CITADEL BUSINESS SYSTEMS DOCUMENTATION A C C O U N T S R E C E I V A B L E OVERVIEW PROCESSING FUNCTIONS ♦ Accounts receivable cash receipting ♦ Accounts receivable journals ♦ Write off small balances CASH SALES DEBTORS ACCOUNTS ACCOUNTS RECEIVABLE ROUNDINGS ON ACCOUNT CASH ACCOUNTS RECEIVABLE AGEING ACCOUNTS RECEIVABLE POSTING PERIOD OPEN ITEM DEBTORS VERSES BALANCE FORWARD DEBTORS DIARY NOTES MESSAGES STATEMENTS GENERAL LEDGER INTERFACE FOREIGN CURRENCY DEBTORS ENQUIRIES AND REPORTS Accounts Receivable System Manual Version 14.1
Transcript
CITADEL BUSINESS SYSTEMS
DOCUMENTATION
A C C O U N T S R E C E I V A B L E OVERVIEW PROCESSING FUNCTIONS ♦ Accounts receivable cash receipting ♦ Accounts receivable journals ♦ Write off small balances CASH SALES DEBTORS ACCOUNTS ACCOUNTS RECEIVABLE ROUNDINGS ON ACCOUNT CASH ACCOUNTS RECEIVABLE AGEING ACCOUNTS RECEIVABLE POSTING PERIOD OPEN ITEM DEBTORS VERSES BALANCE FORWARD DEBTORS DIARY NOTES MESSAGES STATEMENTS GENERAL LEDGER INTERFACE FOREIGN CURRENCY DEBTORS ENQUIRIES AND REPORTS
Accounts Receivable System Manual Version 14.1
TABLE OF CONTENTS OVERVIEW ........................................................................................................................................... 1
Placing money "On account"............................................................................................................. 13 On account Distribution .................................................................................................................... 14
Ageing by month ................................................................................................................................ 15 Ageing by overdue days ..................................................................................................................... 16
Implementation .................................................................................................................................. 29 Sales (invoicing) ................................................................................................................................ 30 AR cash receipts ................................................................................................................................ 30 AR "On Account" cash....................................................................................................................... 30 AR Journal Entries ............................................................................................................................ 30
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Write off small AR balances............................................................................................................... 30 Write off small transaction balances ................................................................................................. 30 AR Enquiry ........................................................................................................................................ 31 AR Summary and Open Item Trial Balances ..................................................................................... 31 Unrealised and Realised Exchange Gains and Losses ...................................................................... 31
ENQUIRIES AND REPORTS ............................................................................................................ 32
ACCOUNTS RECEIVABLE ENQUIRY ......................................................................................................... 32 OPEN ITEM TRIAL BALANCE .................................................................................................................... 33 SUMMARY TRIAL BALANCE ..................................................................................................................... 34 ACCOUNTS RECEIVABLE HISTORY REPORT .............................................................................................. 34 ON-ACCOUNT TRANSFER HISTORY LIST ................................................................................................... 35 ON ACCOUNT LIST ................................................................................................................................... 35 CUSTOMER ABC ANALYSIS .................................................................................................................... 35
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OVERVIEW The accounts receivable module centres around the management of the asset trade debtors. It consists of three processing functions, a number of reporting and enquiry options and processes to assist in the management of the asset. The processing options cover: • Cash receipts entry • Journal entries • Small balance write off Each of these processes update the amounts owing by the debtors with the transactions generally relating to an existing transaction ie. an invoice created in the sales invoicing process. The processes all create general ledger posting entries to reflect the financial affect of the transactions done. The reporting options cover processing reports and enquiry facilities, the normal month end report requirements and accounts receivable history reports. These include bank deposit schedule print/reprint, diary note reports, statement print/reprint, A/R trial balances (summary and detail), A/R history reports and an A/R enquiry facility. The processes to assist in the control and management of trade debtors include an invoice message facility, a statement message facility and a diary note facility. The module covers both local currency debtors processing and foreign currency debtors processing. This is based on the currency set on the customer master files. The module allows debtors’ accounts to be held in either an open item format or a balance forward format. Accounts can also be held in an open item format but have their statements printed in a balance forward format. This detail is all defined and held on the customer master file. The module is fully integrated with: • Order entry/invoicing • Service management • Agency sales • General ledger • Marketing Entries created within these modules are automatically posted if applicable to the accounts receivable module. Entries done in the accounts receivable module are also posted, if applicable, to any other relevant module.
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PROCESSING FUNCTIONS
Accounts receivable cash receipts Accounts receivable cash receipts processing can be done using two different processes: AR cash receipts entry DD.ARCASHREC AR cash receipts by invoice DD.ARINVCASH DD.ARINVCASH1 The amount received is held against specific invoices paid if the customer is operating in an open item mode. If the customer has been flagged as a balance forward customer (b/f) the cash receipts are held as transaction lines on the debtor’s account. Cash receipts entry (by cheque) The cash receipts process DD.ARCASHREC consists of two screens. The first screen allows base data to be captured covering which bank account is to be debited, who the cash is from, and the cheque detail (amount, bank and branch). The second screen allows the transaction detail that is being paid to be specified Screen 1 The bank account specified receives the deposit. Its currency is displayed to the operator. Deposits are recorded in this currency. Operator security is driven by the operator security facility and is set to optionally operate by a program parameter in DD.ARCASHREC The customer specified must have the same currency as the bank account the deposit is being made to. The cheque number is recorded for payment history purposes and is carried through to the second screen as the transaction detail being paid is specified. This field is also used to access the on account transactions held for the customer (cash already receipted but not yet allocated). If a cheque number is entered it is taken that cash is being receipted. If nothing is entered and the return option taken then the "on account" distribution options are provided. The "on account" distribution option allows "on account" money to be either distributed within the customer's account that has been specified for the banking or to be transferred to another customer's account. If transferred, it is placed "on account" in the recipient's account. (For further detail see the section "On account" cash). Receipt dates can be optionally entered and drive the posting period depending on the setting of the program parameters in the various programs. - see accounts receivable posting period.
