Orion Interface

Orion’s General Ledger is simply the program that collects transactions from each of the other modules for reporting purposes. No transactions are automatically transferred to the General Ledger. The transactions are created and stored in the individual modules until you actually transfer them to the General Ledger. Even then, they are brought in as unposted transactions. This gives you one more opportunity to edit them before posting. The transfer can occur at any time and as often as you wish. The frequency should be determined by your internal accounting procedures. If you run financials frequently throughout the month, you should transfer the transactions several times in the month, maybe even daily. Most firms wait until the end of the month and transfer them all at once. You should evaluate your internal procedures and determine the frequency required to meet your internal procedures.

In addition to the General Ledger transactions created in each module, the Accounts Payable module feeds information into the Billing and Accounts Receivable module. Specifically, any time a Voucher is posted which includes charges that have been distributed to a Client-Matter and entered with a “CA” code, the Client-Matter file is updated with these expenses for billing.

Additionally, trust and retainer transactions can be created in Voucher Entry, and these transactions also update the Client-Matter’s ledger file. Below is a more detailed explanation of these transactions as well as others. Understanding the path each transaction takes will help you maintain accurate balances and ensure you can make adjustments when necessary.

Sample General Ledger Table

For purposes of this explanation, let’s assume your G/L Default Table looks like this:

The remainder of this chapter provides examples that should help you understand how the accounts defined in the General Ledger Table under System Setup are affected by various functions performed in Orion and how the different Orion modules interrelate.

Orion Billing

Each time an invoice is posted or unposted or any type of payment, credit, etc. is posted in the Billing and Accounts Receivable module, a General Ledger transaction is created. Trust and retainer transactions also create General Ledger transactions. Trust and retainer deposits and disbursements (TDP, RDP, TDS and RDS) do not have to be posted. TAP and RAP transactions must be posted before General Ledger transactions are created.

Invoicing

When an invoice for fees ($1,200.00), expenses ($5.00) and client advances ($150.00) is created and posted, the following transactions are created:

These transactions will print on the AR to GL Transfer Report and the date of the transaction will be the date of the invoice.

Payments, Credits, Write Offs, Etc.

1.   Payments (PMT)

When a payment ($1,355.00 for Invoice 12345 as shown above) is received, entered, applied and posted, the following transactions are created:

2.   Retainer Applied as Payment (RAP)

When paying an invoice from available “Retainer” funds, a Retainer Applied as Payment (RAP) is entered through the AR Entry Program and the client Trust/Retainer account is automatically updated. The updated amount is immediately reflected in all Client-Matter screens and reports in the Billing and Accounts Receivable module. The applicable General Ledger transactions, however, are not created until the RAP is applied to the outstanding invoice and posted. Once applied and posted, the following transactions are created:

Note:  If the TAP was created through the Accounts Payable module, the transactions hitting the Client Trust Liability and Trust Bank Account are not created upon posting the TAP. Instead, they are created by the Accounts Payable Module.

3.   Trust Applied as Payment (TAP)

When paying an invoice from available “Trust” funds, a Trust Applied as Payment (TAP) is entered through the AR Entry Program and the client Trust/Retainer account is automatically updated. The updated amount is immediately reflected  in all Client-Matter screens and reports in the Billing and Accounts Receivable module. The applicable General Ledger transactions, however, are not created until the TAP is applied to the outstanding invoice and posted. Once applied and posted, the following transactions are created:

4.   Credits (CR) and Write Offs (WO)

Occasionally, an attorney will decide to credit or write off a client’s outstanding accounts receivable balance. Credit and Write Off entries are made through the AR Entry Program using a CR (credit) or WO (write off) code. (For information purposes, we will credit all of Invoice 12345). Credit and Write Off transactions are treated in the same manner as payment (PMT) transactions, RAPs and TAPs. When a Credit or Write Off is entered, applied and posted, the following transactions are created:

Retainer Deposit (RDP)

Most firms consider a “Retainer” to be an advance payment for services rendered. In other words, the “Retainer” is deposited directly into the operating account as income to the firm. Some firms consider this as a non-refundable deposit while others agree to bill against it. Occasionally, a client will overpay an invoice or may pay the same invoice twice. This would be treated as a “Retainer Deposit”.

