You use this program to calculate a monthly finance charge on each outstanding invoice within the customer details file and update the relevant customer to reflect the charge levied.
Finance charge invoices can also be entered using the AR Initial Invoice Capture program at the time of initially capturing customer invoices during a take-on. These invoices (prefixed by the characters FC) are treated as normal finance charge invoices by the system.
- Toolbar and menu
- AR Finance Charge Options
- AR Finance Charge Report
- Rerunning the Finance Charge Calculation
- Notes and warnings
| Field | Description |
|---|---|
| Start Processing |
Select this to calculate finance charges according to your selections. The AR Finance Charge Calculation program checks whether the calculation has already been run for a specific month and year combination and not for a specific period. A warning is therefore only displayed if the calculation has already been run for the same month and year. Refer to Rerunning the Finance Charge Calculation for additional information on re-running the calculation. For Sales Analysis purposes, finance charges are automatically processed to the finance charge product class (_FIN) in the branch defined against the customer (Customers). The calculation creates Invoice entries with an invoice number of FCYYMM (where FC indicates a finance charge and YYMM is the year and month of the report date entered), and a product class of _FIN (indicating it is a finance charge posting). This means that all customers are allocated the same invoice number for the finance charge. The terms defined against the Finance charge terms option (Accounts Receivable Setup) are applied to the finance charge invoice. Although finance charges are allocated an invoice number, effectively they are treated as non taxable debit journal entries that are posted in batch mode to customer accounts. The value of the finances charges is posted to the Adjustments field on the A/R Customer Control record. Credit balance invoices and credit notes (regardless of age), are deducted from the total current value of the outstanding invoices, and the finance charges are calculated on the result. On completion of the calculation, a Finance Charge Report is generated. Details of all the calculated charges are recorded in the relevant customer, invoice and sales transaction files. Details are also printed on AR Invoice Register. |
| Select this to print the information currently displayed in the Report pane. | |
| Save Form Values | This option is only enabled in Design mode (Automation Design). Your selections are saved and applied when the
program is run in automated mode. Form values and defaults are applied at operator level. They are not saved at role or group level. |
| Change Period | Select this to use the Change Posting Period program to change the
period to which the finance charges must be posted. To use the
Change Period function Accounts
Receivable must be linked to General Ledger in
Detail or Summary
(General Ledger Integration). See Password considerations in Notes and warnings. |
| Field | Description | ||||||
|---|---|---|---|---|---|---|---|
| Finance charge information | |||||||
| Annual percent |
This indicates the Annual percent for calculating the finance charge. This cannot exceed 999.99. This value is divided by 12 to produce the Monthly rate that is applied to overdue invoices. For example, if you enter a value of 15 in this field, then finance charges are levied at 1.25% per month (i.e. 15 divided by 12). |
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| Minimum amount |
Enter the minimum finance charge amount that must be levied on overdue accounts. The entered amount is only used as the finance charge if it is greater than the calculated finance charge. For example, if you enter 200 in this field and the calculated finance charges amount to 125, then the customer's account is debited with 200, not 125. |
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| Reporting date |
The date you enter here defaults is used for the ageing of invoices. This field defaults to the current system date but can be changed. This option only applies if your Invoice ageing method is set to: By invoice date or By invoice due date (Accounts Receivable Setup). The Age of the Invoice is calculated as the number of days between the Invoice Date and the Reporting Date. For example, if the invoice date is 5 March 2006 and your reporting date is 30 April 2006, then the invoice is calculated as being 56 days old (i.e. number of days in March excluding 5 March + number of days in April including 30 April = 26 + 30 = 56 days). The period and year in the reporting date also forms part of the finance charge invoice number that is created. The calculation creates an invoice number of FCYYMM where:-
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| Overdue period (in days) |
You use this field to enter the number of days by which the invoice terms can be exceeded without attracting finance charges. Finance charges are raised on invoices equal to (or older than) the overdue period. The calculation used to age the invoices is: Invoice Due Days + Overdue Period in Days = Net Due Days. (The calculation for Invoice Due Days depends on the Invoice ageing method you selected - see Accounts Receivable Setup). For example: If the terms code indicates invoice due days of 30, and the Overdue period is 5, then the invoice must be at least 35 days old in order to attract finance charges. If you enter a zero in this field, then invoices due for payment on or before the date you entered in the Reporting date field are included in the calculation. |
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| Currency |
You use this field to enter the currency of customers for whom you want to calculate finance charges. Finance charges are calculated only for customers with a currency code matching the entered currency. |
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| Compound finance charges |
Select this if you want finance charges to be applied to existing unpaid finance charges. If you select this option, then any finance charge invoices that are overdue for payment are included in the finance charge calculation. This results in finance charges being levied on earlier finance charges not yet paid. |
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| Branch selection | |||||||
| Selection | This enables you to indicate the Accounts Receivable branch for which you want to apply finance charges. Customers attached to the selected branch(es) and who are not exempt from finance charges are included in the finance charge calculation. | ||||||
| Processing options | |||||||
| Function |
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| Posting information | These details are displayed for information purposes. | ||||||
| Current month | This indicates the financial period into which the finance charges will be posted. | ||||||
| Current year | This indicates the financial year into which the finance charges will be posted. | ||||||
| After processing completed |
These options are displayed within programs that can be automated. They enable you to indicate the action you want to perform once processing is complete (see Automation Design). |
The information in this pane is displayed once processing is complete, providing you did not select the option: After processing completed > Close this application.