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Cheque detail covering drawer, bank and branch is specified in order that the bank deposit schedule contains meaningful information. These three fields will default based on the customer specified for the banking and previous cash receipts entries for the customer as it is likely that his/her cheques will be drawn on the same bank and branch. The cheque amount specified should be the value of the cheque being banked. If the customer is a balance forward customer this will be the end of the process for that receipt. However, if the customer is an open item customer it will be necessary to allocate the cash received to invoices outstanding or placed "on account". Screen 2 The second screen is the cash allocation screen. This screen is only displayed if the customer’s account operates in the open item mode. The invoices that are being paid are flagged with the value paid. This may be the total amount of the invoice or a greater or lesser amount. Contract numbers can be displayed in the place of invoice numbers via a setting defined in the program parameters in DD.ARCASHREC. If the allocation is to be for the full invoice value a "." will automatically input the invoice value. Use of the (F)unction facility will allow invoices to be accessed either by invoice number or invoice date. The full amount of the cheque must be either allocated against invoices held or placed "on account" before the receipt can be updated. The batch control value and the balance to apply are continually shown to the operator. If the on account option is taken to allocate part of the receipt, a narrative reference can be entered.. The on account value will be automatically given an on account reference and included in the on account balance for the customer. Fast track allocation of cheque amounts can be done if the program parameters in DD.ARCASHREC are set to allow it. Two options exist: • Autopost • Autopost with exact match only The autopost option will automatically allocate the receipt amount starting with the oldest invoice. At the finish of the allocation a balancing amount will be allocated to the last invoice referenced. The autopost option "with exact match only" will only let the autopost option be activated if the last invoice referenced is settled in full.
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Any number of cheques can be entered within the one banking. A batch total is displayed to the operator on the allocation screen for reference purposes. Program parameters can be set to a) warn the operator before he exits the process b) automatically print the bank deposit schedule on exit c) allow customers credit limits to be updated during the receipt process General ledger entries are generated for cash receipts.
Debit Bank Credit Accounts receivable
Cash receipts By Invoice Two cash receipts processes are available that allow cash received to be entered by reference to the invoice being paid. The first of these processes DD.ARINVCASH does not require any balancing to the cheque amount. After the bank has been referenced the cheque number is input. Then the invoice number being paid is input. This will be validated against the outstanding invoices. If a valid invoice is referenced, detail covering customer, bank, branch, invoice date and invoice amount will default. The operator is then prompted to confirm the drawer, the bank name, bank branch and the cheque amount. The applied amount can be different from the invoice value. The accounts receivable transaction file is updated accordingly. As each entry is updated, the operator is returned to the invoice number field for the next invoice number being paid. This can be entered leaving the cheque number in place in order that all the invoices paid on the cheque are given the same reference number. Entry of no invoice number will prompt for the next cheque number to be entered. The process can be repeated until all cheques are input along with their payment detail. Entry of no cheque number detail will prompt the operator that they are exiting the process. A bank deposit schedule will be produced on exit depending on how the program parameters are set. A variation of this receipting process exists in the program DD.ARINVCASH1. This process allows the amount entered to be balanced to a cheque batch total amount before the process can be exited. In this process the cheque amount is entered after entry of the cheque number or reference.
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Cash receipting using one cheque for allocation against multiple customers This receipting process allows multiple customers to be referenced for one cheque DD.MULTICASHREC. The process is similar to the standard AR cash receipt process (DD.ARCASHREC) except that the customer and the amount to be applied to him is referenced after the detail of the cash/cheque received. The customer and amount is looped until the cheque value is allocated. Note: On account cash cannot be distributed or transferred using this process. Program parameters must be set in DD.MULTICASHREC and DD.ALLOCASH. The enquiry process DD.MLTCHQENQ displays the allocation details for the cheque entered. Selection of a customer from the enquiry screen will allow a drop to AR enquiry. The purge process DD.MLTCHQPURGE purges the records from the cheque/customer cross-reference file up to a specified date. The file is updated during DD.MULTICASHREC and is used by the enquiry process DD.MLTCHQENQ.
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Bank deposit Print Bank deposit schedules can be printed when the accounts receivable cash receipts screen is exited or from a standalone bank deposit schedule print process. This is dependant on the setting of the program parameter in DD.ARCASHREC "Accumulate Bank deposits - print later". If set to “N” then bank deposit schedules are automatically printed as the accounts receivable cash receipts process is exited. If set to “Y” then receipt detail is accumulated until the deposit schedule print process is run. Each bank deposit schedule is given a reference number that can be used later for reprint and reference purposes. The bank deposit schedule should be taken with the cheques to the bank when the lodgement is made. If more than one copy of the lodgement slip is required, printer form queue maintenance should be done before the deposit schedule is printed and the required number of copies specified. The bank deposit schedule can be directed to a specific form queue via a setting defined in the program parameters of DD.ARCASHREC. The printing of the bank deposit schedule updates the bank file. Each deposit is held against its schedule reference. If bank deposit schedules are accumulated and printed using the stand alone bank deposit schedule print facility (DD.BANKDEPRINT) it should be noted that the bank file and the general ledger bank account can become out of balance. This results from the general ledger being updated when the general ledger updates are run, which can be prior to the deposit schedules being produced and passed to the bank file. A program parameter in the process DD.BANKDEPRINT also optionally allows deposit schedules to be consolidated for all users rather than printing schedules by user. This is often only applicable if the users are doing the banking from one location. Deposit schedules can be reprinted as required using the reprint process DD.BDREPRINT. Note: The bank deposit schedule can be customised. Two standard formats are available -
one prints in the sequence that the cheques were entered and the other prints in cheque number sequence.
