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Every deal in Qlero is built from three pieces. A payee is who you pay. An account is a balance that groups deals under that payee. A contract is the deal itself. This article explains what each level does, how money moves between them each period, and when a payee needs more than one account.

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The three levels

Payee. The person or company you pay: an artist, a producer, or another label. The payee holds contact and billing details, the reporting currency its statements use, and the final balance you invoice and pay out. Account. A running balance inside a payee that groups contracts. When you create a payee, Qlero creates one account for it automatically, named Default account. For most payees that single account is all you need. Contract. The deal you calculate royalties for. A contract belongs to one account, and through it to one payee. It carries the terms that price the deal and is assigned to the tracks and releases it earns on. One payee can hold several accounts, and one account several contracts:

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What happens each period

When an accounting period runs, Qlero builds statements from the bottom up:
  1. Each contract collects its share of the period’s sales and costs, applies its terms, and adds the result to its balance. The balance at the end of the period is the closing balance: positive means the deal has money to pay out, negative means it is unrecouped.
  2. Contract balances roll up to the account. A positive closing balance transfers to the account. A negative one stays on the contract, unless the contract is Cross-recoupable, in which case the deficit moves up and the account’s other contracts offset it. A contract can also set a threshold: any balance below it, positive or negative, carries forward to the next period instead of transferring.
  3. Account balances roll up to the payee under the same rules. Accounts have their own Cross-recoupable switch and threshold.
  4. The payee balance is what you settle. Invoicing and payment work from this top-level balance. For payees on the Self-Billing Auto billing type, the invoice threshold sets the minimum balance before Qlero generates an invoice; if a payee has none, the record company’s default applies.
Each contract in the period, along with its account and payee, gets its own statement, so you can always see where a balance sits and how it moved. Contract statements are produced in the payee’s reporting currency; account and payee statements follow the currencies of the amounts that land on them.

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When to give a payee more than one account

The Default account is enough for most payees. Reach for extra accounts when deals need to stay apart: Different accounting rhythms. All contracts on one account must use the same accounting period type, so a monthly deal and a yearly deal cannot share an account. Separate statements and balances. Each account gets its own statement and running balance, which is useful when a payee wants one project reported apart from another. Separate recoupment pools. Contracts on the same account can recoup from each other: when a Cross-recoupable contract closes with a deficit, the earnings of the account’s other contracts offset it before anything pays out. To keep two deals fully separate, place them in different accounts and leave Cross-recoupable off on those accounts. Setting up cross accounting covers these switches in detail. An account can later be moved to another payee, as long as both payees use the same reporting currency, the target payee has no account with the same name, and it is not the source payee’s only account.

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Next steps

Set up your first payee and contract: First-time setup.