ServiceTitan’s new automated accounting integration features help customers save time, reduce accounting errors, and finally say goodbye to those headache-inducing, batching-posting-exporting days that stress out your accounting team.
As a follow-up to their live demonstration of the new features during Pantheon in October, ServiceTitan accounting product managers Karan Bathija and Gene Jaeger join Jessica Woodruff Smith of AirWorks Solutions to explain how Journal Entries and Touchless Integration help to streamline your accounting workflow.
In the following recap, you’ll learn:
Proper setup of Journal Entries/Auto-Batching and Touchless Integration (for QuickBooks Online and Intacct users)
Tips and best practices
Answers to the most common questions
Enhancing the accounting customer experience
Bathija, a Senior Product Manager, says the ServiceTitan accounting team focused its efforts on enhancing the automated accounting features based on feedback from customers and to help them solve common pain points when integrating ServiceTitan with a separate accounting system.
“Typically, in an integration environment, you'll notice we’ve been duplicating data across platforms from ServiceTitan to your accounting system… where we're taking every object, every detail of every transaction, and trying to get it across two systems,” Bathija says.
But the team questioned whether it was really necessary to duplicate data across platforms.
“Is it something we will leverage, or is it just how things have been done historically?” Bathija says.
And what the team discovered is that most ServiceTitan customers process their invoicing through ServiceTitan, despite having a separate accounting or Enterprise Resource Planning (ERP) system in place.
“Which got us to the conclusion of, why do we need all of that data in your ERP system or your accounting system if you’re specifically not completing those operational workflows in that specific system?” Bathija explains.
To streamline operational workflows, you need to know your accounts receivable, revenue, and other balances to complete your month-end reporting and gain insight from financial reporting and other accounting closed processes. With that in mind, ServiceTitan created a General Ledger (GL) or Journal Entry level, including vendor bills.
Now, you can use Journal Entries to manage accounts receivable, accounts payable, inventory, and payroll as a subledger inside of ServiceTitan.
Touchless Integration, currently only available for QuickBooks Online and Intacct users, automates transaction processing in ServiceTitan and automatically exports the corresponding Journal Entries to your accounting software, eliminating the need to batch, post, and export.
Since the rollout of Journal Entries and Touchless Integration this summer, Bathija says early customer success metrics show:
95% reduction in time to export data
90% reduction in unique export errors for QBO
Jaeger, a Principal Product Manager, says Journal Entries can be used by any ServiceTitan customer, no matter which accounting program they use.
“What we found is that Journal Entries, from an accountant's perspective, are universal. And because Journal Entries are universal, it didn't matter what accounting system you used,” Jaeger explains. “So, manually we've allowed you to group these daily, weekly, or monthly and post those entries over.
“The Touchless piece is now leveraging that Journal Entry data to make it more real-time so there's no manual process, and if you’re using Intacct or Quickbooks Online, we're able to real-time sync this data across platforms,” Jaeger adds. “As changes are being made in one system, they're made at a Journal Entry level in the other system.”
The new accounting features help customers save time, reduce errors, two-way sync between platforms, edit invoices after exporting, and apply or unapply payments as necessary.
Also, by integrating at a Journal Entry level, you can avoid overloading your accounting or ERP system, Bathija says. When companies grow and push more data into their accounting systems, sometimes those systems can’t handle the heavier volume.
“I know people who’ve had to leave Quickbooks Online because they get more than 30,000 customers or something, and they're forced to upgrade to a new accounting system,” says Woodruff Smith, the accounting and process manager at AirWorks Solutions. “With this new Touchless Integration, that will no longer be the case.”
Jaeger says he’s seen ServiceTitan customers go from no memberships to processing 10,000 memberships each month, along with sending 10,000 invoices to potentially 10,000 different customers. These customers quickly max out their limit on these systems or the systems slow down significantly.
“ServiceTitan is built to help you scale your business,” Jaeger says. “Even if your integration is working great, the speed at which we can do it now via a Journal Entry versus just using the batch process is dramatically increased.”
Woodruff Smith appreciates a speedier process for accounting. She no longer has to wait to export the “perfect” invoice because she no longer has to batch-post-and-export, and her team can update invoices when necessary.
“All those updates get pushed to the Journal Entry as well, so you have data in as real-time as possible,” she says.
Journal Entries and Touchless Integration unlock new capabilities
Whether it’s turning purchase orders into bills, tracking inventory received but not yet invoiced, or accounting for work-in-progress jobs that roll from one month to the next, the new features help to automate the month-end accruals typically handled manually by your accountant, Jaeger says. Journal Entries also help recognize membership revenue at whatever cadence you set.
“Things that can't be done at the document level, Journal Entries will be able to unlock in the future as we continue down this journey,” Jaeger says.