Settlement Discounts Settlement discounts can be given during the cash receipting process by setting the program parameter switch in DD.ARCASHREC to allow settlement discount processing. The cash allocation screen is then formatted to allow the input of a settlement discount by invoice. The operator is first prompted for the cash amount that is to be allocated to the invoice. The amount specified is subtracted from the cheque being processed and the value still to be applied adjusted.
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The operator is then prompted for the discount amount that is to be allocated to the invoice. The amount specified reduces the amount owing by the customer for the invoice. A cumulative discount total is kept for the operator's reference on the top of the allocation screen. Discounts given become a transaction line on the customer's account and are attached to the invoice for which the discount was given. The reference given to the transaction is DIS XXXX (the cheque number). General ledger entries are generated and posted for the financial impact of discounts given.
Debit Settlement discounts given Debit GST on sales invoices Credit Accounts receivable
The “discounts given” account is defined on the branch general ledger code file. The tax portion of the discount given is coded to the “tax on sales invoices”- account as defined in the company general ledger code file.
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Accounts receivable Journals The accounts receivable journal process DD.ARJNLENTRY is used to adjust debtors accounts by specified amounts. Entries can be made to debtors accounts through reference to an invoice held on the account or placed on the debtors account as a standalone transaction. If placed on the account in its own right the user will, however, be warned that the transaction is going to be a stand-alone transaction and not attached to an existing reference (invoice). Adjustments to debtors accounts made by accounts receivable journals do not affect sales analysis. It is therefore important that they are not used for price adjustments, sales returns, etc. These should be done using the credit note process. This ensures that sales analysis records are updated correctly for sales values, cost values and quantities. In addition, by processing a credit note the customer can be given a document covering the adjustment. Accounts receivable journals update the debtors file and the general ledger. The journal created is in effect a general journal that also updates the subsidiary file - debtors. They therefore are included on the general journal audit trail. AR journals can be either positive or negative. If positive (debit) they increase the amount owing by the debtor. If negative the balance owing by the debtor is decreased. The amount and the sign that the debtors account is to be adjusted by is nominated as the first leg of the journal. The user is then prompted for the general ledger coding to complete the double entry (to make the journal balance). Journal processing After identification of the customer the operator is prompted for the journal date. This is the date that the journal will show on the accounts receivable enquiry screen if the journal is attached to an existing invoice. The date is forced to be the system date if the transaction is a stand-alone entry. The posting period is always the current accounts receivable period. The reference prompt looks for a record on the accounts receivable transaction file. The reference entered will normally be an outstanding invoice but can be another journal reference. If the reference entered is not on the accounts receivable transaction file, the operator will be warned and will be asked if he/she wishes to (B)ypass or (C)ontinue. Entry of the accounts receivable amount is made the way the debtors account is to be affected. If the debtors account is to be reduced the entry is entered as a negative. If it is to be increased it is entered as a positive. The amount entered is the value that the debtors account will be adjusted by.
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The amount entered must then have the other side of the journal coded. This is done by entry of general ledger codes and amounts. Multiple codes and amounts can be entered. The amount that is needed to be entered to complete the double entry is continually displayed to the user. It is not possible to update the journal until the transaction is in balance. When the journal is in balance it can be updated. A journal number reference is displayed to the operator. This becomes the general ledger journal number. General ledger coding validation General ledger codes that are entered in the accounts receivable journal process can be validated against codes held on the GLARLIST. If the list does not exist then no validation is done. The general ledger accounts receivable maintenance process (DD.GLARMAINT) is used to specify the general ledger accounts that are to be held on the GLARLIST. This process is also used to maintain the list and to delete the codes from the list. The validation facility allows the coding of adjustments done to the accounts receivable file to be controlled. Only accounts that are appropriate to AR adjustments should be included. e.g. bad debts. A message is given to the operator at the time of account entry if the account entered is not valid.
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Write off small balances Small balances owing can be written off using processes that sweep through the debtors file and write off small balances owing. These can be either a small balance owed by a debtor or a small balance still held on a transaction. Write off small balances still owed by a debtor DD.ARWRITEOFF Write off small balances held on a transaction DD.ARTWRITEOFF The range of amounts that are to be written off is specified and would normally be set as negative something to positive something - the amount being a value that is determined as not being worth the effort to keep reconciling the customer's account for. The balance owing relates to an amount owing by the customer or the amount owing on an invoice or customer transaction. These could occur where an invoice is either under or overpaid by a few cents or where a credit note or journal does not quite contra an invoice. The double entry is specified each time the process is run. This would normally be an expense account classified like discounts given. The process creates an accounts receivable journal entry. A journal reference is given to each transaction cleared and shown on the customer's account alongside the transaction. An audit of the write-offs is automatically produced as part of the process and should be kept as the journal audit trail.
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CASH SALES DEBTORS ACCOUNTS Cash sales debtors accounts are customers with their master file flagged with the “cash sales” indicator. Payment for invoices raised for these accounts is done in a different manner to normal customers. For accounts that are flagged with the cash sales indicator the cash receipting process is automated through the use of the cash sales deposit schedule process (DD.BANKCASH). The cash sales deposit schedule print process (DD.BANKCASH) creates a banking record for all transactions outstanding for a specified customer. • Each outstanding transaction on the account is flagged as paid • A cash sales posting audit is produced with a bank deposit reference • The bank file is updated • General ledger entries are posted for the banking The first prompt in the cash sales deposit schedule print process is for the bank account that is to be used for the banking. This account will determine the general ledger posting for the bank account and the bank file that will hold the deposit record. The customer account is then nominated. Only one account can be nominated per banking. On update, a bank deposit schedule reference will be displayed to the operator and a cash sales posting audit printed. This audit lists the invoice numbers and amounts included in the banking run. This is used as the bank deposit record. Reprints of the list can be done using the cash sales deposit schedule reprint process (DD.BCASHREPRINT). Each transaction on the customer account is then flagged as paid. General ledger posting entries are generated for the banking. Debit Bank Credit Debtors A procedure should be established by the operator to bank the money as per the deposit schedule produced. The cash sales deposit print process should be run on a regular basis by the operator to continually clear the transactions held in the cash sales accounts. It is important that the normal accounts receivable cash receipts processes are not used for "cash sales" accounts (accounts with the “cash sales” indicator flag).
