Classic - Accounts Receivable

Receivables Overview

The process of working with receivables is generally handled in two separate areas of Successware, the Receivables Manager and the Billing Account History screen. Both allow you to access customer accounts, apply payments, and include finance charges and other related activities.

Receivables Manager

The Receivables Manager is generally used to perform receivables activities that relate to all billing accounts. Additionally, transactions that are not related to any specific billing account, such as miscellaneous cash receipts, are handled in the Receivables Manager.

Functions normally performed from the Receivables Manager:

• View all accounts, (Ctrl+Enter)
• Add New Billing Accounts
• Search for a specific billing account,
• Age all accounts,
• Post finance charges for all accounts,
• Print statements for all accounts, and
• Print a statement for one account.
• Record Miscellaneous Cash Receipts

Billing Account History (F4)

The Billing Account History screen is used to perform receivables transactions that pertain to specific billing accounts.

Functions normally performed from the Billing Account History screen:

• Post cash receipts,
• Enter adjustments,
• Print an individual statement,
• Age an individual account, and
• Apply finance charges to an individual account.

Receivables Manager

Viewing Receivables in the Receivables Manager

The Receivables Manager allows you to display:

• Accounts,
• Invoices,
• Payments, and
• Adjustments.
  

Each of the item types can be searched using 5 common fields  They are:

• Address,
• Phone#,
• Last Name,
• Company, and
• Billing Acct ID.

In the Invoice view, you can also search by Invoice No and Job No.

In the Pmts/Adj view, you can search by Pmt/Adj Reference.

You can view all records within a view by pressing Ctrl+Enter.

You can further filter results by choosing to display only Open Items, Overdue Items or Out of Balance Items.

Click on any item and press F4 or Enter to open the Billing Account History for that customer.

Searching in the Receivables Manager

1. Click on the type of item for which you want to search. 

                 

2. Enter the search term in the desired field.
3. Press Enter to perform the search (or press Ctrl+Enter to return all records of the chosen type).
4. Further limit the result set by clicking on Open Items, Over Due or Out of Bal to see only items that fit those criteria.

                 

Control Menu Options in the Receivables Manager

Right-Clicking in the results grid of the Receivables Manager will open the control menu which will allow you to perform a number of functions:

Menu Options	Function
View	Selects which view you wish to use for the Receivables Manager; Accounts, Invoices, or Pmts/Adj.
Filter Items	Selects the items to include in the display; Open, Overdue and Out of Balance.
Open Account	Opens the Billing Account History for the selected account.
New Account	Adds a new billing account.
View Allocations	Displays items that have been allocated to the selected item.  This option in only available when viewing Invoices or Pmts/Adj.
Review GL	Displays the posted General Ledger entries for the selected item. This option is only available when viewing Invoices or Pmts/Adj.
Fix Item Balance	Corrects allocations on items that are found to be out of balance.  This option is only available when using the Out of Bal filter option.
Post Cash Receipts	Allows you to post cash receipts for the selected account or to post a miscellaneous cash receipt (a receipt not related to an outstanding receivable item or account)
Age Accounts	Reads transactions and moves them to the appropriate aging category (over 30, 60 or 90 days) based on the invoice date.
Post Finance Charges	Calculates and posts finance charges for all billing accounts.
Print Batch Statements	Prints statements for all accounts with open items.  This option is only available when viewing Accounts.
Print Statement	Prints a statement for the selected account.  This option is only available when viewing Accounts.
Preview Statement	Displays a statement for the selected account.  This option is only available when viewing Accounts.
Recalc Account Totals	Reads items for the selected account and updates the account’s summary fields.
Reconcile	Runs the reconcile utility. The reconcile utility compares general ledger balances to the detail and reports any discrepancies.
Report	Creates a grid report.
Open	Displays a sub menu that allows you to open (billing) Account details, (billing) Account History, or (billing account) Notes.
Close	Closes the Receivables Manager.

Creating a New Billing Account from the Receivables Manager

Typically, you will add billing accounts as you add customer locations to the system; either as a carbon copy of the location or by adding different billing accounts

1. Right-click in the grid area of the Receivables Manager and select New Account, or press Insert. The New Billing Account form will open in add mode.

