1. Accounts Receivable Implementation Guide
  2. Threshold Percent, Grace Days, and Pay By Days

Threshold Percent, Grace Days, and Pay By Days

In addition to the aging category or severity that is used to locate the policy's notification instructions, the system uses this additional criteria to determine whether to generate a delinquency notice:

  • Threshold Percent

    You use the threshold percent to limit the number of delinquency notices that you generate by amount. The sum of the invoices for the specified aging category (or severity) must be greater than or equal to the threshold percent of all open invoices for the customer.

    For example, if the open balance of the customer is 7500.00 and the threshold percent is 20, the sum of the invoices in the aging category must be at least 1500.00 or the system does not generate a delinquency notice.

  • Grace Days

    The system extends the invoice due date by the number of grace days for the first delinquency notice only. Subsequent delinquency notices do not use the grace days; the system adds the number of days between delinquency notices to the value of the Date of Last Sent Reminder field (RDDJ), and if the invoice is still outstanding as of that date (and meets the other requirements of the policy), the system generates another notice.

  • Pay By Days

    In some countries, it is a legal requirement to provide the customer with a notification payment date (new due date) on the delinquency notice. The customer must remit payment by the notification payment date. To accommodate this request, you use the Pay By Days field (PBDY) in the notification policy, which the system adds to the aging date to determine the Notification Payment Date (DTPB) that prints on the delinquency notice. Unlike grace days, the system uses the pay by days on every delinquency notice that it generates (not just the first).

    You can use both grace days and pay by days. For example, if the due date is June 15, 2008, the aging date is June 30, 2008, and you specify 3 grace days and 5 pay by days, the system extends the due date to June 18, 2008 to determine the aging category (and notification policy), and then updates the notification payment date to July 15, 2008. The system prints the notification payment date on the delinquency notice only when you select the Tiered Delinquency Notice Print program (R03B21).

    Note:

    If one invoice meets the requirements for one of the notification instructions that are set up for the policy, the system generates a delinquency notice that prints all past-due invoices, unless they are less than the minimum amount requirement that is set up for the aging category (severity level). The system does not print any invoice that is less than the minimum amount that is specified in the notification instructions.

    If invoices in more than one aging category or severity level trigger the program to generate a delinquency notice, the system uses the notification instructions from the oldest aging category or greatest severity level. For example, if invoices in aging category 2 and in aging category 4 meet the requirements of the policy, the system uses the notification instructions that are set up for aging category 4 only.