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ACCOUNTS RECEIVABLE ROUNDINGS Invoices raised can be rounded by a specified amount by customer. The rounding adjustment can be made up, down or to the nearest amount to a specified amount. eg customer 10256 AB Traders Ltd rounding amount .05 cents 5 cents (U)p (D)own or (N)earest an invoice for $10.52 rounded up = $10.55 rounded down = $10.50 rounded nearest = $10.50 Whilst the rounding process does not affect the operation of the debtors facility it is important to recognise that postings made to both the sub ledger and general ledger are for the rounded amount and not the sales value. The rounding specification is done for each customer in the customer rounding maintenance process DD.CUSTROUNDMAINT. The general ledger account that rounding differences are to be posted to is specified in the branch general ledger code maintenance process. - see system implementation manual - general ledger account definition. Within the customised invoice print process allowance should be made for roundings done in order that the invoice print value is the same as the posted accounts receivable value. The rounding amount can be shown on the invoice or it can be accepted that the invoice lines do not equal the total invoice value. The general ledger postings for the example of $10.52 rounded up are debit accounts receivable 10.55 credit sales 10.52 credit AR rounding .03 a gain of .03 cents is made.
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"ON-ACCOUNT" CASH "On-account" cash is the term given to money held on account for a customer. This money would normally result from money paid by a customer where no invoice has yet been raised. It may also arise, however, where the cash received is unable to be allocated specifically due to no payment detail being received with the receipt. The receipt could be put "on account” awaiting payment detail. Facilities exist to: • Put cash received "on-account" • Allocate "on-account" cash within the customer's account • Transfer the on-"account" cash to another customer Cash held on account is kept in a separate category within the customer's balance owing. It is not aged along with invoices and credit notes and is shown as a separate figure on ageing reports and on the accounts receivable enquiry screen. It is however included in the balance owing. Although on-account cash would normally be a credit on the customer's account it is shown as a positive figure in the on-account field. By inference of it being cash held for the debtor it is deducted from the balance owing. In other words, if the customer has no invoices outstanding but has $30 on-account, the account would have a balance of -$30. A parameter switch in DD.ARCASHREC also allows negative on-account cash to be held. This is, however, an unusual situation as to have a negative on-account value it means that an invoice has been marked as paid when it fact it has not been. If placed as negative on-account it is important to ensure that the debtor is aware of what makes it up. On-account cash cannot be placed on a customer's account if the customer is flagged as being a balance forward customer. The cash receipting program for balance forward customers does not, by inference of the type of account, ask if the money is to be put on account. The on-account transfer facility will also not allow the transfer of on account cash to a balance forward account. Placing money "On account" Money is put on account using the accounts receivable cash receipts process. During the allocation of cash receipts the option is given to the operator at the end of each screen of transactions to put the unallocated portion of the receipt "on account". Selection of this option will automatically place the unallocated balance of the receipt on account. A transaction reference will be given to the operator as well as the option to enter some narrative text to be held on file for the on account transaction.
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On account Distribution On account distributions are also done using the accounts receivable cash receipts facility. These can either be:
(a) allocating the on account cash against invoices on the customer record (b) transferring the "on account" cash to another customer
The processes are accessed from the header screen of the AR cash receipts process. If no cheque number is entered in the receipt process the options are presented to the operator:
(O)n account distribution or (T)ransfer on account cash
Selection of (O)n account distribution brings up a screen to allow the on account transaction that is to be allocated to be specified. Transaction detail is displayed to the operator. Selection should then be made of the transaction to be distributed. The original cheque reference and cheque date are recorded on the accounts receivable transaction file against the invoice marked as paid. The letters OD precede the cheque reference to inform the operator that the cheque has come via “on account” cash. If the complete transaction is not allocated, i.e. the on account option is taken in the allocation process, a new on account cash transaction record is created for the unallocated portion. Selection of (T)ransfer on account cash brings up a screen to allow both the on account transaction that is to be transferred and the customer that it is to be transferred to, be specified. The complete transaction is transferred and is held on the new customer account under the original on account cash transaction reference. The report on account transfer history list DD.OATFRLIST details out transfers of on account cash made between customers.