2. Enter the information in the appropriate fields.

Field Descriptions

Field	Description
Acct #	Displays the account number for the selected billing account.  You can accept the assigned number, or enter your own number.  If you change the assigned number, it must contain at least one alpha character.
Service Cont	Displays the name of the person who typically contacts you for service.
A/P Contact	Displays the name of the person you contact regarding their invoices from you.
Locations	Displays a listing of locations associated with the selected billing account.  If you wish to identify or add locations for the billing account, right-click and select either Add location, or New carbon copy location.
Rating	Allows you to assign a rating to your customer accounts.
Tax ID#	Enter Tax ID numbers in this field.
Terms	Enter the payment terms for the account in this field.
Pmt Mthd	If you select a credit card type or bank draft, enter the card or account number in the following fields.
Salesperson	If you assign a salesperson to the account, select the assigned salesperson from the drop-down list.
Credit Limit	If you assign a credit limit to the account, enter that limit here.
No Finance Charge	Check the additional boxes to determine whether or not this account should receive finance charges or statements, is a bad risk, should receive solicitations or happy checks (follow up calls). Note: The Bad Risk checkbox will cause the Customer's Rating, whether it is good or bad, to blink in red at the top of the Customer Information screen and at the top of the Call Taking form.
No Statement
Bad Risk
Do Not Solicit
No Happy Checks
General Billing Account	Mark this checkbox to indicate that the new account is a general billing account.  A general billing account is one that is not assigned to a particular location and can be selected for jobs and invoices for any location.  Examples would be equipment manufacturers or insurance companies.
Alternate Address	Click the alternate Address button if a you wish to add a separate Billing address for the customer which will be used in certain situations. The system will open a data entry form where you can add enter the alternate address. If you wish to use this address on billings, be sure that the Alternate Address checkbox is selected. This is helpful for customers who may live in a location part of the year and want billing sent to another address during other parts of the year.

3. Click Save to save the new billing account.

Miscellaneous Cash Receipts

You will use miscellaneous cash receipts to record money received that is not related to an accounts receivable item or billing account.  Examples would be payment received from onsite vending machines, worker’s compensation refunds, or cash refunds from a vendor.

Recording the receipts in this manner will include them in the un-deposited receipts cash box so they can be reconciled and deposited correctly.  You WILL NOT do a journal entry to record these receipts.  Journal entries will not update the Account Register.

Since miscellaneous cash receipts do not affect Accounts Receivable you must select a Receipt Distribution Code, which will determine where the receipt will post in the General Ledger.  The debit will post to cash and the Receipt Distribution Code will determine the offsetting account.

Receipt Distribution Codes

Receipt Distribution Codes must be defined for Miscellaneous Cash Receipts.  Miscellaneous Cash Receipts are used to record incoming cash that is not applied to Accounts Receivable.  Since Miscellaneous Cash Receipts are not applied to receivables, the Receipt Distribution Code is used to tell the system where to post the entry. Build a code that describes the reason the funds are being received and associate that code with the GL account to which you want the item to post. Receipt Distribution codes are found in the Accounting volume of the Reference Library.

Double click on Receipt Distribution Code and press Ctrl+Enter to bring the table into edit mode. Press Insert to add a new code.

Column Name	Description
AdjustCode	Enter a code of up to six character to identify the adjustment code
GL_Account	Choose the General Ledger account to which you want to apply the transaction.
SubAccount	If the General Ledger account you of chosen has subaccounts, select the sub account to which you want to post.
AdjustCodeDesc	Enter a description of the adjustment code.
IsActive	Enter an X in this field to make the item active. If an item is not marked active, it will not be visible or available for users to choose from the list.

 

Entering a Miscellaneous Cash Receipt

1. Open the Receivables Manager
2. Right-click in the display grid and select Post Cash Receipts.
   The Cash Receipt form will open.

3. Use the mouse or spacebar to select Miscellaneous as the method for applying the payment.  It is very important that you select Miscellaneous! This selection tells the system that you are not applying the payment to a receivables or a billing account.

Field	Description
Cash Box	Defaults to the register account that is marked as the default receipt account.
Date	Enter the date you wish the payment to post to the General Ledger.
Amount	Enter the amount of the receipt.
Comment	Optional field for your notes.
Payment Method	Use the drop-down list to select the type of payment (i.e. cash, check, Visa, etc.), then complete the other fields as appropriate.
Since the receipt is not applied to accounts receivable, the system will open a data entry grid where you will select distribution codes to indicate how to post the entry.  Press Insert, or right-click and select New Item to enter the distribution information.  Complete the distribution grid as follows:
Adjust Code	Select the appropriate code from the drop-down list.
Acct	The General Ledger account will default based on the adjust code selected.  This field cannot be changed.
SubAcct	If the General Ledger account has sub-accounts you must select a sub-account (using the drop-down list).  If you enter a sub-account when setting up the adjustment code, the sub-account will default.
Dept	Select the appropriate department from the drop-down list.
Amount	Enter the amount of the receipt that you wish to post for this line item.  You can split the distribution by selecting other codes and/or departments.
Memo	Optional field for your notes.

NOTE: If you wish to split the distribution between multiple distribution codes or departments, press Insert to open another line and complete the fields.  Continue until the full amount of the receipt has been distributed.

4. When all fields have been completed, click Post.  The receipt will debit the cash account and credit the accounts assigned to the adjust code(s) used.  There will be no record of it in the Receivables Manager or any billing account.  The receipt will appear in the cash box register account used for undeposited funds where you will reconcile it to create a deposit.

Billing Account History

Billing Account History Features

In addition to the “normal” processing of receipts, adjustments, finance charges, etc., the Billing Account History screen has other features to help you view, and maintain, billing account transactions.  They are:

• Display transactions by location,
• View allocations,
• Allocate,
• Review GL, and
• Reverse receivable.