The results of processing the function you selected are displayed.
The Grand totals line displays the invoice total as well as the total finance charges for the invoices listed.
You use the After processing completed options to print or email this information.
You might need to re-run the Finance Charge Calculation more than once in the same month and year for the following reasons:
- You want to levy finance charges on your local and foreign customers. In this case, you would need to select the currency each time you select to re-run the program.
- You entered the incorrect details in the Finance charge information section and need to correct this.
- The previous run excluded some customers, and as a result, you need to re-run the finance charge calculation for the current month.
Whenever you run the AR Finance Charge Calculation program, the calendar year and month from the reporting date are stored on the A/R Customer Control record. A warning message is displayed if you have already run the AR Finance Charge Calculation program for the same year and month.
When you re-run the AR Finance Charge Calculation program to levy finance charges on customers excluded from the previous run (because their currency was different or they belonged to a different branch) the program behaves as it would when the calculation is run for the first time.
However, there are a few differences in the way the program behaves if you re-run the AR Finance Charge Calculation program for the same selection of customers because you entered the incorrect details in the Finance charge information section for any of the following fields:
- Annual percent
- Reporting date
- Overdue period (in days)
As each customer is processed, the AR Finance Charge Calculation program checks whether a charge has already been levied for the current month and year. If it has, then one of the following actions is taken by the AR Finance Charge Calculation program:
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If the invoice exists and the current calculation options mean that a lesser or higher charge should be levied, then the entry is adjusted on the customer account.
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If the customer did not previously have a charge levied, and the current calculation options mean that a charge should be levied, then an entry is added to the customer account.
![[Note]](images/note.png)
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The AR Finance Charge Calculation program performs the appropriate adjustments to the customers' accounts and it is therefore not necessary for you to process credit or debit notes to adjust the previously incorrect calculation amounts. |
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When compared to the initial Finance Charge Report, depending on the options selected, the report produced at the end of the re-run may possibly contain different customers, invoices, totals and therefore different finance charges. The differences between the original and the re-run details are not highlighted on the Finance Charge Report, nor is there any indication in the heading that it is a re-run. However, the Report Totals page of the Finance Charge Report indicates whether the report was a re-run and whether charges were increased or not.
The result of re-running the calculation on the same customers could result in a greater or lesser amount being debited to customer accounts, and this is shown on the total page of the Finance Charge Report and the Finance Charge Invoice Registers.
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Finance charges can only be applied to customers who are not exempt from these charges.
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This program must be run before customer statements are produced if you intend charging finances charges to customers whose accounts are overdue and you want these charges to appear on the customers' statements.
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Record locks on the customer and invoices are applied during the run of this program, irrespective of whether the Generate only or Generate & update function is run.
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The register numbers assigned during posting are recorded in the ArRegisterRef table (or the SOURCE\CPB\ARSRRF.MAX file in C-ISAM).
When the register number is allocated, a new entry is added to this table with a Status of 0 - Open.
Once all transactions are posted a second transaction is committed, the register entry is updated with the closed date and time, and the Status is changed to C-Closed.
If a problem occurs during the second transaction (for example a power failure) then the audit record remains as 0.
Password access to the following functions in this program may be defined in the Password Definition program. When defined, the password must be entered before you can access the function.
| Field | Description |
|---|---|
| AR Posting to a previous month | This password restricts access to posting Accounts Receivable transactions to a previous period (see Multi-period accounting). |
Inserting Application Help
You would typically follow this procedure to display help for the current program in a customized pane that can be pinned to the program window.
Information includes step-by-step instructions for the various functions available within the program, including a brief overview of what the program does, what setup options are required and how to personalize the program.
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Open the program for which you want to insert application help into a customized pane.
This functionality is only available for a program that has panes.
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Right-click any form field.
You can also click the triangle menu icon that appears in the title area of a pane.
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Select Insert Application Help from the context-sensitive menu.
The application help appears in a pane within your program. You can reposition the pane using the docking stickers or pin it to the program window.
Removing the Application Help pane
If you no longer want to display application help in a pane for your current program, you can simply remove it.
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Select the Close icon in the right-hand corner of the application help pane.
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Confirm that you want to delete the pane.