About accounts receivable retention

Many job contracts include retention. When you create a receivable invoice, Sage 100 Contractor withholds retention at the rate specified in the job file. If you do not set up a default rate in the job file, you can withhold a flat amount on each individual invoice.

Posting an invoice declares the gross amount of the invoice as income. However, a percentage of the gross amount is withheld as retention, so the client is actually billed for the net amount (gross invoice amount – retention = net invoice amount). Therefore, retention is already declared as income but is not yet due. Consequently, Sage 100 Contractor does not include retention in the invoice aging, and does not apply finance charges to it.

When you are ready to bill the client for retention, it is not necessary to create a new invoice. The retention has already been declared income, so you only need to release the retention that has been withheld. You can release retention on each invoice individually, or you can release the retention for the entire job at one time. Having released the retention, you can then send the client a statement reflecting the amount that is due your company.