Configuring Accounts Receivable Account Types

Account Receivable account types enable you to categorize AR accounts. The account type selected in each AR Account is used for filtering in both the application and also on reports, such as when generating an AR aging report subtotaled by account type. Account types also determine the stationery templates to use when generating statements and reminder letters for each AR account.

To set up account types:

  1. From the Administration menu, select Financial, select Accounts Receivables Management, and then select Account Types.
  2. Click New.
  3. Select or confirm the Property name.
  4. Enter the Account Type code.
  5. Enter a Description of the account type.
  6. Enter a Credit Limit for the account type.
  7. Select a Statement Mode. Statements for all accounts having this account type will be prepared using the statement modes selected from the following options:

    • Balance Forward. A balance as of the MM/DD/YY field on the statement shows the total previous balance for the account. The last statement date and total amount from the last statement will be printed on the statement as the balance forward date and balance forward, respectively, by default unless overridden by a date in the Balance Forward From field.

    • Individual Open Items. All open invoices making up the outstanding balance are listed as individual line items on the statement.

  8. Select the Reminder Cycle mode for sending reminder letters. Options are:

    • End of Month. Reminder letters are generated at the end of each month if the account has an outstanding balance. As an example, this option might be appropriate if you select appropriate if you select the Balance Brought Forward statement mode.

    • Days. Reminder letters are generated based on the number of days the account has had an outstanding balance. Use this option if you want to send a reminder letter for outstanding balances of 30 days, 60 days, 90 days, or so on. This option might be appropriate if you select the Individual Open Items statement mode. Accounts Receivables Reminders and Reminder Cycles

  9. Letter Name – select the reminder letter template you want to generate if you selected End of Month as the Reminder Cycle option.
  10. Statement Name – select the statement template to use for this account type.
    1. Select Print Invoices without details if you do not want to print invoice details on the statement.
    2. Select Print Invoices with details to print invoice details on the statement. Invoice details appear under each invoice number, along with a subtotal per invoice. Invoice details include date, individual charges, and a description.
    3. Select Print Separate Folios to print the statement followed by the separate folios included in the statement. Folios must have a folio number; invoices entered using Toolbox > Utilities > Data Management > AR Enter Old Balances will not have a folio number and will not be printed. When you select this option for the account type, the Print Folios check box is selected by default when selecting Statement Options for the AR Account.

    Finance Charges

    Finance charges can be levied against outstanding AR balances if the AR > AR Finance Charges application function is set to Y. This feature enables OPERA Cloud to calculate and post either a flat amount or percentage charge based on a defined cycle within the month.

    The age of the invoice is determined by the date the invoice is created.

    The End of Day Post AR Finance Charges procedure posts finance charges using the transaction code specified by the AR > Default Finance Charge Transaction Code application setting.

    Each finance charge posted appears on the AR account as a separate invoice. On this invoice, the Supplement text for the finance charge transaction reads: "Finance Charges Posted Automatically."

    Note:

    If the finance charge calculation results in a zero amount or a negative amount, no finance invoice is generated

    1. In the Finance Charges section, enter a Post On Day for the day in the month when the End of Day procedure should run the AR Post Finance Charge procedure. Valid values are 1 to 28.

    2. Enter a Charges (Invoices) Older Than (n) Days after which an outstanding balance triggers finance charges. For example, if invoices older than 30 days incur a finance charge, enter 30 in this field. When the Finance Charges process runs, it will identify open balance invoices older than 30 days.

    3. Select Percent if the finance charge is to be a percentage of the outstanding balance. Enter the percentage in the field.

    4. Select Amount if the finance charge is to be a flat amount regardless of the outstanding balance. Enter the amount in the field.

    5. Select the Include Unallocated Payments check box to include unallocated payments posted to the AR account in the finance charge calculation. When the check box is selected, any unallocated payments are subtracted from the outstanding balance before the finance charge is calculated.

    Example:

    The Post AR Finance Charges process is scheduled to run for the AR account type on the 18th of each month for invoices older than 30 days and apply a 10% fee. Today's business date is June 18: The debtors account shows the following outstanding balances:

    Table 12-1

    Invoice Date

    Age (from Invoice Date

    Invoice Balance Due

    Jan 13

    156 days

    $100

    Feb 12

    123 days

    $200

    Mar 11

    99 days

    $150

    May 10

    39 days

    $100

    May 11

    38 days

    –$100 (unallocated payment)

    May 20

    29 days

    $175

    • If the $100 unallocated payment is not included in the calculation, the total amount outstanding is $550 and the financial charge applied is $55.

    • If the $100 unallocated payment is included in the calculation the amount outstanding is $450 and the finance charge applied is $45.

    The finance charge is posted to the AR account as a new invoice dated June 18th. The outstanding invoice created on May 20th is not included in the calculation because it is less than 30 days old.

    Daily Reminder Cycle Details

    When the Reminder Cycle field is set to Days, the Daily Reminder Cycles configuration lets you determine which reminder letters are generated for AR accounts with an outstanding balance for a given number of days. You can generate a different reminder letter for outstanding balances of 30 days, 60 days, and 90 days. The date when the aging "clock" starts, and thus when the first reminder cycle begins, is set by the AR > Date For Aging application setting.

    Note:

    When the AR > Simple Reminder application parameter is set to Y, the Reminder Details screen sorts reminder letters in the order in which they were set up, starting with the first letter that was configured. This is typically the order in which these letters are generated for reminder letter mailings. There may be more than one letter queued to be generated for the AR account depending on the age of the account balance and which letters have already been generated.

    Note:

    When the AR > Simple Reminder application parameter is set to N, reminder letters are sorted based on the number of days in the reminder cycle, lowest to highest. For this parameter setting, reminder letters are generated depending on the age of the account balance, not on the letters already generated. For example, assuming there are 30-, 60-, and 90-day reminder cycles, if the account balance is 63 days old when letters are generated, the 60 day letter is sent regardless whether the 30 day letter was previously generated.

    1. Click New to add customized Daily Reminder Cycle Details. You can set up multiple reminder cycles by clicking New multiple times.

    2. Enter the number of days between reminders.

    3. Select a letter from configured reminder letter templates.

    To Delete a record:

    1. Select the reminder letter and then select the vertical ellipsis.

    2. Select Delete, confirm your decision, and click Delete.

  11. Click Save.

Editing Account Types

  1. From the Account Types presentation screen, search for account types.

  2. From search results, select an account type and then select the row-level vertical ellipsis.

  3. Select Edit, make changes, and click Save.

Deleting Account Types

  1. From the Account Types presentation screen, search for account types.

  2. From search results, select an account type and then select the row-level vertical ellipsis.

  3. Select Delete, confirm your decision, and click Delete.

Parent topic: About Accounts Receivable Configuration