flow he and his subbies are paid weekly based on hours worked.
eg 4 week job based on meterage will come to (say) £10k but he is paid £2k each week (invoiced) and then a final invoice to make up the difference. Part of the job includes clearing the land before they can erect the fencing for which they are paid a fixed daily rate. Lets say that is 2 of the 4 men spending 5 days on clearance totalling £1k.
So is the final invoice £2k plus £1k clearance or is it 2k because the land clearance is part of the hours worked, which has been paid for on the weekly invoice?
I'm almost certain that it's 3k but I keep talking myself into it being 2k.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
eg 4 week job based on meterage will come to (say) £10k but he is paid £2k each week (invoiced) and then a final invoice to make up the difference. Part of the jobincludes clearing the land before they can erect the fencing for which they are paid a fixed daily rate. Lets say that is 2 of the 4 men spending 5 days on clearance totalling £1k.
Hi John,
So is the land clearance an extra to the meterage price?
If it is extra I would show on the final Invoice the total meterage price for erection and the price for the clearance minus any interim payments so in what you describe it would be
Total meterage £10,000 + extra clearance costs £1,000 = £11,000 - interim payments £8,000 = Outstanding amount £3,000
If the clearance is included in the meterage price then only £2,000 to pay
Did your client not provide a quote for the job which explained the pricing method, I have had it before when a job was agreed on a price just for the main contractor to say that certain parts should have been included in the price so will not being paying for extras, so always best to have a written quote to fall back on in a dispute
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Doug
These are only my opinions of how I see things and therefore should not be taken as advice
No, the land clearance is not part of the meterage price, and I drew the same conclusion, but then confusing myself because the interim payments are connected to the hours worked rather than an advance and the clearance is part of the hours worked.
I need to forget what the payments are for and just treat them as advance payments against the total job.
The land clearance wasn't part of the contract initially, and a day rate was agreed after the contract started.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Yep that's exactly what I would do, total of all work minus any payments made
The only other thing some firms may want would be to treat the clearance as a separate job and therefore a different Invoice and different payment, sometimes works out better to do it this way rather than letting all the extras build up and go towards a final Invoice, I always found on bigger jobs this to be the better option as you can keep on top of everything.
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Doug
These are only my opinions of how I see things and therefore should not be taken as advice
Program I use is called Sliq Invoice Plus and it's excellent. You can add as many companies as you want so I use it for me and my client, costs about £50 as a one off payment.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