When Woodruff Smith started on ServiceTitan nearly seven years ago, she says her previous company had to use QuickBooks Desktop and the batch-post-export process was her only option.
“You would have export errors all the time. Customer names don't match, or vendor names don't match. Or your vendor document number doesn't export over, so you have to go find it in the accounting system and update it. Just all sorts of headaches because you're trying to push over all that nitty-gritty detail,” Woodruff Smith says.
“We've been on the Journal Entry integration now since January, and it just goes,” she adds. “I don't have errors to deal with and all the information gets to my GL. My Profit & Loss matches ServiceTitan to QuickBooks, and it's beautiful. It's amazing. I don't have to export batches anymore. It just shows up in QuickBooks.”
The new features also give AirWorks Solutions flexibility when making an adjustment to an invoice after it’s already been exported.
“Instead of an invoice adjustment, now you can just go fix the invoice. You can just change it. That's the biggest thing,” she says. “Adjustment invoices are messy and confusing. You've got a big trail of mess because you're fixing your mistakes on exported transactions.”
The same idea applies to your deposit workflow, Jaeger says. For instance, if you export an invoice and export a payment, but fail to connect the two before closing out your books for the month, the only way to update the information is to manually fix it across both ServiceTitan and your accounting system. The new features allow you to fix it one time in one place.
“This idea of having a single source of truth is really key in reducing those kinds of manual steps across both systems,” Jaeger says.
The new automated features also free up your accountants to do more value-added tasks, he adds.
“If your accountant is able to look at the customer data, make sure invoices are accurate, make sure you're sending unsent invoices out, collecting payments in more real time…we want to give the accountant leverage to provide that value to the company versus just migrating data,” Jaeger explains. “Being able to track expenses that are going up, being able to provide information to the owner, that's the value we want the accountant to be able to provide.”
Ask us anything about Journal Entries & Touchless Integration
Here’s a recap of some of the questions asked about Journal Entries and Touchless Integration during the webinar and the answers received.
Q: Is it on the roadmap to take QuickBooks Online out of the picture and only use ServiceTitan as the accounting software?
A: “I would love to be an all-inclusive accounting platform, but at the same time I recognize that QuickBooks and these other accounting systems do have incredible capabilities as a General Ledger. We're not a full accounting solution yet,” Jaeger says.
Q: Can we possibly use another accounting system [other than QBO or Intacct]?
A: Journal Entries unlocks virtually any accounting system. As long as you can import the Journal Entry, you can use anything. You aren't limited to QuickBooks and Intacct. But the automation added through Touchless Integration is limited to QBO and Intacct.
Q: Does my accountant need a specific seat or license to access ServiceTitan Journal Entries?
A: Your accountant will need access to your accounts receivable, invoicing, and other payment data within ServiceTitan, which is part of your paid ServiceTitan plan.
Q: How does this affect payments? Can you explain the process for exporting payments and creating a bank deposit?
A: “I refer to it as auto-reconcile, because what's happening is all the payments that you collect for the day, we’re reconciling that to your settlement and we’re creating a bank deposit inside of ServiceTitan,” Jaeger says. “With document-based, we only send over the payment and then you have to regroup them and then create a deposit. With the journals, we're able to immediately accept all those payments.”
Q: How do the new features benefit inventory management?
A: “The issue that we found is customers would manage inventory in ServiceTitan and then again at that pricebook level, trying to sync locations and quantities on those locations,” Jaeger explains. “If anything was ever out of whack or if they made a change externally and didn't make it in ServiceTitan, there were potential issues.
“With the journal approach, you don't have to pay for those additional inventory features in that external software. You're already paying for it using ServiceTitan, and so we can increase the asset balance when you export bills, and when you export a Journal Entry via an invoice, it decreases the asset balance for you.”
Q: Is there a way to try out Touchless Integration in the Next environment before using it in the live ServiceTitan environment?
A: No, Touchless Integration is currently only available in production mode or the live ServiceTitan environment.
Q: Is there any value to using QBO vs. Intacct?
A: Larger companies who seek granular financial reporting often use Intacct, whereas companies that don’t need a complicated chart of accounts tend to use QBO.
Q: How does Touchless Integration improve sales tax management?
A: Everything will get grouped into a sales tax payable GL account within ServiceTitan, and it'll export to that liability account. If you want a detailed breakdown, if you have multiple tax zones, or if you only have one institution to pay to, the tax details zone report exists within ServiceTitan. But once you break that down, you can then pay your tax bill. If you're going to leverage Touchless, you would want to leverage ServiceTitan's ability to calculate those taxes and use those reports to then pay your necessary institutions.
>>Learn more about Journal Entries and Touchless Integration with the following resources:
