How Late Payment Charges Get Calculated

Late payment charges are system-generated adjustments used to penalize a customer for late (or no) payments. This section describes how to set up the tables that control how and when late payment charges are generated. The following points describe how and when late payment charges are calculated.

• When a bill is completed, the system marks it with the date on which late payment charges will be calculated if the bill is not paid.
  • This date is calculated by adding grace days to the bill's due date. Grace days are defined on the account's Customer Class / Division.
  • This date will be zero if the account's Customer Class / Division indicates the account is not eligible for late payment charge processing.
• The late payment charge background process (referred to by the batch ID of LATEPYMT ) selects all bills on or after their late payment charge date.
  • For each such bill, the system determines if its account satisfies the late payment charge eligibility criteria defined on the account's Customer Class / Division. The eligibility criteria are defined in an algorithm and can therefore be as flexible as required.
  • If an account is eligible for late payment charges, the system checks each of the account's service agreements to determine if it is eligible for late payment charges (as defined on the service agreement's SA Type ).
  • If a service agreement is eligible for late payment charges, the system calls the SA type's late payment charge calculation algorithm. This algorithm should calculate the late payment charge amount, if applicable and return the calculated amount and an appropriate adjustment type to use. If this algorithm returns this information, an adjustment is generated to levy the late payment charge.