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Generating Receivable Delinquency Fees

Generating Receivable Delinquency Fees

Concept

As part of your collection process, you can generate and approve delinquency fees. These fees are finance charges that you can assess on past-due open invoices or invoices that have been paid late. You create delinquency fees to encourage customers to pay their overdue invoices.

 

You create delinquency fee records by running the Generate Delinquency Fees version of the Credit Analysis Refresh program (R03B525). This version has processing options set for generating delinquency fees. The system creates preliminary fee records on overdue invoices according to the instructions set up in the policy that is assigned to the customer. You can run this version in proof or final mode.

 

When you generate delinquency fees, the system:

• Compares the invoice due date with the effective date of the policy to determine which policy instruction to use when retrieving the rate for calculating the late fee. If the invoice is paid, the system uses the G/L date on the receipt to calculate the number of days paid late: Days Paid Late = The difference between the receipt G/L date and the age as of date

• Uses aging begin days and aging end days in the policy to determine the number of days past the invoice due date (plus grace days, if applicable) to start generating the fee, and the rate and flat fee to use for fee calculations. If the invoice is unpaid when subsequent fees are generated, the system uses the last fee date (LFCJ) from the invoice record, in conjunction with the aging begin days, to determine the start date for generating the fee. The system does not use grace days for subsequent fees.

• Uses the policy to determine whether to calculate the fee on open amounts, paid late amounts, or fees previously generated, such as a compound fee.

• Uses the policy to determine whether to calculate the fee based on the annual percentage rate, a flat amount, or both.

• Prorates fees that were calculated using the annual percentage rate by day using the following formula: ((annual percentage rate/YYY) x .01) x invoice amount x number of days late, where YYY = 365 days (or number of days in a year)

• Generates one fee per customer and currency for all eligible invoices.

• Prints the A/R Delinquency Fee Journal.

 

If you run this program in proof mode, the system produces a Finance Charge Journal that details the invoices selected for a fee and the amount of the fee that will be generated when the program is run in final mode.

 

When you run the program in final mode, the system:

• Creates a delinquency fee document (document type RF) in the Customer Ledger table (F03B11) for the total amount of all fees generated for all eligible invoices for the customer.

• Creates a record in the A/R Fee Journal History table (F03B22) and the A/R Fee Journal History Detail table (F03B23).

• Updates the Last Fee Date (LFCJ) field in the Customer Ledger table (F03B11) and the Receipts Detail table (F03B14).

 

After you generate fee invoice records, you must post them. When you post fees, the system generates an Account Ledger record (F0911) using the AAI items RFC and RFD to determine the revenue account and receivables trade account to use.

 

Prerequisites

 

Before you complete this task, you must:

• Set up AAIs RFC and RFD for delinquency fee processing.

• Verify that you have selected the Delinquency Fees option on the Collection tab of the Customer Master Revision form.

Procedure

In this task, you will use the Generate Delinquency Fees report to create receivable delinquency fees.

Step Action
Navigate to the Generate Delinquency Fees program (R03B525) on the Statement Reminder Processing menu (G03B22).

Click the Statement Reminder Processing menu.

Click the Generate Delinquency Fees menu.

Use the Available Versions form to select a version of the batch program. In your work environment, the system might display additional versions.

Step Action
Click the XJDE0003 option.

Click the Select button.

Use the Version Prompting form to access data selection and data sequencing for the batch program.

If the Data Selection or Data Sequencing options are disabled, you cannot review or change the data selection or sequencing for the version.

Step Action
Click the Data Selection option.
Click the Submit link.

Use the Data Selection form to specify which records the system should retrieve from the database and include in the report.

Step Action
Click the OK button.

Use the Processing Options form to set parameters for how a batch program processes data. Processing options are unique to a version. You should review processing options to ensure that the settings are correct.
Use the Aging processing options to specify how the Accounts Receivable system ages your customer’s invoice information. For example, you define the following information that the system uses to determine whether an account is delinquent, and if it is, the number of days it is delinquent:

• The aging method

• The date that the aging is based on

• The beginning and ending aging categories

Depending on the “as of” date, date type, and aging method that you specify in the processing options, the system determines which aging category to assign each open invoice. If the invoice is assigned to an aging category for which a delinquency policy has been established, the system generates a notice if that processing option is activated.

Use the A/R Company Constants processing option to specify whether the system retrieves aging specifications from the Accounts Receivable constants or from the Aging processing options. Values are:

• Blank: Use the values specified in the Aging processing options.

• 1: Use the values specified in the Accounts Receivable constants. If the Age as of Date field in the A/R constants is blank, the system uses the value in the Date: Age As Of processing option. If the value in the Date: Age As Of processing option is also blank, the system uses the current date. The system ignores processing options 3 through 12 when you choose this option.

Use the Aging Date processing option to specify the date that you want the system to use to determine the aging category to which to assign open invoices. The system compares the date that you enter to the date on the invoice, as specified by the Date Type processing option, to determine the number of days the invoice is past due.

If you leave this processing option blank, the system uses today’s date to age open invoices.

Use the Date Type processing option to specify the date on the invoice that you want the system to use to determine the aging category. The system compares the date that you specify to the value in the Date: Age As Of processing option to determine the number of days the invoice is past due.
Use the Aging Method processing option to specify which aging categories the system uses to assign invoices. The system uses the date specified in the Date: Age As Of processing option and the value specified in the Date Type processing option to calculate the aging for each invoice, and then assigns them to the aging category specified by this code. Values are:

• 1: Aging days. The system assigns invoices to the aging categories specified in the Aging Category 1 through Aging Category 8 processing options. The aging categories are user-defined.

• 2: Fiscal periods. The system uses the fiscal periods defined by the date pattern assigned to the company record as the aging categories.

 3: Calendar. The system uses each calendar month as an aging category.

Use the Aging Category 1 processing option in conjunction with the Aging Category 2 processing option to specify the interval that the system uses for the future and current aging categories.

Note that the system does not print the future aging category on delinquency notices.

Use the Aging Category 2 processing option in conjunction with the Aging Category 1 and Aging Category 3 processing options to determine the interval that the system uses for the current and first aging categories.
Use the Aging Category 3 processing option in conjunction with the Aging Category 2 and Aging Category 4 processing options to determine the interval that the system uses for the first and second aging categories.
Use the Aging Category 4 processing option in conjunction with the Aging Category 3 and Aging Category 5 processing options to determine the interval that the system uses for the second and third aging categories.
Use the Aging Category 5 processing option in conjunction with the Aging Category 4 and Aging Category 6 processing options to determine the interval that the system uses for the third and fourth aging categories.
Use the Aging Category 6 processing option in conjunction with the Aging Category 5 and Aging Category 7 processing options to determine the interval that the system uses for the fourth and fifth aging categories.
Use the Aging Category 7 processing option in conjunction with the Aging Category 6 and Aging Category 8 processing options to determine the interval that the system uses for the fifth and sixth aging categories.
Use the Aging Category 8 processing option in conjunction with the Aging Category 7 processing option to determine the interval that the system uses for the sixth aging category.

Step Action
Click the vertical scrollbar.
Use the Unapplied Receipts Aging processing option to specify the aging method to unapplied receipts. Values are:

• Blank: The system does not age unapplied receipts. The system does not include the unapplied receipt amount in any aging category, including Current.

• 1: Use the aging method that you specify in the Date Type processing option on the Aging tab.

• 2: Use the Current aging column for all unapplied receipts.

• 3: Use the unapplied receipt to the oldest open invoice or group of invoices in a customer’s account. For example, if you have invoices in aging categories 1 – 30, 60 – 90, and 150 – 180, the system applies the receipt to the 150 – 180 aging category until all invoices are paid, and then applies unapplied receipts to the 60 – 90 aging category until all invoices are paid, and so on.

Use the Credit Amount Aging processing option to specify the aging method for credit invoices. Values are:

• Blank: Does not age credit invoices.

• 1: Use the aging method you specify in the Date Type processing option (Aging tab).

• 2: Use the Current aging column for all credit invoices.

• 3: Apply the credit invoice to the oldest open invoice or group of invoices in a customer’s account. For example, if you have invoices in aging categories 1 – 30, 60 – 90, and 150 – 180, the system applies the credit invoice to the 150 – 180 aging category until all invoices are paid, and then applies credit invoices to the 60 – 90 aging category until all invoices are paid, and so on.

