Accounts Receivable Payment Data Entry Business Rules

Overview

In addition to the security setup in OFD, different business rules apply when a payment is entered in Govern and the behavior of the form may vary.
The following rules apply whether the payment is entered from the A/R Inquiry Payment or from the Cash Collection form unless identified as such.
Furthermore, other Cash Collection business rules and validation can apply.

Parameters

The following parameters impact payment data entry.

Accounts Receivable General Parameters

Use Proportional Distribution (Deprecated in 6.0)

• Select this option to enable Proportional Distribution for cash collection. With Proportional Distribution, payments are distributed according to the amount owed on each account.
• For example, if the client pays $100.00 but owes $150.00 for electricity and $50.00 for water, $75.00 is paid towards the electric bill and the remaining $25.00 towards the water bill.

Minimum Percent or Amount to Collect

The user cannot enter less than the calculated amount on the Payment Data Entry forms in Govern, unless:

• The Allow Payments < Late Charges Due option is selected
• The User has the Security access to the Payment Amount define in OpenForms Designer (OFD) – to be validated in cc
  • For example: If you enter 50%, the minimum payment amount is 50% of the installment due. The user cannot enter less than the calculated amount in the Payment Amount
• If the previous installment is not completely paid, the remaining amount is added to the current installment. This amount needs to be paid before the minimum amount on the current installment can be collected.
  • For example, a $3,000. Tax bill is divided into three installments of $1,000.
    • The minimum collection amount is 50% ($500. in this example).
    • The client pays $800.00 on the first installment, leaving $200.00 remaining.
    • This is added to the second installment.
    • The minimum amount that can be paid on the second installment is $700.
    • $200.00 (unpaid amount from first installment) +500.00 (minimum collection amount for second installment).
• The Minimum Percent or Amount to Collect can be the same for ALL sub-systems (General) or vary by module (Sub-System)

Allow Payments < Late Charges Due

Used with the Minimum to Collect option

Collection Year

For Real Property and …..

• The last year for which you are collecting bills.
  • For example, if you enter 2015, payments cannot be made on bills dated 2014 and before.
• Typically, this option is used by municipalities that transfer bills to the county, or to another level of government, after a set time has passed.

Use Exact Installment

• Select this option to prevent collection of the second installment through the Payment Data Entry form before the first has been collected. Otherwise, if the second installment is collected while the first remains outstanding, the second installment payment is registered as the total payment in the database.

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Accounts Receivable (A/R) Payment Application Priorities Business Rules

Overview

The following explains the payment application and priority business rules.

Parameters

Mainly, the following parameters impact the payment priority order:

A/R Sub-System Priorities
Enter a number in the Priority field next to each subsystem to define the order in which bills are paid.
The higher the number, the higher the priority and the sooner the bill is paid.
Note: If a collection year is entered on the Accounts Receivable General Parameters form, no payments will be made on bills dated prior to this year.

Ignore Year:

Select Ignore Year to use only the subsystem priority when making payments.
Bills from the subsystem with the highest priority are paid first.
Otherwise, if this option is deselected, payments are made on all outstanding bills according to year; i.e., all bills from 2012 are paid before the bills from 2013.

Application Order

Payments application order:

Sub-System

• Payments are made first to the subsystems with the Ignore Year option selected, according to Priority Number. The subsystem with the highest priority number is paid first.
• Payments are then made to subsystems with the Ignore Year option deselected, according to Priority Number. The subsystem with the highest priority number is paid first.
  • Note: If a collection year is entered on the Accounts Receivable General Parameters form, no payments will be made on bills dated prior to this year.
• If two subsystems have the same priority number, payments are made in alphabetical order.

A/R Class Code

Priority can be setup by Class code
Priority (Highest Number = Highest Priority)
The Class Code with the highest number is processed first; i.e., the class code assigned priority number 2 is processed before that with priority number 1.

Apply Before Installment/Apply Before Date
If two class codes have the same priority number, they are processed according to these 2 fields.
The following table defines the four possible combinations that can be set for these options:

History / Inactive Account

(validated if in used for Cash Collection)
An account can be inactivated. This option is set in the Accounts Receivable A/R Inquiry Notes tab.
When turned on, no further Accounts Receivable transactions can be performed on the account.

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