You can access the Billing Account History through either of the following methods:

• From the Receivables Manager—locate the account and press Enter or F4

-OR-

• Press F4 from any active customer window

The Billing Account History screen displays all activity for the selected account.  These transactions can be viewed using the following filter indicators:

Select	To display
OPEN	Open items.
OVER	Overdue items.
INV	Invoice type transactions.
PMT	Payment type transactions.
ADJ	Adjustment type transactions.
REF	Refunds.
FIN	Finance charges.
NEG	Items that have been negated (reversed).
LOC	Transactions for a selected location for the billing account.

You can also use a combination of filters to achieve tailored results.  For instance, if you wish to display only open invoices you would click on Open and then Inv.

Displaying Transactions by Location

1. For accounts with multiple locations, you can filter by location using the LOC Click on the filter and select the location for which you wish to view transactions.
2. To display all locations again, click on LOC and select Off.

Control Menu Options in the Billing Account History

Right-clicking in the Billing Account History screen will open a control menu that gives you the following options.

Menu Option	Function
Receipt	To post a cash receipt.
Adjust	To enter a debit or credit memo.
Allocate	To allocate a previously unapplied item.
Statement	To print an individual statement for the billing account.
Age Account	To age the current billing account (rather than all accounts).
Apply Finance Charges	To apply finance charge to the current billing account (rather than all accounts).
Filters	To select the filters that are also available at the top of the form.
Open	Displays a sub-menu where you can select to open (billing) Account details, the Job associated with the invoice, the Invoice form, or (billing account) Notes.
Close	To close the Billing Account History screen

Printing Customer Statements

Successware allows you to print statements that identify open items on a customer’s billing account.

• You must use the Receivables Manager if you want to print statements for all accounts.
• You can us either Receivables Manager or the Billing Account History if you want to print a statement for one account.

To Print Statements for All Accounts

1. Press Ctrl+Enter from any search field in the Receivables Manager to list all accounts, then select either Open or Overdue to view only the accounts with an open balance.
2. Right-click in the grid and select Print Batch Statements.  The system will then open the Statement Dialog box.

The Statement Dialog allows you to choose the type of Statement to generate and allows you flexibility in determining which customer account to include or exclude.

3. Choose whether to include all accounts (batch statements) or print for a single user selected account. You can also choose to run the statement using a customer Last Name or Company Name. If you choose to run by name, the % wildcard character is available. (Ex. %Mart would return statements for both WalMart and KMart.)
4. Choose the Statement Type that you would like to print.

• Open Item – Any item with an open balance (or an unapplied balance) which is due prior to the end date specified for the statement. The From date is ignored when running an Open Item Statement.
• Balance Forward –The beginning and ending statement dates are used to determine which items will be included in the statement.  A “balance forward” is displayed for the account as of the beginning statement date entered, then all new account activity which was entered on the account between the beginning and ending statement dates is listed. Finally a balance as of the Ending Date range is displayed..

5. Choose the type of accounts which you want to appear or which you want to exclude in the statements generated. Use a checkmark to include accounts with:

• A credit balance
• A zero balance
• Any activity during the statement period
• No Past Due Balances- allows you to include or exclude accounts that have no past due items (Accounts must be aged before this option will offer accurate results.)

6. Choose either Print or Preview to generate the statements.

To Print a Statement for One Account

1. From the Receivables Manager—locate the billing account for which you want to print a statement, right click and select Single Statement.

-OR-

From the Billing Account History screen—click on Statement located at the bottom of the form, or right-click and select Statement.  Double-click on the date you wish to use for the statement date.

A list of items that will appear on the statement will open. Right click and choose Print or select the Print button.

2. The system will then open the Statement Dialog box with the selected Account number already recorded.

The Statement Dialog allows you to choose the type of Statement to generate and allows you flexibility in determining which customer account to include or exclude.

3. Modify the date range of the statement if necessary.
4. Choose the Statement Type that you would like to print.

• Open Item – Any item with an open balance (or an unapplied balance) which is due prior to the end date specified for the statement. The From date is ignored when running an Open Item Statement.
• Balance Forward –The beginning and ending statement dates are used to determine which items will be included in the statement.  A “balance forward” is displayed for the account as of the beginning statement date entered, then all new account activity which was entered on the account between the beginning and ending statement dates is listed. Finally a balance as of the Ending Date range is displayed..

5. Choose Print or Preview to generate the Statement.

Recording Payments

Recording a Receipt

Customer payments that are received at the time of service are generally recorded as a payment when posting the invoice.  Customer payments that you receive after an item has been invoiced, payments made via multiple methods of payment or payments for which you have no invoice (such as deposits), are posted in the Billing Account History screen.

You will use Cash Receipts to post any kind of customer payment.  They are considered “cash” receipts because the transactions will update a “cash” type account in the General Ledger.

Allocating Items to a Customer's Billing Account

If a payment item or an adjustment is not allocated to an open item on the customer's account, the payment or adjustment will appear as an open item. If the payment or adjustment was intended to pay an open item, and it is not allocated to that open item, the balance on the account may be zero, but both the unpaid item and the payment or adjustment will appear as open items when generating statements and for aging purposes.