Click the vertical scrollbar.
Click the Update tab.

Use the Update Credit and Cash Management Table (F03B15) processing option to update the Credit and Cash Management table (F03B15) with open invoice and aging amounts.
Click the Fees tab.

Use the Fees processing options to specify how the system generates delinquency fees. You can specify options such as generation mode (proof or final), version, the payment terms to assign to the fee record and its currency.
Use the Print Fee Report processing option to specify how the system generates delinquency fees. Values are:

• Blank: The system does not generate delinquency fees.

• 0: The system generates an A/R Delinquency Fee Journal, which is a listing of the fees that the system will generate when you run the program in Final Mode. The system does not update any tables.

• 1: The system generates an RF invoice document in the amount of the fee in the Customer Ledger (F03B11) table. The system also generates records in the A/R Fee Journal History (F03B22) and A/R Fee Journal History Detail (F03B23) tables and prints an A/R Delinquency Fee Journal. The system updates the Last Fee Date in the Customer Ledger (F03B11) and A/R Check Detail (F03B14) tables with the date that fees were generated. Subsequent fees for the same invoice will not be generated until the number of days between fees has elapsed, as defined in the policy.

Use the Version for Fee Processing processing option to specify the version of the A/R Finance Charge Journal program (R03B22) that the system uses to generate delinquency fees. If you leave this processing option blank, the system uses version ZJDE0001.

Note that the A/R Finance Charge Journal has associated processing options.

Use the G/L Date processing option to specify the G/L date that you want the system to assign to delinquency fee (RF) invoice records. The system generates these invoices when you process delinquency fees in Final Mode. If you leave this processing option blank, the system uses today’s date.
Use the Late Payment Delinquency Fees processing option to run the Late Payment Delinquency Fees program (R03B221), which generates a delinquency fee on invoices that were paid after the due date.

Note: You must select the Calculate On Paid Late Amounts option in the policy in addition to setting this processing option.

Use the Version for Late Payment processing option to specify the version of the Late Payment Delinquency Fees program (R03B221) that you want the system to use to generate fees on invoices that were paid after the due. If you leave this processing option blank, the system uses version ZJDE0001.

Note: The R03B221 program has associated processing options.

Use the Payment Terms Code processing option to specify the payment terms code that you want the system to assign to the delinquency fee (RF) invoice record.
Use the Currency of Fees processing option to specify the currency that the system uses to generate delinquency fee invoice records (document type RF). The system uses the most recent exchange rate from the Currency Exchange Rates table (F0015) to calculate the currency fee amount. Valid values are:

• 1: Company. Generate the fee in the currency that is assigned to the company record that appears on the invoice.

• 2: Customer. Generate the fee in the currency that is assigned to the A/B Amount Codes field (CRCA) of the customer record in the Customer Master by Line of Business table (F03012).

• 3: Invoice. Generate the fee in the currency that is assigned to the invoice at the time that the invoice was entered.

Note that regardless of the option that you choose, the system generates one fee invoice record per currency code for each company. For example, if companies 00001 and 00003 are assigned a currency code for Canadian dollars (CAD), the system generates two fee invoices–one for company 00001 for CAD and one for company 00003 for CAD.

Click the OK button.

Use the Printer Selection form to identify printer information for the report. In your work environment, the printer settings will be different.

Step Action
Click the OK button.

Step Action
The report has been submitted. The system does not produce a PDF for this report.

Click the Close button.

You have successfully used the Generate Delinquency Fees report to create receivable delinquency fees.

End of Procedure.

Ayman Refat
Over 20 years of experience in IT area, working as Oracle JD Edwards Developer with expertise in Windows Server, SQL Server and Microsoft Exchange Server, experience in Linux operating systems (Debian and Redhat), VMWare ESX / ESXi, Novell Netware, relational databases like Oracle 10/11g and backup solutions from Computer Associates. Large experience in high-end servers from Dell and HP, having the following certifications: Microsoft: MCP, MCSE, MCDBA, MCSA and MCT (2008 ~ 2013), Computer Associates: Technical Specialist – Storage and Backup Solutions,
http://www.AymanRefat.com

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