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ACCOUNTS RECEIVABLE AGEING Ageing of amounts owing by debtors (accounts receivable ) can be done using the traditional method of current, one month, two months three months etc. or be based on overdue days. The traditional approach holds all the current months sales as current debt. In the month end process this is all rolled to 1 month. The one month debt is rolled to two months and so on. This approach simply categorises the debt according to the accounts receivable periods and does not take into account when the debt is actually due. Traditionally the one month debt is due on the 20th of the month so anything in the two months and over category is overdue (based on trading terms of 20th of following month) The approach of showing debt when specifically due provides a more accurate picture of what is overdue and by how many days it is overdue. This is done by flagging each customer with his trading terms and ageing invoices by these terms according to predefined age buckets. The two methods are mutually exclusive The method that is to be used must be specified in the company program parameter file. (DD.COPARAMAINT) - “AR monthly ageing (or daily) - Y/N”. If set to “Y” ageing is done by month. If set to “N” ageing is done by overdue days Ageing by month No special set up is required to do accounts receivable ageing by month. The ageing is all done as part of the end of month roll for accounts receivable. EOM tasks must include the process DD.ARAGE. Reports available include DD.ARSUMMTB - summary AR trial balance showing current, one month overdue, two months overdue, three months + overdue DD.ARBRSUMM - summary AR trial balance with just branch totals showing current, one month overdue, two months overdue, three months + overdue DD.ARTB - summary AT trial balance showing overdue amounts by month for 12 months DD.OITB - as per the summary trial balance with a further option to show transaction detail
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Ageing by overdue days If the days overdue method is to be used it is necessary to set up the days overdue breaks or buckets that are to be used. This covers for each break, its description, its from day, and its to day. These are then used and dynamically painted in the AR enquiry process etc. The process to define the buckets is accounts receivable bucket maintenance ( DD.ARBUCKETMAINT) The days defined is forced to include zero days overdue and be consecutive. i.e. 0 days 1 - 7 days 8 - 14 days 15 - 30 days 30 + days Five breaks or buckets are defined. Each customer must also have his trading or ageing terms defined. This is done in the customer maintenance process - screen 2.(DD.CUSMAINT ) The relevant fields are Statement frequency (W)eekly or (M)onthly Statement day (for weekly statements only) 1 to 7 with 1= to Sunday Credit days number of credit days from either statement (if defined) or from invoice. The three attributes work together. For example 1) if the statement frequency was defined as weekly, the statement day 2 (Monday), and the credit days 7, then all invoices raised one week would be due 7 days from the following Monday. 2) if the statement frequency is defined as (M)onthly the credit days are taken from the normal month end statement process. If the traditional terms of "20th month following" were given to a customer then the credit days would be specified as 20. All invoices raised one month would become one day overdue on the 21st of the following month. 3) if no statement frequency (and therefore no statement day) was defined each invoice would become overdue based on the credit days specified from the invoice date.
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To enable the system to calculate the amount overdue on a daily basis two processes must be run on a daily basis. These are: DD.ARTDDUPDATE (this calculates the due date for each AR transaction and updates the transaction record) DD.CUSTDBALCREATE (this process clears and rebuilds the customer daily aged balances from the AR transaction file.) These processes must be run in the correct sequence. The due date must be calculated for each transaction before the rebuild is done of the customers aged balance. The processes must be included in the EOD job stream to ensure they are run on a regular basis and for them to work as they reference an end of day date in order to do the calculations. The process DD.DUEDATE must also be included in the CONTROL file in the record PROGRAM attribute (50). Reports include: DD.ARSUMMTBD - summary AR trial balance by overdue days according to the buckets defined.
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ACCOUNTS RECEIVABLE POSTING PERIOD Postings are normally done to the current AR period but it is possible to set the system up to post transactions to the period relating to the date of the transaction. This is done via program parameter settings in the various processing options It is important that the system is set up consistently and the custom print programs (statement) allow for the way the system is set up. Sales invoicing / credit notes Order entry to invoice (DD.OEPICKED) set pp in DD.ORDERENTRY “force AR period to agree with trans date - Y/N” Order entry to pick (DD.OETOPICK) set pp in DD.CONFIRM “ force AR period to agree with transaction date - Y/N” Credit notes (DD.OECREDIT) set pp in DD.OECREDIT “force AR period to original order period - Y/N” Invoices raised if these program parameters are set to “Y” are posted to a) The current AR period if the transaction date is before the next EOM date. b) The next AR period if the transaction date is after the next EOM date. Credit notes raised that reference an original order are posted to the period defined by the order date. Standalone credit notes are not affected. There are also other sales / invoicing processes that are not affected and by default transactions generated by the process are posted to the current AR period. The posting period is only ever one month in advance of the current AR period no matter how far in advance the order is dated. The system compares the transaction date with the last EOM date to determine the period. The last EOM date is defined in the control file, attribute 1. For it to be defined the program parameter in the program DD.EOM - “set next EOM date” must be set to “Y”. Each time an EOM is done for accounts receivable / payable the date is reset. Note: although the AR transactions are flagged with the posting period, the stock
transactions are posted to the current AR period. All general ledger entries are posted to the period the AR transaction takes – i.e. debtors, sales, cost of sales, inventory.
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Cash receipts Cash receipts by cheque (DD.ARCASHREC) set pp in DD.ARCASHREC “allow entry of cheque date (to determine posting period -1 month, current or 1 month).” Cash receipts by invoice (DD.ARINVCASH) set pp in DD.ARINVCASH “allow entry of cheque date (to determine posting period -1 month, current or 1 month).” If the parameters are set to “Y” then the posting period is determined by the cheque date that is specified rather than the current AR period. The period is determined by comparing the cheque date with the period definition held by the system. This is set up using DD.GLPDEF. Note: The period definition’s primary function is to allow user defined financial periods
rather than monthly financial periods. If AR transactions are being posted to periods other than the current AR period it is important that their statement print program recognises that only entries held to a specified period should be included in the print. The aged balance that is to print must also be calculated as part of the print process as it may be different to the balance held on the customer file at the time of the print. (If transactions are held for future periods) The AR reports allow periods greater than a specified period to be excluded from the reports. When the reports are run the ageing is also recalculated in order that it will match with the transactions on the report and not the current ageing of the debtor. Note: The summary AR trial balance report DD.ARSUMMTB can only be used if the
forward posting facility is not used as it uses figures from the balance held on the customer file. If a summary version of the aged trial balance is required it must be run from the summary option of the open item trial balance process (DD.OITB)
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OPEN ITEM DEBTORS V BALANCE FORWARD DEBTORS Debtors accounts can be run in either open item mode, or in balance forward mode. The mode is specified by customer with the specification being made on the customer master file. The mode the customer is to operate in cannot be changed after it has been set. If the customer is to operate under a new mode it is necessary to set up a new account for the customer. Two parameters in customer maintenance (DD.CUSMAINT) should be set to allow the system to be operated in the required manner. 1. Force open item on balance forward parameter. 2. Open item or balance forward account. The first parameter specifies if the second parameter is to be forced. It can be set to Y or N. If it is to be forced (Y) then whatever is entered in the second parameter defaults and cannot be overridden. If it is not forced then whatever is set in parameter two defaults but can be overridden. Balance forward mode Customers set to operate in balance forward mode only show transactions for the current period. Prior period transactions are consolidated into an opening balance figure. Current period transactions include invoices, journals and cash receipts. Cash receipts are entered onto customer accounts as a total receipt figure. They are not allocated to specific invoices in the receipting process. The A/R cash receipts entry process uses only the first screen of the facility father than both screens. This allows only the cheque detail to be entered for the receipt (customer, cheque #, bank, branch and amount). Accounts in balance forward mode can only have statements printed in balance forward format. The field on the customer maintenance screen labelled “balance forward statement” automatically defaults (Y). Open Item Mode Customer accounts set in open item mode show all transactions that make up the balance owing by the customer. This includes invoices, journals and cash receipts. These transactions can belong to any period. The only criteria is that they are still owed by the customer. Cash receipts are held against the invoices that are paid and are not held as a single transaction on the accounts receivable file except in the customer payment history file. Invoices that have been paid in full are no longer part of the balance owing and therefore the cash receipts will not show. (Note, it is still possible to see all transactions including matched transactions by using the (F)unction - (A)ll.
