How it runs for staffing and recruiting agencies
A perm fee arrives short because the client deducted a replacement credit. Your dedicated specialist applies each receipt to the right invoices in QuickBooks Online the day it arrives, records fees and short-pays separately, and clears the unapplied-cash list every week.
What is cash application?
Cash application means matching money received from customers to the invoices it pays and recording that in the accounting system. It covers bank receipts, checks, lockbox files, card payouts and remittance advices, including partial payments, deductions and payments with no reference. Done well, the aging is accurate and no customer is chased for an invoice they already paid.
What we handle for staffing and recruiting agencies
- Remittances matched by worker name and week-ending date to the open invoices
- VMS payments applied at gross with the platform fee posted separately
- Funder advances and reserve releases applied against the assigned invoices
- Short-pays and replacement credits logged against the original invoice with a reason
- Unapplied cash cleared weekly, with unidentified receipts sent to the office
The KPI that matters here
Client payments are applied to the correct invoices within one business day of receipt.
Staffing compliance notes
Multi-state payroll tax
Each state where temps work needs withholding and unemployment registrations, and several states have local income taxes on top. We post payroll by work state, reconcile the liability accounts to the returns your payroll provider files, and flag new work states before the first assignment starts. Your provider files; we keep the books and the reconciliations that prove the filings.
Worker classification
Whether a placed worker is an employee or a contractor depends on control, integration and the applicable federal or state test, and the wrong answer is expensive. We keep W-2 and 1099 spend separate, hold the classification reason with the vendor record, and report 1099 volume monthly so you and your counsel can review it. We give no legal advice on the test itself.
Payroll funding and factoring
Agencies that use a funding partner receive advances on invoices, pay fees, and get reserves released when clients pay. Each of those movements is reconciled to the invoice it relates to and to the bank, so the balance sheet shows the true amount owed to the funder. The funding agreement's reporting requirements are prepared from the reconciled books.
Timesheet-to-invoice controls
The invoice to a client should be provable from approved timesheets, and the payroll should be provable from the same sheets. We keep the three-way match every week, hold client approvals with the invoice, and log corrections with a reason so disputes months later can be settled from the record.
Staffing software we work in
More for staffing and recruiting agencies
Other services for staffing
Frequently asked questions
How do you apply a payment that references workers instead of invoices?
By matching the worker name and week-ending date on the remittance to the invoice lines, since each invoice from Bullhorn carries both. The specialist applies the payment across all the invoices it covers and lists anything on the remittance that does not match an open invoice. That list goes to the office within a day.
How are funder advances and reserve releases applied?
The advance is posted to the funding account against the assigned invoice, not as a customer payment. When the client pays, the receipt clears the invoice, and the reserve release less fees is posted to the funding account. The invoice, the funder's schedule and the bank then agree, and the fee is visible as a cost of funding.
What do you do with a perm fee paid short?
The short-pay is logged against the perm invoice with the client's reason, usually a replacement credit or a disputed start date. The AR specialist confirms the replacement terms on the invoice, and the difference is either collected or credited with your approval. Short-pays on perm fees are reported monthly so patterns by client are visible.
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