Billing Reimbursable Items

When billing reimbursable expenses there is a chance that a client, from time to time, might dispute one of your reimbursable expenses and hold up paying the invoice until the dispute is resolved.

A client of ours once had an invoice where the design fees represented about $60,000 on the invoice and the reimbursable expanses represent about a few hundred dollars. But because one of the reimbursable expenses was disputed, the entire invoice was not paid for several months until the dispute was resolved.

Had this firm submitted two separate invoices one for the design and one for the reimbursable expenses, then the design fees could have been paid more promptly and only the invoices with the reimbursable expenses would have been delayed.

This depends on you client and what the rules and operating procedures are. But some clients won’t pay any part of an invoice if a portion of it is in dispute.

So, if that’s the case, you may want to separate your billings into two invoices:

  1. Fees that most likely will not be disputed
  2. Reimbursable or other items that could become disputed

Hopefully, you will not have to deal with disputed invoices and will have happy cash flows.