Professional services

How work becomes money

An hour, a ticket, an expense or a fee becomes a charge; an agreement decides what happens to it; and what is left is the margin.

Every professional services tool has to answer four questions, and most answer the first two and guess at the rest: what was done, what was invoiced, what was it worth, and what did it cost. Ergira answers all four from one record, because the hours, the agreement, the invoice and the payroll are in the same database.

1
Work becomes a charge
An hour recorded against a work item, a ticket or nothing at all becomes a charge with a client, a quantity and a value. So does an expense, a fixed fee, an incident and an agreed adjustment. See charges.
2
The agreement decides what happens to it
A contract holds allowances — hours, money on account, tickets, units, or unlimited — and the charge draws one down, is included in a fee, is absorbed above a cap, or is billed. See contracts and allowances.
3
What is left reaches an invoice
Anything still pending is priced onto a draft through the ordinary billing run, and from there it is an ordinary invoice.
4
And the margin falls out of the same record
What it was worth, what it cost, and what the arrangement gave away — see delivery and margin and what an hour costs.

The commonest arrangement bills none of it

Most companies — ours and most of our customers' — charge a subscription or a flat monthly fee with no correlation to any hour or ticket. A tool that assumed every hour becomes an invoice line would be wrong for the majority case, which is why value and invoicing are recorded separately throughout.

What is here

[Charges](/docs/psa-charges): One record for anything a client could be charged for, carrying what it was worth and, separately, what happened to it commercially.
[Contracts and allowances](/docs/psa-contracts): Block hours, retainers, included tickets, per-seat units and unlimited support — one mechanism, not five contract types.
[Expenses](/docs/psa-expenses): What was spent, who is owed it back, and what a client is charged for it.
[Delivery and margin](/docs/delivery): Delivered, charged and cost — and two margins, because on a flat fee they are not the same number.
[What an hour costs](/docs/invoicing-cost): Derived from what somebody is paid and the hours they are available, rather than typed once and left to go stale.
[Planning and utilisation](/docs/psa-capacity): Whether you can take a job in October, and how much of the time you paid for reached a client.
[Revenue recognition](/docs/psa-revenue): A fixed fee earns out as it is delivered, and the entries post to a real ledger.