There are 4 ways that a payment or an adjustment can be allocated or "applied" to a customer account:

Auto Allocation- An auto allocation is the easiest method of allocation and is used when the receipt amount and invoice balance are equal. In order for auto allocate to be available as an allocation option the following conditions must exist:

• The open item that is being paid must be selected before the receipt or adjustment is recorded. This can often be done by simply selecting the Open filter in the Billing Account History screen.
• The amount of the payment or adjustment must EQUAL the balance due on the selected item.
• You must TAB through the payment or adjustment form. This is due to the fact that Successware waits until you have EXITED the Amount field to confirm that the payment or adjustment amount and the open balance are equal. If they are the Auto Allocation option is made available. If you never enter (and therefore never exit the Amount field) the Auto Allocate option will not be made available.

Auto With Adjustment- This option allows you to mark an open item as fully paid by recording a payment and an adjustment through the same screen. This would be helpful, for example, when you receive a $500 payment for a $501 invoice and want to write off the $1 balance due .It also could be used when you receive a check from a finance company to pay an invoice, but the finance company fee is already taken from the check total. In this case you could record both the check amount and the finance company fee at the same time. Both the payment and adjustment will appear on the customer account and show that they were allocated to the open item.

In order for the Auto with Adjustment option to be made available to you the following conditions must exist at the time that you post the receipt:

• The open item that is being paid must be selected before the receipt is recorded. This can often be done by simply selecting the Open filter in the Billing Account History screen.
• The amount of the payment or adjustment must LESS THAN the balance due on the selected item.
• You must TAB through the payment form. This is due to the fact that Successware waits until you have EXITED the Amount field to confirm that the payment is less than the open balance of the selected item.

Manual Allocation- In situations where the amount of the receipt or adjustment and open item are not equal or you do not want to adjust off the balance due you will need to manually allocate or apply the payment or adjustment to the open items on the account.

Unapplied- If the item which you have received payment for has not been entered into receivables yet or you are not sure which item the customer wants to pay, you can leave a payment Unapplied. Once the item to be paid is entered or you are sure which item was intended to be paid you can allocate the item at that time. Unapplied items can only be allocated from within the customer's Billing Account History

One special type of Unapplied receipt is a Customer Deposit. Unlike a regular unapplied item, customer deposits CAN be applied from within the payment option on an Accounts Receivable Invoice.

Posting a Cash Receipt

1. Open the Billing Account History screen for the appropriate billing account.
2. If you are entering a receipt for a specific invoice, highlight the invoice.

NOTE: If the receipt is for multiple invoices, or unapplied, you do not need to select a particular invoice.

3. Click on Receipt located at the bottom of the Billing Account History You can also right-click and select Receipt, or press ALT+1.  The Cash Receipt form will open.
4. Using the mouse or spacebar, mark the radio button to indicate how you want to apply the payment:

• Apply to invoice - to indicate that the payment is applied to the selected invoice. If you selected an invoice prior to opening the Cash Receipt form, this will be the default.
• Apply to account - to indicate that the payment is applied to the selected billing account.  (It may be distributed to multiple invoices or adjustments.)
• Customer deposit - to indicate that the payment is a deposit received for work to be performed in the future.  Payments marked as “customer deposit” can be applied to the invoice when it is posted later.
• Miscellaneous - to indicate that the receipt is NOT for an accounts receivable item.  See Miscellaneous Cash Receipts for more detail.

5. Complete the following fields:

Field	Function
Cash Box	Defaults to the register account that is marked as the default receipt account.
Date	Enter the date you wish the payment to post to the General Ledger.
Amount	If you selected an open invoice prior to opening the Cash Receipt form, the amount will default to the invoice balance.  Accept the amount or enter the actual receipt amount.  If you are entering a receipt for multiple invoices, enter the entire amount you received.  You will distribute it later.
Comment	Enter any comment that you may want to see in the future about the payment. It is recommended that whenever you receive a check payment that you record the check number in the comment field along with your notes.
Payment Method	Use the drop-down list to select the type of payment (i.e. cash, check, Visa, etc.), then complete the other fields as appropriate.

6. Using the mouse or spacebar, select the radio button that indicates how you wish to allocate the receipt.

• Auto allocate payment - if the payment amount is the same as the invoice balance, the system defaults to Auto allocate payment.  The system will automatically apply the receipt to the selected invoice when you post.
• Auto with adjustment - is only available when entering payments where the amount is less than the invoice balance.  This option allows you to enter an adjustment at the same time you apply a payment. Selecting this option will require you to complete additional fields.
• Manual allocation - if the payment amount is different than the invoice balance, the system defaults to Manual Allocation.  You will allocate the payment after you post.
• Unapplied - can be selected any time and will post the payment to the customer’s account.  The system will apply the receipt to the account as an open item when you post.

7. Press Post to save the payment.

Manually Allocating Payments

If you selected to manually allocate a payment, the Manual Allocation window will open after you post. Manual Allocation is used to tell the system how to apply a receipt when the payment amount does not match the balance of the item for which you are entering the receipt, or when the receipt is for multiple transactions.

