ANSWER ID:9101

If your Receivables Reconciliation report shows an out of balance amount but you are unable to locate the transaction that is causing this, you may have recorded a finance charge transaction. This support note explains how to rectify this situation. This information equally applies to Purchases or Trade Creditors.

When a finance charge is charged to a customer, AccountRight records two transactions:

  • a Receive Payments receipt, and
  • a corresponding Sales Invoice (the finance charge).

Therefore, to delete a finance charge you must delete both of these transactions.

  • Depending on your system preferences, you may be able to delete or reverse these transactions. To check your preferences, go to the Setup menu and choose Preferences, then click the Security tab. The option Transactions CAN'T be Changed... determines this.
  • Take a backup of your company file prior to performing the steps below (File > Back Up). For detailed instructions, see the AccountRight help (Australia | New Zealand).

Identify your linked accounts for tracking receivables and tracking late charges. Identifying these accounts will allow you to locate the transactions to be deleted.

  1. Go to the Setup menu and choose Linked Accounts then choose Sales Accounts.
  2. Take note of the account numbers for Asset Account for Tracking Receivables and Income Account for Late Charges as highlighted in the image below.
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  3. Click OK to close the Sales Linked Accounts window. 

Using the Asset Account for Tracking Receivables account number as identified above, you will be able to locate and delete the Receive Payment transaction.

  1. Click Find Transactions (along the bottom of your command centre). The Find Transactions window will be displayed.
  2. Click the Account tab.
  3. Enter the account number for your Asset Account for Tracking Receivables into the Account field.
  4. Enter an appropriate date range in the Dated From and To fields.
  5. Click Advanced. The Advanced Filters window will be displayed.
  6. Type 'Finance Charge' in to the Memo/Payee field, then click OK.
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    The result set will be displayed
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  7. Once you have located the transaction, note its date and then click the zoom arrow to display the transaction.
  8. Go to the Edit menu and choose Delete. On doing so, you will receive a reminder to delete the associated payment.
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  9. Click OK

Using the Income Account for Late Charges account number as identified above, you will be able to locate and delete the finance charge (sales invoice) transaction.

  1. Click Find Transactions (along the bottom of your command centre). The Find Transactions window will be displayed.
  2. Click the Account tab.
  3. Enter the account number for your Income Account for Late Charges into the Account field.
  4. Click Advanced. The Advanced Filters window will be displayed.
  5. Clear the Memo/Payee field.
  6. Set both the Dated From and To fields to the date of the payment receipt deleted in the previous task.
  7. Click OK. The Find Transactions window will now display the Finance Charge (sales invoice) transaction for you to delete.
  8. Click the zoom arrow to display the transaction.
  9. Go to the Edit menu and choose Delete.
  10. Ignore the reminder to delete the Finance Charge and click OK to close the message.

What if I have previously deleted only one of these transactions?

If only one of these transactions is deleted, your receivables account will be out of balance. Rectifying this situation is a matter of locating and deleting the remaining transaction.

To do this, follow the instructions above for locating and deleting these transactions. Once you have done this, if you display your Receivables Reconciliation report it should now show that the account is in balance. 

What if I have not found any such transactions?

You may need to use a wider date range as the transaction may have been dated outside of the range you entered in Locate and delete the Receive Payments receipt transaction above.

Another possibility is that the linked accounts for Asset Account for Tracking Receivables and Income Account for Late Charges may have been changed since the transaction was recorded. In that case perform the search again but this time choose the Search by All Accounts option as shown below.
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If you still can't find the transaction, it is likely that the transaction took place in a previous financial year and has subsequently been purged from your company file.

To check the current financial year of your company file, go to the Setup menu and choose Company Information.

You may record a manual adjustment to correct the customer's Card Balance by following the following tasks:

 

  1. Go to the Sales command centre and click Receive Payments.
  2. Select the Deposit to Account option and select your general cheque account in the adjacent account field.
  3. Select the applicable customer's card.
  4. In the Amount Received field enter the amount which is equal to the finance charge.
  5. Enter the Date and other transaction details. The transaction needs to be dated in the current financial year.
  6. In the Finance Charge field, enter the same amount that was entered in the Amount Received field.
  7. Click Record. The window below shows a Finance Charge only transaction.
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$40.00 is entered in both the Amount Received and Finance Charge fields. The above transaction will record a deposit to the cheque account and a sale for the Finance Charge.
  1. Go to the Setup menu, choose Preferences and click the Security tab.
  2. Select the option Transactions CAN'T be Changed; They Must be Reversed [system-wide].
  3. Click OK.
  4. Go to the Sales command centre and click Transactions Journal.
  5. Set the Date range to capture the Finance Charge. The Window below shows the finance charge sale.
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  6. Click the zoom arrow next to the Finance Charge transaction.
  7. Go to the Edit menu and choose Reverse Payment.
  8. Set the date of the reversal then click Record.
  9. Click OK to the reminder alert.
  1. Go to the Setup menu, choose Preferences and click the Security tab.
  2. Deselect the option Transactions CAN'T be Changed; They Must be Reversed [system-wide].
  3. Click OK.
  4. Go to the Sales command centre and click Transactions Journal.
  5. Set the Date range to capture the original finance charge.
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  6. Click the zoom arrow next to the original Finance Charge transaction.
  7. Go to the Edit menu and choose Delete Payment.
  8. Click OK to the reminder alert.
  1. With the Transaction Journal window open, click the Receipts tab.
  2. Click the zoom arrow next to the Finance Charge Receive Payments transaction.
  3. Go to the Edit menu and choose Delete Payment.
  4. Click OK to the reminder alert. The only transaction left should be the reversal under the Sales tab in the Transaction Journal.

Go to the Card File command centre, click Cards List and check the Card's balance.

The window below shows that the customer now has a zero balance.

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What if the finance charge is from a previous financial year?

Scenario: A finance charge was entered through Receive Payments in a previous financial year. The receipt journal of the finance charge only was also deleted in the previous year.

The above scenario results in a balance showing on the customer card that includes the finance charge, but in Receive Payments the card balance does not include the finance charge, hence there is nothing to receive payments against.

 

  1. Enter a finance charge only Receive Payment (dated in the current financial year) for the amount of the finance charge from the previous year. This will create a sales journal and a receipts journal.
  2. Delete the sales journal just created. This will leave the receipts journal to match up with sales journal created last year.

Example

The finance charge entered the previous year was $10. The following images show how to enter the finance charge only Receive Payment in the current year and the journals this creates.

 

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Why did this happen and how do I prevent it happening again? 

If the finance charge transaction was not intentional, it would have been recorded as a result of an incorrect Received Payment entry.

For example, a customer owes $240.00 but inadvertently you have recorded a payment of $340.00. If you tab through the various fields of the Receive Payments window, the software will automatically allocate the extra $100.00 to the Finance Charge field so that the transaction balances as shown below.

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Unless the finance charge is intended, it's a good idea to always check that both the Finance Charge and Out of Balance fields show $0.00.

If the Finance Charge is entered accidently against an order and the order is then recorded as an invoice, see Customer deposits for more details.

 

Customer deposits

Handling overpayments