Configuring Write-Off Reversals

About Write-Off Reversals

Write-off reversals enable you to re-allocate payments to accounts and bill units that were written off due to unpaid balances. Unpaid bills and item charges are generally written off as unrecoverable debt, but this feature enables the amount written off to be recovered and allocated to open bills and items of an account.

The following steps occur when a payment is made for a written-off amount. It also describes the steps that occur if the original payment must be reversed and the paid amount must be written off again:

An account or bill unit contains an unpaid balance that was written off as unrecoverable, and a payment is received for the written-off amount.
If the write-off reversal feature is enabled, the write-off on the account or bill unit is reversed.
The written-off balance is transferred back to the account or bill unit.
The payment is applied to the account or bill unit and all paid-off bill items are closed.
Any remaining balance on the account or bill unit (for an underpayment) is written off again.
If the payment fails, a reversal of the payment is submitted.
BRM verifies that the original payment was applied to the written-off account or bill unit.
The second write-off on the account or bill unit is reversed, if one exists (when the write-off reversal payment was an underpayment).
Any bill items closed by the original payment are reopened and the amount is transferred back to the account or bill unit.
The original payment is reversed.
After the payment reversal, if the account or bill unit has a balance due, the amount is written off again to restore the account balance to 0, and the account or bill unit status is reset to write-off.

About Overpayment and Underpayment Allocation to a Written-off Account or Bill

After a payment is posted to a written-off account or bill unit, the handling of the bill or bill items is determined by the amount of the payment: exact payment, overpayment, or underpayment. Exact payments are allocated to the appropriate bill and bill items, which are closed after being paid, and the account's write-off flag is not reset to write-off.

Overpayments and underpayments are allocated according to the rules defined in your business policies:

In general, if the payment amount is more than the amount written off, the paid bills and bill items are closed and the remaining amount is left unallocated in the account. The account or bill unit is left open and the account's write-off flag is not reset to write-off.
If the payment amount is less than the amount written off, the payment is fully allocated, and the open bills and bill items are closed again. The remaining amount is written off and the account's write-off flag is reset to write-off.
If an underpayment fails and you reverse it, both the amount that was written off (due to the underpayment) and the amount that was removed by the payment are returned to the account or bill unit. This restores the account balance to its original state so the entire amount can be written off again. This corresponds to the initial write-off amount for the account or bill unit.

For example, if your company writes off a $50 unpaid balance on an account and 6 months later receives a payment of $45 for that account, the $50 write-off is returned to the account so that the payment can be applied toward the balance. After the payment amount is subtracted, the remaining $5 balance is written off again.

Later, if the $45 payment fails, the following steps occur when you reverse the payment:
1. The $5 write-off amount is returned to the account balance.
2. The $45 balance that was removed by the initial payment is returned to the account balance.
3. The $50 account balance is written off again.
If any open unallocated items are in the account at the time of the reversal, the re–write-off on the account does not occur. You must first allocate and close the open items, or customize the PCM_OP_BILL_POL_REVERSE_PAYMENT policy opcode to allocate and close the open items, before performing the reversal.

Defining Reason Codes for Write-Off Reversals

You define additional reason codes in the reasons.locale file for the write-off reversal event and the re–write-off of an account. You use the Credit Reasons domain (version 8) for write-off reversal reasons, and you should map the reason code to the /event/billing/writeoff G/L ID, as shown in the following sample:

DOMAIN = "Reason Codes-Credit Reasons" ;
STR
     ID = 4 ;
     VERSION = 8 ;
     STRING = "Write-off for Auto-writeoff reversal feature" ;
     EVENT-GLID
       "/event/billing/writeoff"     110;
     EVENT-GLID-END
END

Note:

If you add your own reason codes to the reasons.locale file, you should use IDs above 100,000.

To define reason codes for write-off reversals, you edit the reasons.en_US sample file in the BRM_home/sys/msgs/reasoncodes directory. You then use the load_localized_strings utility (see "load_localized_strings" in BRM Developer's Guide) to load the contents of the file into the /strings objects.

When you run the load_localized_strings utility, use the following command:

load_localized_strings reasons.locale

Note:

If you are loading a localized version of this file, use the correct file extension for your locale.

Mapping G/L IDs to Write-Off Reversal Events

You can track funds you recover from write-off reversals in your general ledger (G/L) system. In addition, you can track the following events that occur if the payment fails and must be reversed:

If the payment was an underpayment, the write-off reversal event that occurred for the second write-off, which was required to write off the unpaid balance on the account.
The reversal of the original payment that failed.
The re–write-off of the debt on the account.

Depending on your G/L configuration, you can create single or separate G/L entries to track the reversed written-off amount and associated tax amount in respective G/L accounts.

You map custom G/L IDs for write-off reversal events by editing and loading the reasons.locale file. This file contains the reason code definition that is assigned to the G/L ID of the /event/billing/writeoff event.

To load a customized reasons.locale file into the BRM database, use the load_localized_strings utility. This utility loads the event-to-G/L ID mapping into a /config/map_glid object in BRM. The G/L ID -to-event mapping is defined in the pin_glid file.

You map custom G/L IDs when you define your reason codes for the write-off reversal event. See "Defining Reason Codes for Write-Off Reversals".

For more information about general ledger data, see "About Collecting General Ledger Data" in BRM Collecting General Ledger Data.

Enabling Automatic Write-Off Reversals during Payment Collection

You can configure BRM to reverse write-offs on accounts and bill units automatically when payments are received for written-off amounts. This enables the payment to be posted to the accounts and bill units and the written-off amount to be recovered immediately during payment processing.

To enable this feature, run the pin_bus_params utility to change the AutoWriteOffReversal business parameter. For information about this utility, see "pin_bus_params" in BRM Developer's Guide.

To enable automatic write-off reversals during payment collection:

Go to BRM_home/sys/data/config.
Create an XML file from the /config/business_params object:
```
pin_bus_params -r BusParamsAR bus_params_AR.xml 
```

In the XML file, change disabled to enabled:

<AutoWriteOffReversal>enabled</AutoWriteOffReversal>

Save the file as bus_params_AR.xml.
Load the XML file into the BRM database:
```
pin_bus_params bus_params_AR.xml 
```
Stop and restart the CM.
(Multischema systems only) Run the pin_multidb script with the -R CONFIG parameter. For more information, see "pin_multidb" in BRM System Administrator's Guide.

For information on how to customize the write-off level to search for and to be available for reversal during payment processing, see "Customizing Write-Off Reversals" in BRM Opcode Guide.

Enabling Write-Off Reversals for Bill Units

By default, BRM is configured to reverse write-offs for accounts when payments are received.

You can configure BRM to reverse write-offs for bill units when payments are received for a written-off bill unit. When you configure BRM to perform write-off reversals for bill units, BRM reverses write-offs for both bill units and accounts.

To enable this feature, run the pin_bus_params utility to change the WriteOffLevel business parameter. For information on this utility, see "pin_bus_params" in BRM Developer's Guide.

To enable write-off reversals for bill units:

Go to BRM_home/sys/data/config.
Create an XML file from the /config/business_params object:
```
pin_bus_params -r BusParamsAR bus_params_AR.xml
```
In the XML file, change account to billinfo:
```
<WriteOffLevel>billinfo</WriteOffLevel>
```
Save the file as bus_params_AR.xml.
Load the XML file into the BRM database:
```
pin_bus_params bus_params_AR.xml
```
Stop and restart the CM.
(Multischema systems only) Run the pin_multidb script with the -R CONFIG parameter. For more information, see "pin_multidb" in BRM System Administrator's Guide.