Receivables

The Receivables application offers activities related to your company's self-managed charge accounts. Receivables are based upon a monthly billing period. Each consecutive period is sequentially numbered and transactions processed during the month are assigned to the period where applicable. Most Companies prefer doing billing on the same day every month such as the 1st or 25th, for example. For this reason, the actual length in days of each period can vary based on the number of days in a given month. A schedule is typically established prior to your company's live date and is based upon your preferences. It is not possible to run more than one concurrent billing cycle per company. It is possible to assess finance charges on a different date from the date your billing period ends, however.

Payment Entry

Payment Entry is used to enter multiple payments on account as a batch opposed to doing so individually (single payments may be entered through Point of Sale, Payments). This would most often be used in a situation where checks (payments) have come in the mail and are being entered for later posting. "Posting" is the process that applies payments to unpaid items. Payments may also be entered directly in the Posting activity.

Posting

Posting applies payments to debit items such as account charges, finance charges, and adjustments. Payments may be entered from this area or instead by using the Payment Entry (see above) or Payments (found in the Point of Sale application area). Posting may not be reversed and occurs immediately when payments are applied to an account.

Credit Adjustment

A credit adjustment is used to place a credit entry on a customer's account and is usually done to correct a mistake, remove a finance charge, etc. Credit must be applied to debit items (charges, etc.) using the Posting activity.

Debit Adjustment

Debit adjustments are debit entries made to a customer's account and are usually done to fix errors such as incorrectly entered payment amounts, etc. Existing credit items can be applied to the debit adjustment from the Posting activity to resolve problems.

Close Cycle

This area is used to schedule the close of a billing period (cycle).

Statements

This activity is used to print statement documents and invoice reprints. Statement documents are created when the billing cycle is closed, so this activity doesn't build the documents, it just prints them. Statements can be viewed or printed individually from the Documents tool.

Special Topics

This section provides additional topics related to Receivables that may be useful to you. These topics include:

Getting Started

Customer Settings and Billing Preferences

Statement Delivery and Processing

Statement Formats Compared

Statement Discounts

Finance Charges

Statement Examples

Revolving Charges

Understanding Aging and Receivables

Aging and Receivables

Customer accounts and jobs, if job billed, maintain aged balances for open receivables activity. These balances are based on activity during billing periods as opposed to months and are not directly related to the actual age of any particular invoice (sale). Aging for balances varies based upon the type of account details maintained. Open item type accounts maintain details that "balance forward" accounts don't. Balance Forward accounts maintain balance totals only and the individual payment status of any particular invoice (sale) is not maintained. All accounts, regardless of type, maintain five balances that relate to aging:

1.Current Balance

This only includes new activity for the current billing period which has neither been aged or billed to a customer. Since these items have not yet been billed, this balance could equally be described as "new" as opposed to "current." Some aged balances and items (see below) can still be considered current even though they have been aged.

2.Past Due 1

This includes activity which has aged once, so it represents items or balances that have been billed but not yet paid. It's important to point out that the open items or balances in this level of aging are not entirely or necessarily truly "past due." They are aged in anticipation of the next billing only, and if paid, could still be considered "current." If these items or balances are not paid before the next period, they will be aged further and possibly be assessed finance charges. The actual age of these items can vary from anywhere between 1 and 31 days.* This balance only truly reflects an actual "past due" figure on the last day of your billing period after all payments and credits have been applied to balances and items.

3.Past Due 2

This aging period includes activity which has aged twice. This is the first truly "past due" balance at the beginning of a billing period. Items and balances reflected by this total could vary anywhere from between approximately 29 and 62 days in age.

4.Past Due 3

This aging period includes activity which has aged three times. Items and balances reflected by this total could vary anywhere from between roughly 59 and 92 days in age.

5.Past Due 4

This aging period includes activity which has aged four or more times. Items and balances reflected by this total could reflect activity from around 92 or greater days in age. Once items or balances reach this final "bucket," they are aged no further. Finance charges, if used, will continue to accumulate on these balances unless the status of the account or finance charge percent is modified to no longer do so.

*Actual days will vary based upon the transaction date, billing date your company uses, and the time of year.

For Balance Forward accounts, existing balances that are not paid are moved to the next consecutive aging period at the close of each billing period until they have aged into the last (4th) past due period. Once they reach this period, no further aging is done.

For Open Item accounts, balances are based upon the totals of the open items. Each open item maintains the billing cycle number that it originated with. These cycles determine the aging for each open item as it relates to the current cycle number. For example, if the current cycle is #211 and the open item was a sale processed during cycle #209, it has aged three (3) times and will be included in the Past Due Cycle #3 totals (typically, this includes items that are anywhere between 91 and 120 days past due).

Open item accounts that use POS Invoice Terms don't age any differently from other accounts, even if the due period is greater than the billing period in days. The "due date" for POS Invoice Terms is used for determining whether an open item is eligible for finance charges or not. Finance charges are calculated on the entire invoice amount if not paid. Finance/Service charges are not pro-rated by the number of days overdue. Again, invoice terms don't affect aging.

A Note About Credits

Credits are not aged. It is possible for balance forward accounts to maintain a "current" balance that is negative. Open Item accounts never reflect or carry a credit balance. Credits applied to balances or open items reduce the aging buckets accordingly.