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When cash receipts are entered for the customer both the cheque detail and the allocation screen are accessed. The full amount of the cheque must be allocated (or put “on account”) before the receipt can be updated. Accounts in open item mode can have their statements printing in either a balance forward format or an open item format. The field in the customer maintenance screen defining the format automatically defaults to open item format (balance forward format “NO”) but can be changed in order that open item accounts can look like balance forward accounts when statements are printed. Debtors Statement Formats Each debtor has their statement format specified as either balance forward or open item. Balance forward mode customers default to balance forward statement format . This cannot be altered. Open item accounts default to open item but this can be overridden to balance forward format if the statement is to be presented this way. The statement format selected for open item customer accounts can be maintained from open item format to balance forward format and visa versa. This is because the account is held as open item and all that is changing is the layout of the statement. However, for systems that have not previously been running with the two types of statement formats it is necessary to run a process to initially build the opening balance figures if statements are to be run in a balance forward format. It is necessary that two statement formats are designed if both open item and balance forward formats are to be used. Stationery must also be suitably designed if the printing of statements is to look professional.
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DIARY NOTES The diary note facility allows diary notes to be entered for customers and then recalled and read as required. Each diary note entered is given a reference number in order that it is held as a unique record. The record can then be maintained and deleted as required. Diary notes held on file can be recalled by customer. They can be recalled using a recall process or from within the accounts receivable enquiry facility. In addition, diary note listings by recall dates, can be done by the user who entered the notes. The basic diary note facilities are: Diary note entry DD.CUSTDIARYENTRY Diary note maintenance DD.CUSTDIARYMAINT Diary note list DD.CUSTDIARYLIST Entering Diary Notes As diary notes belong to a customer, the first reference that must be entered is the customer. The customer must exist on the customer master file. Before the actual note is entered a recall date can be specified. This allows the diary note to be recalled at a specific date using the diary note list facility. If no date is entered the note can still be recalled using the list facility by not specifying a recall date when generating the diary note list. Each diary note can be flagged (H)old. This prevents the diary note being purged in the purge process which is run by recall dates. The text of the diary note is entered in narrative form. Multiple lines can be entered. On update a diary note reference number is assigned to the note. Diary Note Maintenance To maintain a diary note or delete a diary note, the diary note is recalled via its reference number. (C)hange and (D)elete options are provided to the user. A parameter in DD.CUSTDIARYMAINT determines whether access is allowed to all users’ diary notes or not. Selection of the (C)hange option enables the diary note detail, including text, to be maintained for the note.
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However, if the customer is to be changed it is necessary to use the delete option and re-enter the note. The delete option deletes the diary note entirely. Each user can only delete notes that have been entered by him/herself. Diary Note List The diary note list facility allows a list of notes to be generated based on selection parameters of user identification, recall date ranges and customers. It is important to note that if no recall date has been given to a note and a recall date is specified for the report, the note will not be present. However, if a recall date has been given to a note and no recall date is specified for the report the note will be present.
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MESSAGES Messages can be input into the system that can then be printed on the appropriate document. Statement Messages The statement message maintenance facility (DD.STATMSGMAINT) allows messages to be entered into a file that can then be printed on customer’s statements. Care should be taken before each statement run to ensure that messages held on the statement message file are correct. They can be changed or deleted as required. Messages print on statements after the line detail. To enter statement messages the branch is nominated and then the message. If all branches are to have the same message, RETURN at the branch field picks up "all branches". Invoice Messages The invoice message facility (DD.INVMSGMAINT) works in the same way as the statement message facility. Messages that are to be printed on each invoice produced can be specified by branch. If the same message is required for all branches, RETURN at the branch field picks up all branches. Messages can be deleted as required by selecting the message required and using the (D)elete option.
