Service Company and Finance-Only Use
A consultancy with twelve staff bills each client a monthly retainer, pays rent, salaries and a few dozen supplier bills a month, and wants to see profit per client. A foreign-owned branch only needs a statutory ledger kept in the local currency and closed every month. Neither of them has a warehouse, an item in stock or a delivery. For these companies Nama is the accounting system first: services are billed on sales invoices, spending goes through miscellaneous invoices and vouchers, and a dimension plays the part of the job register.
Who this fits
- Consultancies, law and audit firms, facility management, freight and logistics agents, schools and training centres, clinics, and foreign-owned firms that keep their statutory books in Nama. Across Nama installations, about 1 in 4 companies move no stock at all.
- Leaving out real estate and contracting companies, which also keep no stock but have their own pages, it is about 1 in 6. About half of those invoice their services through sales invoices; the rest use Nama for the books only.
- These companies often combine this page with Multi-Company Group, when a holding company or a set of sister firms share one database. Contractors and developers keep their head-office books this way too, next to Contracting Company or Real Estate Developer.
What you need
Required licences
accounting, accounting-banks; supplychain-sales for service invoices; humanresource-payroll for payroll; basic-tax-e-invoice where electronic invoicing applies; ecpa for time-based project billing.
- Accounting: the chart of accounts, journal entries, vouchers, miscellaneous invoices, notes, banks and period control.
- Supply Chain: only the sales invoice and the service items it sells.
- Human Resources: payroll, for about 1 in 5 of these companies.
- Project Management: hours, tasks and project invoices, for firms that bill time.
The document flow
Follow one month at the consultancy:
- The client is billed. Each retainer goes on a Sales Invoice whose lines are service items: items that are sold but never stocked, so the invoice issues nothing from a warehouse. Firms that send an estimate first issue a Proforma Sales Invoice and build the invoice from it. Every invoice carries the client's job code in its analysis set.
- The client pays. A Receipt Voucher receives the money and settles the invoice. Where cheques are customary, the voucher's financial-papers tab records them.
- Suppliers bill. Rent, software subscriptions, the audit fee and office supplies go on a Miscellaneous Invoice, whose lines pick a Purchase Element that carries the expense account. A Payment Voucher pays it.
- Petty spending. Staff raise a Payment Request for a taxi, a courier or a client lunch; the cashier accepts it and generates the Payment Voucher.
- Corrections without cash. A Credit Note reduces what a client owes, and a Debit Note adds a charge, both without touching the cash box.
- Treasury and month end. A Bank Transfer moves money between bank accounts, an Exchange Rate Update records the currency differences on foreign-currency balances, and the accountant posts accruals and adjustments as Journal Entries. Then the period is closed so nobody posts into it by mistake.
Setting it up, in order
- Chart of accounts and dimensions. Build the chart of accounts and decide what each dimension means here, because the dimensions carry the management reporting when there is no stock.
- Service items. Create each service as an item of the service type. See understanding items.
- Purchase elements for expenses. One per kind of expense, each with its default account, so every miscellaneous invoice line books to the right place. See miscellaneous purchasing.
- Banks and cash boxes. Set up the banks and bank accounts, and the cheque books if cheques are used.
- The job register. Create an analysis set (or a sector) per job, client or case, and make it required on the documents that should carry it.
- Periods and period locking. Open the fiscal year and decide who may still post into a closed period. See fiscal period control.
Settings and tools most companies use
- Journal entries. About 9 in 10 of these companies post manual journal entries regularly. See journal entries.
- Miscellaneous invoices. About half record supplier bills on miscellaneous invoices. See miscellaneous purchasing.
- Debit and credit notes. About 1 in 4 use debit notes. See credit and debit notes.
- An analysis set as the register. About 1 in 5 keep an analysis set per job, client or case. See dimensions.
- Approvals. Approvals and heavy customisation are less common here than in any other scenario: about 2 in 5 route documents through approvals, and about 1 in 5 customise heavily. See approvals.
Variations
Books only. Some companies never issue a sales invoice in Nama: revenue arrives from another system or as monthly totals on journal entries, and Nama keeps the ledger, the bank and the statutory reports. The flow is then only steps 3 to 6.
Owner-run firms and partnerships. Where the profit is shared between partners, record each partner's shares and split the period's profit with the profits distribution document. See partner shares and profit distribution.
Billing time. Engineering offices and consultancies that bill by the hour or by phase use the Project Management module, which records who worked on what and turns recorded hours into project invoices. It is used by few companies, but it fits firms whose deliverable is professional time. See the Project Management overview.
Facility services. Companies that deliver cleaning, security or maintenance to sites rather than to machines can run their contracts and work orders on the service documents of the CRM module. See services or machines.
Decisions to make before go-live
Service or stock, once and for all. Service items hold no quantity, and an item's type cannot switch between service and stock after it has been used in a stock document. The save is refused with:
You can not change item type from Service to Stock or vice-versa after using it in Stock Issue, Receipt, or Transfer — «لا يمكنك تغيير نوع الصنف من خدمة إلى مخزني أو العكس بعد استخدامه في سند الصرف , التوريد المخزني أو التحويل المخزني»
Create each item with the right type from the start.
Which job register. An analysis set (the usual choice), a sector, or the Project Management module when hours must be recorded and billed.
Miscellaneous invoice or journal entry for expenses. The miscellaneous invoice keeps the supplier's balance, its tax and its payments together; a journal entry suits only internal accruals and adjustments.
Partners. For owner-run firms, decide up front whether each owner is kept as a Partner record with its own capital and current account, and whether the profit split is done in Nama.
Period closing. Decide how soon after month end the period is closed, and who may post into a closed period.