Understanding Pre-authorized Drafts
Automatic drafts are also called pre-authorized drafts because they do not require customer acceptance for each draft. You and the customer agree in advance that the customer will pay with a draft. You do not print and send a draft to the customer, but instead remit (deposit) the draft to the bank for collection.
You create automatic drafts by running the Pre-Authorized Drafts program (R03B671). You select the invoices to pay with each draft by using data selection. You can run this batch process in either proof or final mode:
Using proof mode, you can select to generate a detail or summary report of transactions:
Detail - lists each invoice to be paid by draft.
Summary - prints a summary of all invoices by customer or payor, due date, and payment instrument to be paid by draft.
Using final mode, you can make the same selections as in proof mode. In final mode, the system:
Creates drafts.
Updates the pay status of drafts to D (draft accepted).
Generates a report.
Whichever mode you select, you can review the information and make necessary changes. You can use either Standard Invoice Entry or Speed Status Change to change the pay status.
The system processes drafts in the same way as receipts except that the system:
Uses batch type DB (draft receipts).
Applies draft receipts to open customer invoices.
Creates an invoice record with a document type of R1 in the F03B11 table for the total draft amount.
Updates the payment status of the draft invoice to D (draft accepted).
After you generate drafts, you must approve and post them to the general ledger to create the appropriate journal entries.
This program updates and creates records in the F03B11, F03B13, and F03B14 tables.