Summary: This tutorial article and video will demonstrate how you can use Association Service Contracts to set auto-approval criteria, board and signature approval overrides for invoices.
In addition to being used to identify preferred vendors for your association, Service Contracts can also be used to automatically code and approve invoices or override board approval and signature approval settings! Let’s go take a look at how we can use Association service contracts to make our task of approving invoices easier.
We start at the Association -> Services page. Click the dropdown arrow for the desired service and either use the + New Contract button to create a new service contract or the Edit button to edit an existing service contract.
We can search for the Service provider from your management company’s global service provider list by typing in the Provider field. The Account number is required in order to use auto-approval criteria for service contracts. This is the account number that your service provider has assigned to you. If your service provider has not assigned you an account number, you can create a new account number unique to this contract.
Important Note: A unique account number for the service provider and association must be used on each service contract in order for automatic approvals to work. When creating account numbers, we advise that the account number you assign be long enough and unique enough to not potentially be recognized in error on another service contract.
The Start date is required, but the end date can be left blank. Setting an end date will cause any automatic contract settings to be cancelled on the date specified.
You can use the description box to enter information about your contract, which can be helpful in referencing contracts you have previously setup. For our first example, we will use the description of Landscaping contract, auto approval if under $500.
Let’s go to the Approvals section, by clicking on that section, to setup our Auto-approval criteria. For this example, the landscaping contract pays a $500 invoice every month, we will set the Amount to $500.
- The Exact Amount method will only apply your auto-approval criteria if the amount of the invoice exactly matches the number listed in the amount field.
- The Less than Amount method will automatically approve invoices less than the amount defined in the Amount field.
- The Within Amount from last invoice method will automatically approve the invoice if it falls within the amount defined in the amount field.
For our example, we will use the Auto Approve Method of “Exact Amount,” because we only want to approve the invoices automatically that exactly match the specified amount. Any invoices received for that account number of a different amount will NOT be automatically approved.
The board approval and signature approval settings will, by default, follow the settings configured on the Association -> Settings page in the AP section. However, Vantaca allows you to override those associations settings, per contract. There are options to: Require Board or Signature Approval, opt for No Board or Signature Approval, or to use Associations Settings.
In our example, this association does not require board or signature approval, so we can simply use the Association Settings here.
Important note: you must have the appropriate securities to edit signature approval settings.
Now, we need to define which GL we want those invoices coded to by going to the GL Detail section.
Click the + New GL Item button to add a new GL, and begin typing to search in the GL Account field to select from the GL accounts setup for this Association. The fund will always default to the operating, but we can override that here if we need to pay this invoice out of Reserves. The Description will be the GL description used for any invoices approved through this service contract. Because our invoice is always $500, we can either set that amount here, or we can just leave the amount column blank. If we want to pay half of this invoice out of one GL and half out of another, we can click to add a +New GL Item, select our other GL and then enter the percentages to be paid out of that invoice total. Let’s use 50-50 for this example. (Note that you can use the scroll bar to navigate to the right of the GL Detail section to edit/ update percentage allocations).
Once our Service Contract has been setup, be sure to click update and save changes. Now that our service contract is setup, We’ll go take a look at how the service contract works!
Association Service Contracts from the Complete Data Entry screen
When an invoice is being coded from the Complete Data entry screen, with the designated association, service provider and account number correctly identified, users select the refresh GL button to automatically populate the service contract information, as we can see here from our example earlier.
Our percentages and GL amounts correctly populated based on our associations service contract. Nice work!
Let’s go back and look at another example on the Association -> Services page. Let’s create a new service for the Electric Utility and then we will click the dropdown to create a +New Contract. We will search to select our test utility provider, enter the account number and a start date for the contract. The description of this contract will be: Auto-approval and board override for utility bills under $100.
Now, to setup our approvals, we click on the approvals section. For the amount, we will use $100 and our Auto Approve method, Less than amount. In this scenario, we want to override board approval/ our board treasurer always wants to pay the bill, and is fine with them being automatically approved if under $100. Therefore, we select the Board approval setting of “No Board Approval.”
Finally, we will setup our GL information by clicking on the GL detail section. We click the + New GL Item button to type and begin searching for our GL in the GL Account field. We will enter a description as well.
Because the utility bills fluctuate, we can leave the Amount column blank and click update to save our changes!