1. After posting a payment, the Manual Allocation window will open.

You will see the Billing Account History screen.  Notice that the bottom portion of the screen only displays the open items for the account, and that the system states you are posting a transaction (i.e., Posting PMT: Check $1500.00).

The bottom of the form will display the balance of the payment that is still un-allocated in green.

2. Move through the items allocating the payment as follows:

Press	To
Enter	If the unapplied balance is greater than the item’s balance, pressing Enter will fully “pay” the item.  If the unapplied balance is less than the item’s balance, pressing Enter will apply the full un-applied amount to the item.
Alt+Enter	Alt+Enter will place the line item in edit mode where you can enter the amount you wish to apply to the item in the Allocate column.
Del	Pressing Del will clear the allocation.  If an incorrect amount is in the Allocate column for the item, clear the allocation and either automatically or manually allocate the item again.
Ctrl+End	Pressing Ctrl+End will auto apply the remaining balance.  The system will automatically allocate the un-applied balance starting with the oldest item.

3. Once you have completed the allocations, click Post.  If there is still an un-applied balance, the system will display the following prompt: “The item is not fully allocated, continue & post?”

• Clicking Yes will post the item, thus leaving the un-applied balance as an unapplied payment.
• Clicking No will return you to the allocation form where you can continue to allocate the payment.

Allocating Open Items

If you choose to mark a payment as unallocated, it will appear in the Billing Account History as an open item.

To allocate open items complete the following steps:

1. Highlight the item that you wish to allocate.
2. Click on the Allocate button located at the bottom of the Billing Account History screen, or right-click and select Allocate.
3. The system will display all open items for the billing account in the allocation form.

You will still see the Billing Account History heading on the screen.  Notice that only the open items are displayed and the system states that you are posting a transaction (i.e. Posting ADJ Credit Memo 10011  $25.00).

The bottom of the form will display the balance that has not been applied.

4. To apply the full amount of the item you are allocating (or, if the highlighted open item is less than the item you are allocating, the full invoice balance), press Enter.

The system will insert the allocation amount in the Allocate column.  You can also edit the allocation amount if desired.

5. Once the allocation is complete, click Post.  If the item is still not fully allocated, the system will ask you to confirm that you wish to post the balance “on account”.

Note: If you choose to mark a payment as unallocated, it will appear in the BILLING ACCOUNT HISTORY as an open item. Open items will age and show up on customer statements.

Making a Payment with an Adjustment

Making an adjustment with a payment allows you to apply a payment to a billing account item and cancel any additional amount that is owed. This is useful when payment for an invoice is being made by a finance company that withhold a portion of the payment as their fee. The balance remaining on the open item once the payment amount is applied is charged against an Accounts Receivable adjustment code that you will choose

1. Open the Billing Account History screen for the appropriate billing account.
2. Highlight the item to which you want to apply a payment.
3. Right-click on the item and select Receipt or Press Alt+1.
4. Choose to Apply the payment to the invoice.

5. Enter the Amount of payment, as well as other payment information.
6. Enter a Comment which explains the fact that this is partial payment or other note you would want available in the future when viewing this transaction.
7. Choose Auto with adjustment. You must complete the adjustment portion of the screen.  That section will only be available when the Auto with adjustment selection is made.

7. Complete the fields as follows:

Field	Function
Adjust Code	Select the AR Adjustment code that best represents the reason that you are removing the remaining balance due from the open balance of the item.
Adjust Amount	The system will calculate the difference between the invoice balance and the payment amount to determine the amount of the adjustment.
Acct	The General Ledger account will default based on the Adjust Code selected.  This field cannot be changed.
SubAcct	If the General Ledger account has sub-accounts you must select a sub-account (using the drop-down list).  If you enter a sub-account when setting up the adjustment code, the sub-account will default.
Dept	Select the appropriate department from the drop-down list.
Reference	Will default to the invoice number for which you are posting the receipt.  You can change the field if desired.
Comment	It is very important that you record a comment that explains why you have removed the remaining balance from the open item as this comment will be your reminder when you view this transaction in the future.

8. Click on Post to save the transaction. If manual allocation is the allocation mode, the system will display the allocation form so you can indicate how to apply the payment.  Otherwise, the system will post the receipt and return to the Billing Account History See the Manually Allocating Payments section.

Recording a Customer Deposit

Cash receipts from a customer can be recorded as a deposit. It is important that Customer Deposit is chosen, as opposed to merely applying the amount to the customers account. By marking the receipt as a deposit the deposit can be applied directly as a payment through the payment option on an Accounts Receivable invoice.

Note: When recording Customer Deposits, it is very important that you enter a note regarding the deposit in the Comment field of the Receipt form. This comment will appear in the AR invoice payment form when you apply the deposit to the invoice. If you have many deposits on record for a customer (such as a builder) you can use the comment to help you to identify which deposit is intended for which job.

1. Open the Billing Account History screen for the appropriate billing account.
2. Click Receipts.
3. In the Cash Receipts form, select the Customer deposit option.
   
