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This article applies to:

  • Product: Legal Tracker
  • Subject: Billing,Invoices
  • Audiences: Company

Reviewing proforma invoices

Proforma invoices route through the matter's existing approval route. Reviewers can approve, adjust, reject, or dispute them, similar to reviewing tax invoices.
Proforma invoices may be approved, rejected, or disputed, even if matter profile information is incomplete. While the matter profile must be complete for a tax invoice to be approved, this requirement does not prevent company approvers from being able to process proforma invoices.
Email notifications are sent to law firms advising of rejected or disputed proforma invoices.
note
  • The email notification can be customized.
  • The word
    Proforma
     appears directly on the proforma invoice to clearly distinguish it from a tax invoice.

Approve proforma invoices

The proforma invoice must be approved by the company before a law firm can submit a tax invoice. Approval of a proforma invoice can't be reversed, but the approval can be undone if the tax invoice hasn’t been posted/approved for the invoice.
  1. In the left navigation, select
    Financial
    Proforma invoice review
    .
  2. Under the
    Invoice
     column, scroll through the list to find the invoice you want to work with and select to open it. A green square next to the invoice indicates it is ready to be approved.
  3. Select the
    Approve
     button on the invoice.

Audit flags

Indicator
Explanation
Red dot
Audit exceptions must be addressed before the invoice can be finally approved.
Yellow triangle
Audit exceptions were addressed by a previous reviewer or by the system, which permits auto-reductions and auto-rejections to rates. You can accept or reject them.
Keywords indicate that fee or expense line items may need review for possible adjustment.
Gray diamond
An invoice is not auditable because it is not in LEDES format or because the matter is not set up for over-budget audits (either no budget is required, or no audit is required).
Green square
The invoice passed all audits and is ready to be approved.

Proforma budget audit

important
A Tracker Coordinator must turn on the feature flag before it is available for use by marking the
Enable Proforma Invoice Budget Audit
 checkbox.
When turned on, the budget audit runs at the proforma stage instead of waiting until the tax invoice is posted. This surfaces budget issues so they can be caught and resolved before the firm completes the work and before the proforma is approved.
Proforma exceeds budget:
  1. The firm submits a proforma invoice.
  2. If a proforma would cause the matter to exceed its budget, a budget alert is triggered on the proforma the same way it currently works for standard invoices.
  3. The company can resolve the alert using existing, familiar options:
    • Ignore the audit and proceed
    • Approve, or Save and Approve
    • Reduce the amount to bring it within budget (this automatically creates an invoice-level adjustment)
  4. Once the audit is resolved, the proforma is approved.
  5. The firm then posts the corresponding tax invoice, which must match the approved (and possibly reduced) proforma amount.
  6. Because the check already occurred at the proforma stage, the tax invoice posts without triggering a separate budget rejection.
Tax exclusion:
  1. If a matter type template has tax excluded from budget calculations, that setting transfers over automatically to proforma invoices.
  2. A proforma whose total exceeds the budget only because of tax won’t trigger a budget audit.
  3. The budget information will correctly reflect the tax amount as excluded from spend.
Turn off the audit for proformas specifically:
  1. At the matter type template level, a checkbox lets you turn off the budget audit for proforma invoices only.
  2. When this is turned on, a proforma can be posted over budget without triggering an audit at that stage.
  3. The check is not skipped entirely, it moves downstream, so when the corresponding tax invoice is posted at the same amount, the budget alert appears there instead.
Control who can reduce a proforma's budget violation:
  1. In
    Miscellaneous Financial Options
    , the
    Enable Proforma invoices modifications
     field controls whether users can reduce a proforma's budget violation.
    • If you select
      Yes
      : a user can reduce the violation and approve the proforma in that adjusted state.
    • If you select
      No
      : the reduce option isn't available — the user instead encounters a message explaining why, with a direct link to
      Miscellaneous Financial Options
       so they can turn it on if needed.
  2. This replaces the previous behavior, where attempting to reduce the violation while the setting was off simply produced an error with no clear next step.

Dispute a proforma invoice

Disputing an invoice follows the same process as rejecting an invoice, except that the law firm is required to respond to the reviewer comments when resubmitting the invoice. The dispute process is an important option if your company wants to comply with EU VAT recovery rules, which state that an invoice must be unaltered by the recipient in order for tax to be recovered.
The law firm can then respond to the comments and resubmit the invoice, with corrections if necessary.
  1. In the left navigation, select
    Financial
    Proforma invoice review
    .
  2. Under the
    Invoice
     column, select to open the invoice you wan to dispute.
  3. On the toolbar, select
    Dispute
    .
  4. On the window that opens, type an explanation in the
    Firm Comment
    box (Required). The law firm will encounter this comment after the invoice is finally approved, rejected, or disputed. You can also add an optional comment in the
    Internal comment
     section.
  5. Select
    Save
    .

Reduce a proforma invoice

If you reduce an invoice, the law firm receives an email notification. Once your company approves the reduced, the law firm can submit a tax invoice for the reduced amount.
  1. In the left navigation, select
    Financial
    Proforma invoice review
    .
  2. Under the
    Invoice
     column, select to open the invoice you wan to dispute.
  3. On the toolbar, select
    Reduce
    .
  4. On the window that opens, type an explanation in the
    Firm Comment
    box (Required). The law firm will encounter this comment after the invoice is finally approved, rejected, or disputed. You can also add an optional comment in the
    Internal comment
     section.
  5. Select
    Save
    .

Reject a proforma invoice

Rejection of a proforma invoice puts the proforma invoice into a terminal state. The law firm user can review the comments that accompany the rejection, but they can't resubmit the proforma. Instead, they must submit a new proforma invoice.
  1. In the left navigation, select
    Financial
    Proforma invoice review
    .
  2. Under the
    Invoice
     column, select to open the invoice you wan to dispute.
  3. On the toolbar, select
    Reject
    .
  4. In the dropdown on the window that opens, select a reason from the list. You can also add an optional comment in the
    Internal comment
     section.
  5. Select
    Save
    .

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