When funds are received that are considered to be a “Retainer”, the transaction is first entered as a Retainer Deposit (RDP) through the AR Entry Program. The Client-Matter Retainer account is automatically updated. The updated amount is immediately reflected on all Client- Matter screens and reports in the Billing and Accounts Receivable module. The applicable General Ledger transactions are immediately created as follows:

Trust Account Deposit (TDP)

When a new Client-Matter is set up the system asks for a Trust Account number. This is so the system will know what account to use when trust transactions are entered. When funds are received that are to be deposited into a Trust account, the transaction is first entered as a Trust Deposit (TDP) through the AR Entry Program. The Client-Matter Trust account is automatically updated. The updated amount is immediately reflected on all Client-Matter screens and reports in the Billing and Accounts Receivable module. The applicable General Ledger transactions are immediately created as follows:

Trust Account Disbursement (TDS)

When trust account disbursements (if you pay something on behalf of the client out of the trust account) are made, the Client Trust account is automatically updated. The updated amount is immediately reflected in all Client-Matter screens and reports in the Billing and Accounts Receivable module. The applicable General Ledger transactions are immediately created as follows:

Retainer Disbursement (RDS)

When retainer account disbursements are made, the Client Retainer account is automatically updated. The updated amount is immediately reflected in all Client-Matter screens and reports in the Billing and Accounts Receivable module. The applicable General Ledger transactions are immediately created as follows:

You should be careful when creating Retainer Disbursements because your cash account will be affected. If you are transferring a retainer amount from one Client-Matter to another, it is a good idea to fully describe the transaction when you enter the Retainer Disbursement. Since ORION does not have a way to create a “Retainer Transfer,” you must first enter a Retainer Disbursement (RDS) and then a Retainer Deposit (RDP). A retainer transfer will basically be a “wash” in the General Ledger accounts. For example, if Client 145 - Matter 1 has a retainer balance of $500.00 and you wish to transfer $250.00 to Client 145 - Matter 2, the following General Ledger transactions will be created:

RDS CLIENT 145 - MATTER 1

RDP CLIENT 145 - MATTER 2

As you can see with the above transactions, the $250.00 is taken out of the Operating Account with the RDS and immediately put back in with the RDP.

Accounts Payable - Cash Basis

In cash basis systems, no General Ledger transactions are created until a check is written. At that time, cash is credited and the account or accounts listed in the distribution of the Voucher are debited. If the check is voided and the transactions created for the original check have been transferred to the General Ledger, reversing General Ledger transactions are created. If the original transactions have not yet been transferred to the General Ledger, they are just deleted.

If a “CA” code is used in the Voucher's distribution, a Client Advance transaction is created in the Billing and Accounts Receivable module for the Client-Matter associated with the code as soon as the Voucher is posted. If this Voucher is voided, the system deletes the Client Advance transaction from the Billing and Accounts Receivable module if it has not yet been billed to the Client. If it has already been billed, a credit (CR) transaction is created in the Billing and Accounts Receivable module which must then be applied and posted to an outstanding invoice.

Trust and retainer transactions can also be entered through the Voucher Entry program. The following details the transactions created for each type of entry.

Trust Disbursement (TDS)

If a trust disbursement is made through the Accounts Payable module you must use the Trust Account Bank Code in the Voucher Entry Program. You must also enter the Client-Matter number and choose the TDS code rather than a CA code. Upon posting the Voucher, the Client-Matter Trust account balance is reduced by the amount of the TDS. The Trust ledger will display an entry showing the date, Voucher number and the amount of the Voucher. When the check is written, the following transactions are created: