Retainage Receivables –
In this video, learn how the Receivables features work in the Retainage (Holdbacks) application by Suite Engine.
*Retainage (Holdbacks) is a tool for Accountants. After watching this playlist, contact Suite Engine to learn how to get started with a free trial.
This video demonstrates the Retainage Receivables app for Microsoft Business Central, which manages retention amounts (also called holdbacks) on sales transactions. The app allows businesses to hold back a percentage of invoice amounts for later release.
Streamlining Retainage Management in Business Central: A Complete Guide to Receivables Retention
For businesses in construction, manufacturing, and other industries where project-based work is common, managing retainage (also known as retention or holdbacks) is a critical but often complex process. Microsoft Business Central users now have a powerful solution with the Retainage Receivables app, which seamlessly integrates retention management into your existing workflow.
What is Retainage and Why Does it Matter?
Retainage is a common business practice where a percentage of an invoice amount is held back by the customer until project completion, warranty periods expire, or other contractual obligations are met. This practice protects customers while ensuring contractors and suppliers have incentive to complete work satisfactorily.
Traditionally, managing retainage has been a manual, error-prone process involving spreadsheets and complex tracking systems. The Business Central Retainage Receivables app changes this by automating the entire process within your familiar ERP environment.
Key Benefits of the Retainage Receivables App
Seamless Integration
The app works directly within Business Central’s standard processes, requiring minimal setup. You simply configure retainage percentages and timeframes at the customer level, and the system handles the rest.
Intelligent Tax Handling
One of the app’s standout features is its sophisticated tax management. The system automatically calculates retainage amounts based on net values (after discounts) and splits retention by tax groups. Whether you’re working with taxable bicycles or non-taxable components, the app ensures accurate calculations across different tax treatments.
Comprehensive Reporting
The app provides multiple reporting views to give you complete visibility into your retainage positions:
- Customer Retainage Entries: Quick overview of retained amounts by customer
- Enhanced Customer Ledger Entries: Standard Business Central entries with retainage amounts displayed
- Aged Retainage Receivables Report: Similar to aged accounts receivable, but focused on retention amounts
- Detailed Entries: Granular view is perfect for creating accrual journals
How the Process Works
The retainage workflow is straightforward and follows Business Central’s standard posting procedures:
- Create Your Invoice: Build your sales invoice normally with multiple lines and different tax treatments
- Calculate Retainage: The system automatically calculates retention amounts based on your customer setup or invoice-specific overrides
- Post the Transaction: Business Central posts the invoice less the retained amount
- Track and Report: Monitor outstanding retainage through comprehensive reporting
- Release When Ready: Use the release function to create offsetting entries when it’s time to collect the held amounts
Advanced Features for Complex Scenarios
Project-Based Tracking
For businesses using Business Central’s project functionality, the app maintains separate retainage tracking by project. This ensures you can clearly identify which retention amounts relate to specific projects when releasing funds.
Flexible Release Options
The release process is highly flexible. You can release individual invoices separately or group multiple invoices by customer. The app even includes application and unapplication functionality, so corrections are possible if mistakes occur.
Global Tax Compliance
The app works seamlessly with Business Central’s tax systems across different regions, including European VAT rules, US tax structures, and Canadian tax requirements.
Real-World Impact
Consider a construction company invoicing for bicycles, accessories, and parts with different tax treatments. Previously, calculating the correct retainage amounts manually while accounting for line discounts and tax splits would be time-consuming and error-prone. With the Retainage Receivables app, this complex calculation happens automatically, ensuring accuracy while saving valuable time.
The app’s reporting capabilities also transform how businesses manage cash flow. Instead of hunting through spreadsheets to determine outstanding retainage amounts, financial teams can quickly generate aged reports and detailed entries for accrual purposes.
Getting Started
Implementation is straightforward for any Business Central user familiar with basic setup tables. The app requires minimal configuration in customer posting setup and sales & receivables setup. Most businesses can be up and running quickly with their existing processes enhanced rather than replaced.
The Retainage Receivables app represents a significant step forward in Business Central’s project and receivables management capabilities. By automating complex retention calculations and providing comprehensive reporting, it eliminates manual errors while giving businesses complete visibility into their retainage positions.
For companies dealing with retainage regularly, this app doesn’t just save time—it transforms a traditionally complex process into a seamless part of your Business Central workflow. Whether you’re managing simple retention agreements or complex multi-project scenarios with varying tax treatments, the app provides the tools you need to stay organized and compliant.
Ready to streamline your retainage management? The Retainage Receivables app is available through Microsoft AppSource, with a companion Retainage Payables app for managing the other side of retention transactions.
- Learn more about Suite Engine’s Retainage applications.
- Get the App on Microsoft AppSource today, or request a personalized demo!