4. Enter the required information regarding the payment amount and method.
5. Click Post to save the deposit.

Making Adjustments

Creating a Credit or a Debit Adjustment

If you make an error when posting an invoice, you can adjust (reverse) the invoice in the A/R INVOICE form and make the necessary corrections before re-posting it.  Adjustments that need to be made to an account later, either credit memos or debit memos, are posted from the Billing Account History screen.

You will use the adjustment feature to make changes to increase or decrease a billing account’s balance.  Adjustments are made for reasons such as customer refunds, “give backs”, or to record balances due do bounced check fees and even to put a balance BACK on a customer's account after an check used to pay an open invoice was returned as NSF..

To post an adjustment

1. Open the Billing Account History screen for the appropriate billing account.
2. If you are entering the adjustment for a specific invoice, highlight the invoice.

NOTE: If you are adjusting multiple invoices, or applying it to the account, you don’t need to select a particular invoice.

3. Click on Adjust located at the bottom of the Billing Account History You can also right-click and select Adjust, or press ALT+2.

The A/R Adjustment form will open.

4. Using the mouse or spacebar, mark the radio button to indicate how you want to apply the adjustment.

• APPLY TO INVOICE - this option is chosen to apply the adjustment to the selected invoice.  If you selected an invoice prior to opening the A/R Adjustment form, this will be the default
• APPLY TO ACCOUNT - this option is chosen to indicate that the adjustment is applied to the selected billing account.  (It may be applied to multiple invoices, other adjustments, or to the account.)

5. Using the mouse or spacebar,  mark the radio button to indicate whether the adjustment is a Credit Memo (to reduce the account’s balance), or a Debit Memo (to increase the account’s balance).

NOTE: If this is a customer refund, select the Credit for refund button. The refund adjustment code will automatically be entered in the Adjust Code field. If you are refunding an overpayment to a customer, you will not use this option, rather you will make a Debit adjustment to the account.

Field	Function
Date	Enter the date you wish to post the adjustment to the General Ledger.
Adjust Code	Select the appropriate code from the drop-down list.
Adjust Amount	If you are applying the adjustment to an invoice that has a balance, the amount will default to the invoice balance.  You can accept the amount or change it.  If the adjustment is unapplied, enter the amount.
Acct	The General Ledger account will default based on the Adjust Code selected.  This field cannot be changed.
SubAcct	If the General Ledger account has sub-accounts you must select a sub-account (using the drop-down list).  If you enter a sub-account when setting up the adjustment code, the sub-account will default.
Dept	Select the appropriate department from the drop-down list.
Reference	If you wish to use a reference ID, enter it here.  If you are applying the adjustment to an invoice, you may wish to enter the invoice number as the reference.
Comment	Enter a comment which identifies why you are lowering or raising the balance on the customer's account. If the Adjustment creates a balance on the customer's account, the comment will be displayed on statements that you generate for the customer.

• Using the mouse or spacebar, select the radio button to indicate how you wish to allocate the adjustment.
• If the adjustment amount is the same as the invoice balance, the system defaults to Auto allocate adjustment. The system will automatically apply the adjustment to the selected invoice when you post.
• If the adjustment amount is different than the invoice balance, the system defaults to Manual Allocation.  You will allocate the adjustment after you post.
• Unapplied can be selected any time and will post the adjustment to the customer’s account.  The system will apply the adjustment to the account as an open item when you post.

6. After completing all fields for the adjustment click Post

If the allocation mode is manual allocation, the system will display the allocation form where you will indicate how to apply the adjustment.  Otherwise, the system will post the adjustment and return to the Billing Account History screen.

Criteria for Reversing a Receivables Transaction

There may be times when a transaction such as a payment or an adjustment that has been made on a customer's account needs to be removed. This is referred to as Reversing the transaction.

You can reverse posted Accounts Receivable transactions only if they meet certain conditions:

• The transaction is in an open fiscal period.
• If the transaction is a receipt and the receipt has not been reconciled for deposit.
• The transaction doesn't have allocations. If it has been allocated, the allocation must be removed.
• The transaction is not an invoice.  Invoices must be adjusted in the Invoice
• The transaction was created in the Billing Account History (For instance, payments that were posted as part of an invoice must be reversed there.)

Reversing a Receivable Transaction

If you want to reverse a receivables transaction and it meets the requirements listed above:

1. Highlight the transaction you wish to reverse.
2. Right-click, select Reverse Receivable, and confirm that you wish to reverse the transaction.

If you wish to view transactions which have been reversed, select the NEG filter indicator in the Billing Account History screen and the transactions will be displayed.

Credit Memo Wizard

A credit memo is an AR invoice with a negative total. The Credit Memo Wizard is designed to guide you through the process of creating a credit memo. Although credit memos can also be entered manually, the Credit Memo Wizard includes these additional options:

• G/L Posting
• Returning parts to inventory
• Reversing paybase

You also can identify the reason for the credit memo and enter additional notes if needed.

