2026-07-28 | Reading time: 10 minute(s)
Managing payments in a daycare involves more than just collecting money — it means making sure every dollar is applied to the right invoice, in the right order. With the introduction of FIFO payment allocation in MyDaycare Plus, that process just got a lot more automatic.
FIFO stands for First In, First Out. In the context of payment allocation, it means that when a payment comes in, it is automatically applied to the oldest outstanding invoice first, then the next oldest, and so on — in chronological order.
In practice, this is how most daycare administrators were already handling payments manually. The new feature simply makes it the default behaviour of the system, so you no longer have to think about it or do it by hand.
FIFO allocation is an optional feature that you turn on yourself, on your own timeline. To enable it, go to:
App Settings → Modules → Finances and Accounting
Once activated, the system takes over immediately. You do not need to review or adjust any historical transactions — MyDaycare Plus handles the entire allocation chain from that point forward, including past records, automatically.
What Changes in Your Day-to-Day?
Before FIFO, when recording a payment, you had to manually select which invoices the payment should be applied to. With FIFO enabled, that step disappears — the system selects the invoices automatically, starting from the oldest unpaid one.
For most daycares, this is not a dramatic shift. The result is the same as what you were doing before, just without the manual selection step.
What If You Want to Allocate Manually?
FIFO does not remove your ability to control allocation. If you need to apply a specific payment to specific invoices — for whatever reason — you can still do that directly within the payment record. The option to override the automatic allocation is always available at the individual payment level.
Families with Multiple Children
When a parent has more than one child enrolled at your daycare, FIFO allocation applies across all of their children. The system looks at the full balance for that family and allocates the payment to the oldest outstanding invoice regardless of which child it belongs to.
What About Changes to Past Transactions?
This is where MyDaycare Plus goes further than a simple FIFO rule. One of the biggest challenges with chronological allocation is what happens when you need to insert, modify, or cancel a transaction that already sits in the middle of an existing chain.
With most systems, this creates a cascade of errors you have to fix manually. With MyDaycare Plus, the system automatically rebuilds the entire transaction chain whenever a change is made — no matter where in the timeline that change occurs. Add a forgotten invoice from three months ago? The allocation recalculates itself. Cancel a payment? Same thing. You always end up with a consistent, accurate allocation without any manual cleanup.
Introducing Account Analysis
Understanding exactly which payment is applied to which invoice can be tricky — especially when some payments have been cancelled or partially applied over time.
To help with this, we have added a new Account Analysis tool. It gives you a clear, structured view of the complete allocation history for any parent account: every payment, every invoice it covers, and exactly how much of each payment was applied and what remains.
This is particularly useful when you need to investigate a discrepancy, prepare for an audit, or simply explain a balance to a parent. The screenshot below shows an example of the Account Analysis view, including partial payments and multi-invoice allocations.
Questions or Need Help Getting Started?
If you activate FIFO allocation and run into any questions, or if you would simply like more information before enabling the feature, do not hesitate to get in touch with our team. We are here to help you make the most of every feature in MyDaycare Plus.