Invoicing for a pass-thru/fiduciary? Insurance agency accounting

Support User
1

Tldr; how to setup an invoice for a fudiciary/pass through entity? For a sales invoice, the credit side is split between a revenue account and a liability account (payable out of a trust account).

As an insurance agent in the US, I bill customers on the full insurance premium amount on their policy, deposit their payment in a trust account (separate from my own company’s operating account), then take a portion of this as my revenue and forward the remainder to the insurance company on a monthly basis. This is known in the US as “agency billed”, vs “direct billed” where the customer pays the insurance company the full amount and I get a commission check after the sale.

I’m a fiduciary entity for a portion of the total amount billed in the sale, which cannot get recorded as revenue, and the corresponding amount sent to the insurance company does not get recorded as an expense. (Indeed, for insurance agents there isn’t even an expense account “Premium Payments to Companies”.)

So that said, how would I setup the initial transaction in Tryton to look like this:

Customer Invoiced:
AR - Premium due to Agency: $1,000 (debit)
AP - Premium due to Company: $900 (credit)
Revenue - Agency Commission: $100 (credit)

At the moment I think I’ve followed the initial account & product setup steps properly, but my first invoice has created this:

Customer Invoiced:
AR - Premium due to Agency: $1,000 (debit)
Revenue - Agency Commission: $1,000 (credit)

Any ideas on how to set this up? How can I change the default move that gets triggered on an invoice?

2

Follow-up: some supporting documentation, describing what I’m trying to do with Tryton…

3

You may be interested on the commission module to automatically generating the commissions (in your case incomming commissions by declaring yourself a principal of the insurance) based on a set of rules.

When invoicing the commissions you will get a invoice that generates the revenue amount for the commission with the receivable account as counterpart. This way, at some fixes period you will generate an invoice to the insurance agency with all the revenue of a period.

I guess you should use the commission module as starting point to be able to compute the right revenue amount.

There is a method on the invoice model to create the invoice. You can override it on a custom module to customize it based on your needs.