Adjustment or Credit in a LEDES 1998B File/ Invoice Level Discount
There are two basic options for creating an invoice level discount. It really depends on what the client wants to see on the invoice.
Does the client want to see the discount distributed into the fee and expense lines (option 1) OR does the client want to see the discount as a separate line (option 2)? This may be something you need to discuss with your client (and this may vary from client to client).
ADJUSTMENTS for a LEDES98B invoice
Example: a discount of $1000 on an invoice with invoice total of $3000
Option 1: Invoice Adjustment Line (IF/IE)
If a office is using a LEDES file for this process, he or she can simply add an Invoice Adjustment Line (IF or IE) to adjust the Invoice Total by $1000. The IF line (or IE) line will distribute the adjustment among all the F lines (or E lines).
Option 2: Expense line item with discount
Alternatively, he or she could also use a negative line entry (E) as an expense. The E line will make a negative line item (only one line shows the discount).
make sure that any adjustments are reflected in the INVOICE_TOTAL (highlighted in RED)
Download the PDF version here: Adjustments_in_LEDES_files.pdf
Sample LEDES 1998B Adjustment Line Item (IF):
19990225|96542|711|528|2000|19990101|19990131|Retainer Discount|3|IF|1|-1000|-1000|19990131|||||Monthly Service|24-6437381||||DISP-000000
Sample LEDES 1998BIv2 Adjustment Line Item (IF):
19990225|96542G|711|528|2010|19990101|19990131|Retainer Discount|3|IF|1|-300|-300|19990131|||||Monthly Service|24-6437381||||DISP-000000|77654|76-1235|Merten Merger||1180|GBP|||O|||||||||||||||0|0|VAT|0|GBP
More information about adjustments in other LEDES format can be found here.
Note: For LEDES98BIv2, there is a way to allow Tax Adjustments or not. Usually the Tax Adjustments are not allowed on IF lines, however, Collaborati recognizes that some clients use Invoice Level Tax and will allow the tax to be specified for these clients. Contact Collaborati Support for more information.
Notes for Adjustments:
Collaborati allows for multiple IF lines in one invoice.
Collaborati allows for negative Fee line items (or Expense line items). Some clients do not allow negative Fee line items (or Expense line items).