The Credit Memo Wizard can be accessed from the Billing Account History screen or directly from the Invoice form.

Accessing the Credit Memo Wizard from the Invoice form:
1. Click the Plus Sign next to the Invoice# field.
2. Select Credit Memo from the listed options.

Accessing the Credit Memo Wizard from the Billing Account History screen:

1. Open the Billing Account History screen for the desired customer.

2. Right-click on invoice to be credited and select Credit / Refund

Using the Credit Memo Wizard:

1. Select the desired option if you wish to manually enter a credit memo or create a credit memo for the invoice.

2. Under Additional Options, you can choose to:

• Post to default G/L account for returns and allowances or choose the G/L account you wish.
• Return parts back to inventory.
• Reverse any paybase entries in payroll. This is used if paying piece rate.

3. After your choices are made, click Next.

4. Click the drop-down arrow to select the Credit Memo Reason.

Note: Credit Memo Reasons can added/edited from the Reference Library in the Customer Service Volume.

5. Enter details in the Credit Memo Notes field if desired.

6. Click Finish to create the credit memo.

7. Click Save and Post. The Posting Credit Memo screen will appear and allow you to confirm the actions that will happen.

8. Click OK to confirm posting.

The customer's billing account will reflect the fact that a credit memo was posted, and it will be allocated to the selected invoice.

Modifying a Credit Memo:

Once a credit memo has been created, it can be edited, printed and posted the same as an AR invoice. Individual lines on a credit memo can be for a positive quantity or a negative quantity, but the total amount must be negative or it cannot be posted.

Some functions that are handled by an AR invoice cannot be reversed by the creation and posting of a credit memo. These include:

• New or renewal activation of an agreement
  • A credit memo will not deactivate an agreement.
• Agreement Visit Completion 
  • A credit memo will not mark a visit as 'not completed'.
• Labor hours associated with timecard entries
  • A credit memo will not reduce the number hours on an employee's timecard.
• Agreement Periodic Billings
  • Individual credit memos can be issued, but multiple credit memos cannot be created at the same time.

Aging Accounts

Once accounts with an open balance have remained unpaid for a certain amount of time, you will want to be able to identify those open items for the sake of pursuing payment as well as assigning finance charges. Aging accounts reads the open items' transaction date (either invoice date or adjustment date), compares them against the current date and then classify the items as being 30, 60 or over 90 days overdue. These items are then displayed in the appropriate aging column in the Receivables Manager.

• To Age all accounts, you will age accounts from the Receivables Manager.
• To Age a selected billing account, you will open that account’s billing account history.

Aging All Accounts from the Receivables Manager

Successware allows you to update all of your accounts with their current aging status at once from the Receivables Manager. This action should be performed before you apply finance charges to your receivables accounts.

1. From the Receivables Manager, right-click in the grid and select Age Accounts.
2. Successware will display the following prompt: “All users must be out of receivables while accounts are aged.  This may take a while.  Continue?”  Make sure that no other users have receivables open and confirm.  This includes invoicing through customer service.
3. The system will age the accounts and return to the Receivables Manager.

Aging an Individual Billing Account

If as a practice you do not apply finance charges to all customer's Successware allows you to apply finance charges to a single billing account. In relation to this you can also age an individual account, identifying items on that customer's account as 30, 60, or over 90 days old, without affecting your other receivables customers.

To age a single account:

1. Open the account’s billing account history. by searching for the customer in the Receivables Manager and then pressing F4 or Enter.
2. Click on the Age indicator located at the top of the form, or right-click and select Age Account.
3. The system will display a calendar.  Double-click the date you wish to use as an "as of date" for aging, then click on Post.  The account will be aged accordingly.

Adding Finance Charges

Adding Finance Charges to Accounts

Successware allows you to add finance charges to the accounts of your customers who have overdue balances on their accounts. Generally a finance charge is not applied until a customer is at least 30 days overdue; however you can control this in your Finance Charge Setup  

At the General Ledger level, finance charges great an AR balance due and the countering GL entry posts to the Default Account that you have identified for Finance Charges. Finance charges are always posted as revenue to department 00 (Administrative) and should be reversed against that department as well.

There are two ways that you can apply finance charges in Successware.

• You can calculate finance charges for all accounts in the Receivables Manager.
• You can calculate finance charges for one account in the account’s billing account history.

To ensure that the proper finance charges are applied, the account should be aged before posting finance charges.

Finance charges often serve as good "motivation" in getting a customer to pay their open balance. Finance charges will appear as an due item when you generate a statement for a customer.

Finance charges can very easily be reversed either from all billing accounts or from an individual account in a situation where the customer may remit their total original balance due, but not the finance charge.

Receivables Tab (Finance Charge Setup)

The Receivables Tab of Setup Options allows you to set options in regards to the application of finance charges to customers. Setup options are available by opening the Main Menu, selecting Setup in the left column and then selecting the General button at the top of the right column.

