Paying Suppliers & Collecting Debts
The following processes and windows are found in the Open Items sub-menu unless otherwise specified.
Receiving Payments from Customers
The POS order type automatically handles the creation of a payment record and allocation to the invoice. For other customer order types, the payment must be manually created and allocated.
If a cash payment is received it must be entered through the Cash Journal window. This can be reconciled with the till or cash tin by creating a new record and entering the Beginning Balance. As lines are entered the statement difference and ending balance is automatically calculated. To create a payment for an invoice, go to the Cash Line tab and create a new record. Select the Cash Type of Invoice and in the Invoice field select the relevant document. The amount field will automatically be updated with the (converted) open invoice amount. You may optionally edit the amount paid, apply a discount, or write-off amount.
Upon completion of this Cash Journal the payment amount will be allocated to the invoice and, if applicable, the invoice will be marked as paid.
Other cash receipts and disbursements can similarly be entered using the Cash Types of Charge, General Expense, or General Receipts. When money is taken to the bank, an entry should be created with a type of Bank Account Transfer (with a negative amount to reflect the reduction of cash in the till). This will then be available for reconciliation with the bank statement.
Other payment types are processed using the Payment window.
In India while paying for certain type of service transactions (like contractors), the paying organization has to deduct tax at source from the payment and pay to the government and a certificate to this effect needs to be issued to the payee. This is called TDS.
A typical transaction would be like this;
Payment due to Vendor INR 10000
Dr. A/c payable (and vendor) 10000
Cr. bank 9000 (Check issued to vendor 10000-(TDS say 1000)=9000)
Cr. TDS 1000
When paid to government;
Dr. TDS 1000
Cr. bank 1000
- Monthly Supplier Pay Runs (cheques and electronic payments) - Weekly Supplier Runs - Prompt Payments (when you really need to pay someone right now)
Reconciling the Bank Statement
- Payment Processor
In Adempiere the process for generating summaries of outstanding amounts to be used in statements or debt collection letters is referred to by the American term 'Dunning'.
To create dunning letters go to the Dunning Run window and create a new record. The Dunning Date field is used to specify a date for calculating the age (number of days overdue) of each outstanding invoice. It is important to note that this does not create a summary as at the date specified, but uses the open invoice and payment amounts as of the time the dunning run is created but with the days due calculated against the specified date.
The Dunning Level field enables you to choose a level of dunning defined in the Dunning window:
- Partner Relations
- Business Partner Rules
This window is to determine what amounts are included in the summaries. This enables you to create differing levels of severity in your debt collection, for example, you might create a level corresponding to monthly statements sent to all customers, and another that sends threats of legal intervention letters for any amounts outstanding over 90 days.
- Clicking on the Create Dunning Run button will then generate the required summaries.
- The process accepts a few parameters, including the option to restrict the run to a selected business partner or business partner group.
- After the process has run (which may take a few minutes) the Dunning Run Entry tab will be populated with entries for each business partner with outstanding invoices that fit the selected level's criteria.
Individual statements and dunning letters can be printed from here. Each entry is accompanied by lines showing the individual invoices and payments as they will appear on the letter.
All the dunning letters can be printed or emailed as a batch using the Print Dunning Letters process. Letters will only be emailed if the business partner has a verified email address and a mail template is selected. The Only If BP has Balance parameter restricts the print batch to those partners with outstanding invoices, otherwise credit balances will also be printed.