Financial Transactions And Aged Debt
The system keeps track of how old a contract's current balance is in order to determine if the customer is in arrears (and therefore credit and collections processing should start).
A financial transaction (FT) impacts the related contract's current and payoff balances the moment it is frozen. However, some types of frozen FTs have no impact on a customer's aged debt until the next bill is completed for the account associated with the contract.
As described in the previous section, a frozen financial transaction (FT) waits in limbo until the customer's next bill is produced. This limbo period could be several weeks if the customer is billed infrequently. When the customer's next bill is completed, all such frozen FT's are linked to the bill. It is important to stress the following in respect of these FT's:
- If the FT decreases the amount of debt, the customer's aged debt is affected immediately regardless of whether the FT appears on a bill.
- If the FT increases the amount of debt, the amount the customer
owes from an aged debt perspective may or may not be affected
by the FT. There is a switch on an FT called New Charge that controls the arrears behavior.
- If this switch is on, the amount of debt will be reflected as a "new charge" when you look at the customer's aged debt. This amount will remain classified as a "new charge" until the FT is swept onto a bill. The moment the FT is swept onto the customer's bill, the debt starts aging. This logic exists because you probably don't want to start aging an FT until the customer has actually seen it.
- If this switch is off, the date on which the FT starts aging must be defined in the Arrears Date field. The Arrears Date is used to compute how many days old the debt is.