Field	Description
Minimum Days	Minimum number of days that must pass after the items' transaction date (invoice or adjustment date) before the item is eligible to receive a finance charge.
Interval (days)	Number of days that must pass before a new finance charge can be applied to an item.
Day of Month	Default day of the month on which you want to apply finance charges.
Monthly Rate	Total percentage that will be used to calculate finance charges each month. (Annual Interest Rate/12)
Compound Interest?	If checked, additional interest charges will be applied based upon the total of outstanding principal balance plus any accrued finance charges.

To Calculate and Post Finance Charges for All Accounts

1. From the Receivables Manager, right-click and select Post Finance Charges.  The Apply finance charges to all accounts form will open.

2. Click on Prepare to calculate finance charges for accounts that meet the following conditions:

• Account has open items over 30 days (specified in setup),
• Account is not marked No finance charge, and/or
• Account has not had finance charges applied in the current period (normally 30 days, specified in setup).

The system will display all accounts that meet these conditions including the calculated charges.

3. To delete items from the list, move to the items and press Ctrl+Delete or right-click and select Delete.

NOTE:  To clear the list and prepare again, click on Reset.

4. Click Post to post the prepared charges

NOTE: The Review Last button will display the last list of finance charge items. The Reverse button will reverse previously applied finance charges.

To Calculate and Post Finance Charges for a Selected Billing Account

1. Open the billing account history for the selected account. This can be done through the Receivables Manager or by pressing F4 from any other screen where the customer is selected.
2. Double-click the Finance indicator located at the top of the form, or right-click in the grid and select Apply Finance Charge. The Apply finance charges to . . . form will open.
3. Click Prepare to calculate finance charges for the account.
4. Press the Post button to apply the finance charge against the customer's account.

Reversing the Last Posted Finance Charges from All Accounts

After finance charges have been posted, the last finance charges created can be reviewed and reversed. This may be done in a situation where the wrong percentage was applied or perhaps if you forgot to age your accounts before you applied the finance charges.

1. Open the Receivables Manager, right click and choose Post Finance Charges.
2. In the Apply Finance Charge window, click the Review Last button.
   

The list of finance charges last posted will appear in the window.

3. To reverse all of the listed finance charges, click the Reverse button
4. You will be asked to confirm the reversal of all associated accounting information. Click Yes to continue.                                                           
5. Press Enter to confirm the deletion of the finance charges.

Reversing Finance Charges on an Individual Account

If there is a situation where you decide not to hold a customer responsible for paying a finance charge, which has already been applied to their account, you can reverse the finance charge. This will not delete the finance charge, but will rather create an adjustment which will be applied to the finance charge, therefore creating a zero balance due on the charge. The original (but now satisfied) finance charge will remain part of the customer's billing account history.

1. Open the Billing Account History screen for the appropriate billing account.
2. Click on Adjust, located at the bottom of the Billing Account History You can also right-click and select Adjust, or press ALT+2.
3. Click on the Credit finance balance button at the bottom of the window.
4. The Amount field will default to the total finance charges on the account. The Adjust Code will also default to the finance charge code.
5. The Department number will default to 00, the department used to post finance charges.
6. Click Post

Whether the reversed finance charges are equal to a single finance charge item, or are the result of multiple finance charge postings you will need to manually allocate the reversed balance.

Viewing Allocations

Allocations

An allocation is a link to another transaction. This allows you to identify, for example, to what invoice a payment was applied or which open item an adjustment was applied against.  That allocation links the transactions, showing you what was used to pay for what.

Viewing Allocations

Allocations can be viewed for items in the Billing Account History.

1. Select the item for which you want to view the allocations.
2. Double-click on the item or press Enter.

The above example shows allocations to Invoice 100071.  The invoice amount is $2046.60.  A payment of $1923.80 and an adjustment of $122.80 have been applied to the invoice to bring the balance to $0.00.  Since the items are fully allocated, they are no longer considered “open items”.

Items that have no allocation are considered “open items” and will continue to be included on A/R Aging and Open Receivables reports until they have been allocated.

In the following example there is an invoice for $75.80 and a payment for $75.80 that has been allocated.  Notice that the balance column is blank on those transactions.

There are also two adjustments; one for $25.00 and one for negative $25.00.

Those transactions were NOT allocated.  Even though the balance of the account is $0.00, those transactions will continue to be considered “open”.  Notice that both items still have a balance.

If you do not allocate an item when you post it, you can allocate it later.  When you select an item that has no allocation, the allocate option will be enabled.

Removing Allocations

There may be situations where a payment or and adjustment has been allocated to the wrong open item or perhaps the amount was incorrectly entered and the entry must be reversed and reentered. In both cases the existing allocation must be removed. In order to reverse a receivable transaction such as a payment or adjustment it cannot be currently allocated to any item.

1. Right-click on the item that contains the allocation you wish to remove.
2. Right-click on the allocation and select Delete selected allocation.

The item will be returned to the billing account as an open item.  At this point it can be reallocated, or the item can be reversed if you choose.

Looking for a more interactive course on Accounts Receivable? Check out our Learning Management System (LMS)! Our courses are available to all Successware users. If you don't have a sign-in for our LMS, contact us at [e-mail] for a free account.

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