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STATEMENTS Statement printing is normally done as part of the AR end of month processing. The various jobs associated with printing statements should all be included in the EOM job stream. A standalone statement job stream can also be run (DD.STATRUN) rather than having the jobs as EOM tasks. The jobs are defined in DD.STATEMENT. Statements can be reprinted from the previous month. Selection parameters for the statement reprint are branch and customer. Either selected branches or selected customers within branches can have their statements reprinted. (DD.STATREPRINT). The statement print job stream should be understood and set correctly in the EOMTASK file. Once set, there should be little reason to change it. The sequence of the jobs is important. If the normal monthly ageing process is used the ageing process should be the last process. Current balances should not be rolled to one month until after the statements have been printed. The ageing process will clear the current month allowing the next month's transaction to be built from zero. The purge process can be placed either before or after the statement print process. If placed before the statements are printed, transactions with zero balances (ie matched transactions) will not show on the statement. Whilst this will significantly decrease the number of lines printed on the statement it has the disadvantage of not showing the customer what has been paid for the month. If the purge process is placed after the print process, matched transactions will show on one statement print only. They are then purged for future print runs (the following month statements). Although the matched transactions are purged for statement printing purposes they are still held on the customer file. They can be held on this file (for viewing through accounts receivable enquiry) for up to three months (as specified in the program parameters). If balance forward statement print formats are done for open item customers the purge process must be run after the statement print process.
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The basic job stream that is set up is: PD.BATCHON DD.EOMCOPY SP-ASSIGN = STATEMENT HS DD.STATEMENT SP.ASSIGN DD.ATSUMMTB DD.OITB DD.ARPURGE DD.ARAGE SP-ASSIGN PD.BATCHOFF The statement flag on the customer master allows statement printing to be optional for each customer. Statements are printed in the sequence specified on the program parameter in DD.STATEMENT. The default, if no sequence is specified is by BNO by SEARCH by CNO.
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GENERAL LEDGER INTERFACE ENTRIES General ledger interface entries are posted from the processes: • Accounts receivable cash receipts • Accounts receivable journal entry • Write off small balances Accounts receivable cash receipts The interface entries are posted in the detail transaction updates. They are not posted as individual transactions to the general ledger. If the detail of the entries is required the general ledger detail transaction report must be used. Debit Bank Debit Settlement discounts given Debit GST on sales invoices Credit Debtors The interface account for the bank is nominated on the bank file referenced for the banking. This covers the full chart of accounts reference (branch and account). The interface account for both debtors and settlement discounts is specified on the branch general ledger code file. The branch that the posting is put to is determined by the branch code specified on the customer master file. The interface account for the tax portion of the settlement discount given is defined in the company general ledger code file. Transferring "on account" cash If on account cash is transferred to another customer, general ledger interface entries will be generated if the branches that the customers accounts are held in are different.
Debit Debtors (for branch transferring the transaction) Credit Debtors (for branch receiving the transaction)
If the customers are held in the same location no interface entries are generated. Accounts receivable journal entries Debit/credit Debtors Debit/credit A nominated general ledger account The interface account for debtors is specified on the branch general ledger code file. The branch that the posting is put to is determined from the branch code held on the customer master file. The general ledger code that is nominated for the double entry should reflect the reason for the adjustment i.e. the write off of a balance due to a bad debt. The full chart of accounts code is entered.
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Write off small balances General journals are created for small balance write offs. The general ledger interface entries are:
Debit/credit Debtors Debit/credit A nominated general ledger account
The nominated general ledger account is specified in the write off process.
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FOREIGN CURRENCY DEBTORS Foreign currency debtors allows customers (debtors) to hold transactions in a nominated currency. The currency is specified on the customer master file. Note: Once the currency is specified for a customer it cannot be changed or maintained. Entries are posted to the customer's file in his/her nominated currency from the processes of:
• Sales order entry/invoicing • Credit note entry • Accounts receivable cash receipts entry (this includes on account cash distribution
and transfer) • Agency sales (shipment receipt) • AR journal entry
Implementation Masterfiles that need to be set up are currency codes exchange rates bank accounts company general ledger interface definitions customer All currencies that are to be used should be set up on the currency master file. (DD.CURRENCYMAINT) Exchange rates should be specified for these currencies and maintained as required. This is done using the exchange rate maintenance facilities maintaining the (A)ccounts exchange rate. (DD.EXRATEMAINT) Foreign currency bank accounts should also be established (DD.BANKMAINT) to hold the transactions generated from the accounts receivable cash receipts process.). Note: Each bank account should be given a unique general ledger account code. The general ledger interface accounts needed for foreign currency processing should be set up in the company general ledger code file. (DD.GLCOCTLMAINT). These accounts should first be set up in the general ledger account file. The general ledger accounts that are required are:
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Customers who are to trade in foreign currency should be established. (DD.CUSMAINT). The currency that they are to trade in is noted on their master file. A system parameter must be set in the company parameter file to specify that foreign currency debtors is being used. Sales (invoicing) Sales orders are recorded in the same way as native currency orders except that the prices are in foreign currency (taken from the customer master). Invoices are produced and posted in the currency of the order. AR cash receipts Foreign currency accounts receivable cash receipts processing is done using the same process as for native currency accounts receivable cash receipts processing. The bank account nominated for each transaction must be for the same currency as the customer from whom the cash is received. All entries are recorded in foreign currency. Deposit forms are printed by bank account which means that they will only contain transactions with their currency. These are printed automatically as the receipt process is exited, or on demand depending on how the parameter is set in the cash receipts process (DD.ARCASHREC). AR "On Account" cash On account cash is distributed in the usual manner. For foreign currency customers however, it is the foreign currency value that is distributed. On account transfers can only be done between customers with the same currency flag. AR Journal Entries The standard accounts receivable journal facility (DD.ARJNLENTRY) is used to process accounts receivable journals for customers that have their account held in a foreign currency. The customer currency is displayed alongside his/her name to indicate the currency that the entry is being done in for accounts receivable posting purposes. The amount is coded in foreign currency but is converted to native currency for the general ledger posting. The conversion is done using the exchange rate from the accounts exchange rate file. Write off small AR balances The process to write off small balances held on the customer file (DD.ARWRITEOFF) is run by currency. The balances that are written off are converted to native currency for general ledger posting purposes using the accounts rate from the exchange rate file. Write off small transaction balances The process to write off small transaction balances (DD.ARTWRITEOFF) works in the same manner as the process to write off small AR balances.
