Table of Contents
Updated by Julianna Durie
Read Time: 6 mins
Sonar should not and does not replace your accounting software. All accounting functions, such as payroll, depreciation, expense tracking, etc., should be tracked within your accounting software. Instead, Sonar handles the customers at an individual level, while being used to represent one or more groups of customers within your accounting program.
Sonar keeps track of transactions with all of your customers, similar to a cash register used in a store. During the day sales can be made, payments can be processed, and you can even cancel a transaction if a mistake is made - all the while Sonar is there on the job, recording the flow of money and tracking the results for each one of your customers. At the end of the set accounting period in Sonar, the cash register is closed. At this point, the day's transactions are locked down so that no further changes can be made, unless they follow proper accounting practices. For example, once the accounting period is closed an invoice cannot be canceled anymore, therefore a credit must be created and then applied to the invoice instead. This practice allows accounting staff to create reports today for yesterday’s transactions while being confident that the numbers will not change if the same report is run a year from now.
Legacy version of Sonar (V1): Sonar Billing, Reporting & Your Accounting Software: V1
Current version of Sonar (V2): Sonar Billing, Reporting & Your Accounting Software: V2
Accounts & Transactions
The chart of accounts lists the accounts that are available for recording transactions. In keeping with the double-entry system of accounting, a minimum of two accounts is needed for every transaction - at least one account is debited and at least one account is credited. Occasionally, a transaction is manually entered into Sonar, such as a cash or check payment, or the one-time sale of labor or equipment. You are responsible for handling one of the entries and Sonar handles the other entry automatically in the background. However, since most transactions happen in Sonar without the work or the risk of humans being involved, we cannot follow the flow on either of the two accounts.
Below, you can see how transactions add and subtract from accounts for every action that occurs within Sonar. With this information, you can create or request custom reports that fit your unique business requirements
Expense accounts are debited and have debit balances
Revenue accounts are credited and have credit balances
Asset accounts normally have debit balances :
Liability accounts normally have credit balances:
Invoices, Payments & the Flow Within Sonar
Below is a step by step example of how an invoice and payment move through Sonar, starting with the initial charge created on the customer's account through to viewing it in Sonar reports.
- A technician performs an install for a customer account, therefore activating the account with a recurring monthly service and generating a new invoice.
Sonar creates a charge. The debit is created and is considered Uninvoiced Revenue.
- Sonar creates an invoice. The debit has now moved from Uninvoiced Revenue into Invoiced Revenue.
- If we navigate to the Invoiced Revenue Report, filter by Date, and click "Run" to run the report, we can now see John Smith's invoice and the corresponding GL Code.It is important to be mindful of the time zone being displayed and if it is different than someone else viewing the reports, as this can change the data (similar to when automated invoices are generated).
- By navigating to the Invoiced Revenue by GL Code report, which can be found below the Invoiced Revenue Report, scrolling to the bottom we can see our invoiced revenue from John Smith appearing by the GL Code that we saw in the step above.In the legacy version of Sonar, the "Invoiced Revenue by GL Code" report is referred to as the "Transaction by GL Code" report.It is recommended you assign a general ledger code that is the same in Sonar and in your accounting software.
- If the customer was to go delinquent, we could run the Delinquency Report. In the image below, the report was generated on July 10th and the invoice was due on June 24th.
Payments Under the Customer Account
Continuing from the example we looked at above, below we can see the process of taking a customer payment and applying an added credit to the invoice.
- Under the Transaction History of the Billing tab for the customer account, we can see that on July 10th a $400.00 cash payment was taken for this customer, John Smith. In addition to the payment, $10.00 in the form of an adjustment was also put on the account, which went into Available Credits.
- This credit on the customer account can now be applied to a specific invoice for the customer, as seen below.
- Now, if we navigate to the Payments Report, filter by Date, and click "Run" to run the report, we can now see the 3 totals separated by type of payment.It is important to be mindful of the time zone being displayed and if it is different than someone else viewing the reports, as this can change the data (similar to when automated invoices are generated).Each color from the report is explained below:
- Blue = the total payment received
- Pink = the payment applied (the money used to pay an invoice)
- Green = the unearned revenue (the money is on the account but has not been used to pay anything on the account yet)Within the legacy version of Sonar, "Unearned Revenue" is referred to as "Remaining Funds" or "Available Funds"
- Lastly, now if we were to navigate to the "Adjustments, Discounts and Overrides" report, we can see the $10.00 adjustment credit that was made on the customer account for John Smith. In the image below, we can see the total adjustments made within a specified time period, and the left column shows us all of the credit adjustments.
Tracking Where the Money Goes
To help illustrate how the money moves through Sonar, below is a comprehensive spreadsheet that highlights various commonly occurring scenarios and where the money goes to for each situation.