On-Account Processing

Part or all of a check may be placed on account.  If a check is sent without a remittance advice and time is not available to determine which open items should be paid, the entire check should be placed on account.  If a check is sent as an advanced payment or in payment of a purchase not yet delivered, the check should be placed on account.  If a check overpays one or more open items, the open items should be paid and the remainder of the check placed on account.

Check amounts placed on account are eventually applied from on-account to open items.  Once the open items to be paid are identified or created (in the case of an advanced payment), a from on-account transaction can be performed in Payment Entry and Application.  Only one on-account payment can be selected and applied for each from on-account transaction.  When a payment is selected for a from on-account transaction, the payment's on-account amount is made available for application to open items.  All or part of this amount can be applied to open items.  If all the on-account amount is not used, the remainder can be placed back on account and accessed later.

When all or part of a payment is placed on account, an accounting transaction is generated to an unapplied cash account for the amount of the payment placed on-account.  The unapplied cash account is specified on the Reference File account number assignment record (category 302) for each company/location and A/R code. 

Because category 302 is keyed by company/location and A/R code, you can set-up multiple unapplied cash accounts.  When a payment is selected from on account and applied to an open item, an entry is generated to reduce the unapplied cash account by the amount applied.

Apply an Amount from On-Account

To apply an amount from on account, press F7-Transaction Select, on the Payment Header screen.  The Transaction Selection screen (ARl20S04) is displayed.  Checks and drafts can be selected for a from on-account transaction on the Transaction Selection screen.  Part or all of the check or draft amount can be placed on account to be applied later to new open items.

To select a check or draft to be applied from on account, enter the payment number, customer number, and transaction code for on account on the Transaction Selection screen.  Transaction codes are set up by the user on the Reference File (category 338). When the Enter key is pressed, the Payment Header screen is displayed.

If the payment number is left blank, the Payment List screen (AR120S05) is displayed.   This screen displays all the customer's payments with non-zero on-account balances.  Select a payment from the Payment List screen and press the Enter key.  The Payment Header screen is then displayed. The payments on-account amount from the Payment List screen is displayed  in the amount field on the Payment Header screen.  You can also change the amount field to an amount that exactly clears a specific open item.  Apply the amount from this point using the instructions in  Enter and Apply a Check.

If a payment with a remittance procedure is selected to be applied from on account and the payment has already been accepted and remitted to the bank, the payment amount cannot be changed on the Payment Header screen.  For a draft that has not been remitted, the payment amount can be changed.