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AR Enquiry Enquiries are initially displayed in the currency of the customer referenced. However the enquiry can be converted to native currency using the (C)urrency option at the foot of the enquiry screen. On account transactions and payment history enquiries are held only in the currency of the customer. If these options are selected the currency displayed will always be the customer’s currency even if the enquiry was being viewed in native currency when the option was selected. AR Summary and Open Item Trial Balances All reports break on currency in addition to branch. It is also possible to selectively run the reports by currency in addition to branch. The reports include:
Unrealised and Realised Exchange Gains and Losses When an initial entry is put to a customer’s account the entry is posted to the general ledger using the file accounts exchange rate. No unrealised or realised exchange gain or loss occurs at this point. However, as the entry is held in the AR file in foreign currency any changes to the accounts exchange rate will cause unrealised exchange gains/losses to occur. As exchange rates are changed the transactions held in the subsidiary file (debtors) are revalued and the debtors control account in the general ledger is adjusted to reflect the updated native currency value. The adjustment is posted to the unrealised exchange gain/loss account as specified in the company general ledger code file. When transactions held in the debtors subsidiary file are matched with either cash received or AR journal entries the value (or part value) held as an unrealised exchange gain or loss for the initial transaction is transferred to the realised exchange gains/loss account (as specified in the company general ledger code file) Note: If only part of a transaction is matched, an entry is created to transfer only the
portion of the unrealised exchange gain/loss. Only the portion that is applicable to the entry being done is transferred.
Amounts held in the unrealised exchange gain/loss account therefore reflect exchange rate changes to transaction amounts that are still held in the subsidiary ledger (debtors). These only become realised when paid or cleared.
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ENQUIRIES AND REPORTS The accounts receivable reports can be run either in local (system) currency or in the currency defined on each customer’s file. The current exchange rate ((A)ccounts) is used to convert overseas currency transactions into local currency values unless the report is taken from the end of month files in which case the EOM exchange rate is used. (Note: EOM copies of the exchange rates must be done to hold the EOM values. The tasks DD.XRATEAP, DD.XRATERAR and DD.XRATEP must be included in the EOMCOPY control task list to create the EOM files DD.XRATEAPEOM, DD.XRATEAREOM and DD.XRATEPEOM).
Accounts Receivable Enquiry The accounts receivable enquiry facility (DD.ARENQUIRY) provides the means to enquire on the state of a customer's account. After selection of a customer all the outstanding transactions are displayed. Detail for each transaction listed covers: • Date • Transaction type • Reference/invoice # • Customers purchase order # • Amount In addition the balance owing is aged and the summary ageing shown (including the on-account balance.) From this screen further options are available including: • On-account detail • Payment detail • Diary notes • Write diary notes • Instalments • Invoice display • Service management contracts • Customer contacts • Order enquiry } available if program • Service management call enquiry } parameters are set • Create date of the customer • Journal entry detail • Value of orders in pick The (F)unction option allows specific invoice numbers or invoice dates to be entered. This allows the operator to go directly to that part of the enquiry. The (F)unction option also allows the user to see all invoices for the customer or only those invoices with a balance still owing.
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Note: Paid invoices or matched invoices are held on the customer file for a length of time determined by the setting of the program parameters.
Other information provided by the enquiry covers: • Customer branch • Representative • Debtor account • Credit limit • Phone number • Back order amount - (available if the program parameter is set) • Pseudo orders – closed service calls that are yet to be billed using consolidated invoicing For customer accounts held in foreign currency an option is available to view the transaction detail in either local currency or foreign currency. The currency flag is shown alongside the customer identification. Values are converted using the system exchange rate table.
Open item trial balance The accounts receivable open item trial balance (DD.OITB) is a report that displays the current status of each debtor account in detail. The report may be run by currency or by branch. Detail for each debtor includes all transactions not purged with their reference and amount. The report is normally part of month end and is in effect a print of the debtors statements. The age of each account is also shown.
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Summary trial balance There are four options for accounts receivable summary trial balance prints: Summary trial balance DD.ARSUMMTB Branch accounts receivable summary DD.ARBRSUMM Summary trial balance (12 mth) DD.ARTB Summary trial balance (AR period) DD.ARTBYYMM Summary trial balance with instalments DD.ARITB The summary trial balance lists by branch the balance owing for each customer. The debt is aged, current, one month, two month and three months +. On-account cash is shown as a separate figure. The report can be selectively printed: • By accounts with balances older than a specified age • By currency • By branch The report is totalled by currency. The branch accounts receivable summary report is a listing by branch of the debtors balances in total. In effect it is the branch totals of the summary trial balance and may be used to balance the subsidiary ledger to the general ledger when customers are held in many branches. The summary trial balance report for 12 months is a version of the summary trial balance except that the ageing is taken out to twelve months and not grouped at 3 +. The summary trial balance report (AR period) is by accounts receivable transaction period, rather than by age.
Accounts receivable history report The accounts receivable history report (DD.ARCUSTENQ) allows the invoice detail to be listed for a specified customer between specified date ranges. Detail provided by invoice covers: • Invoice date • Amount • Payment date
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On-account transfer history list The on-account transfer history report (DD.OATFRLIST) lists transfers of on-account cash from one customer to another. The report is by customer and shows who the transfer was to and the amount. The report can be run for selective customers and date ranges.
On account list The report DD.OALIST is a selected list of amounts held “on account” for customers. Detail covers each on account amount held, by reference.
Customer ABC analysis The customer ABC analysis (DD.ABCCUST) provides a list of customers sequenced by turnover for a rolling 12 month period. Gross profit and the gross profit percentages are also shown. The report can be run by branch and exclude customers with less than a specified 12 month sales value.
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