Managing doubtful customers

DMF

0816** BANKING DOUBTFUL CUSTOMERS *

081601 BANKING DOUBTFUL CUSTOMERS CHANGE CUSTOMER TO DOUBTFUL

081602 BANKING DOUBTFUL CUSTOMERS CHANGE CUSTOMER TO NON-DOUBTFUL

081603 BANKING DOUBTFUL CUSTOMERS CHANGE CUSTOMER STATUS

081604 BANKING DOUBTFUL CUSTOMERS CHANGE INVOICE TO DOUBTFUL

081605 BANKING DOUBTFUL CUSTOMERS CHANGE INVOICE TO NON-DOUBTFUL

081606 BANKING DOUBTFUL CUSTOMERS CHANGE INVOICE STATUS

081607 BANKING DOUBTFUL CUSTOMERS DOUBTFUL INVOICES

081608 BANKING DOUBTFUL CUSTOMERS DOUBTFUL CREDIT NOTES

081609 BANKING DOUBTFUL CUSTOMERS DOUBTFUL CUSTOMER RECEIPTS

081610 BANKING DOUBTFUL CUSTOMERS CHANGE INVOICE TO IRRECOVERABLE

081611 BANKING DOUBTFUL CUSTOMERS PROVISION MANAGEMENT

081612 BANKING DOUBTFUL CUSTOMERS SETUP

When a company's closing date is approaching, it is recommended to carry out accounting inventory works. One of the tasks to perform consists in assessing the inventory value of items, such as customers receivables resulting from recovery difficulties.

The company can decide to first mark the receivable as doubtful, then issue an accounting provision.

As a reminder, doubtful receivables are established receivables (known to the debtor) that a company has against customers of doubtful solvency or towards conflicting customers.

Doubtful receivables refer to the amount of debts which a company may fail to recover due to customers insolvency or conflicting invoices at the end of an accounting period.

For insolvent customers, the conflicting invoice(s) will no longer be paid; the receivable is therefore considered as irrecoverable.

Note

Before a debt is considered as irrecoverable, the customer must first be marked as doubtful. You cannot directly mark a customer's debt as irrecoverable.

To use this feature, you must first report doubtful customers:

1 To do so, open a Customer record sheet and click on the Finances tab.
2 In the Doubtful status section, enter the following information:
  • Status: indicates the status (cannot be modified)
  • Status date: indicates the date when the customer was changed to "Doubtful" (cannot be modified).
  • Irrecoverable date: indicates the date when the customer was changed to "Irrecoverable" (cannot be modified).

This information will be used when searching for doubtful customers.

In the customers search results, you can do the following actions for multiple customers at once:

  • Change the selected customers to doubtful
  • Change the status
  • Change the selected customers to non-doubtful

From the desired customer record sheet, go to Edit > Accounting view > Doubtful account > Change the customer to doubtful.

A window opens and enables you to enter a new status for the customer as well as the date:

  • Status: the list of status marked as Doubtful.
  • Date: the current date by default (can be modified).
  • Journal: by default, it is the journal specified in the status setup.

Thereafter, all invoices that will be issued on this doubtful customer will direct towards the doubtful control account.

This feature will:

  • Mark the customer as doubtful
  • Mark all unpaid invoices as Doubtful.
  • Generate the accounting entries needed to change the customer's balance to doubtful

From the desired customer record sheet, go to Edit > Accounting view > Doubtful account > Change the customer's status.

A window opens and enables you to enter a new status for the customer as well as the date:

  • Status: the list of status marked as Doubtful.
  • Date: the current date by default (can be modified).
  • Journal: by default, it is the journal specified in the customer record sheet then in the status setup.

Thereafter, all invoices that will be issued on this doubtful customer will direct towards the doubtful control account.

From the desired customer record sheet, go to Edit > Accounting view > Doubtful account > Change the customer to doubtful.

A window opens and enables you to enter a new status for the customer as well as the date:

  • Date: the current date, by default (can be modified).
  • Journal: by default, it is the journal specified in the customer record sheet then in the status setup.

This feature will:

  • Unmark the customer as doubtful
  • Unmark all unpaid invoices as "doubtful"
  • Reverse the accounting entries to change the customer's balance to "non-doubtful".

From the Invoice record sheet > Information tab, specify the fields in the Doubtful status section:

  • Status
  • Status date
  • Provision amount
  • Irrecoverable date
  • Provisioning %
  • Provision date
  • Comment

From the desired invoice record sheet, go to Edit > Doubtful account > Change the invoice to doubtful.

This only applies when the invoice is not completely paid.

This feature will:

  • Mark the invoice as doubtful.
  • Generate the accounting entries needed to change the customer's balance to doubtful

From the desired invoice record sheet, go to Edit > Doubtful account > Change the invoice to not doubtful.

This feature opens a window to enable you to enter the following information:

  • Date: the current date, by default (can be modified).
  • Journal: by default, it is the journal specified in the customer record sheet then in the status setup.

An entry will be generated per non-paid invoice, with a hyperlink to open the entry.

This feature will:

  • Unmark all unpaid invoices as "doubtful"
  • Unmark all unpaid invoices as "doubtful"
  • Reverse the accounting entries to change the customer's balance to "non-doubtful".

From the desired invoice record sheet, go to Edit > Doubtful account > Change the invoice status.

This feature will open a window to enable you enter a new status for the invoice as well as the date:

  • Status: the list of Doubtful statuses.
  • Date: the current date, by default (can be modified).
  • Journal: by default, it is the journal specified in the customer record sheet then in the status setup.

All new invoices that will be issued on this doubtful customer will direct towards the doubtful control account.

When creating invoices on a doubtful account, all the lines in your sales invoice must direct towards the doubtful control account.

All entries will therefore be generated on this doubtful control account.

Invoices will have to be marked as doubtful and the status date will be the invoice date.

To manage provisions (grants and recoveries), go to Accounting > Periodic works > Doubtful debt management.

From the search results screen, you can perform the following actions:

The provisioning percentage can be updated for one or multiple lines at once.

This percentage enables you to set the debt amount to pay in.

The default percentage is 100%.

The search result displays a standard input column for the amount paid in, with the provision amount saved from the last accounting position.

By right-clicking on one or multiple lines, you have access to the Change amount to pay in and Change percentage to pay in features.

The Change amount to pay in feature enables you to enter an amount in euros. Once saved, the value in the Amount to pay in column is automatically updated.

The Change the percentage to pay in feature enables you to enter a percentage. Once saved, Akuiteo calculates the new paid in amount and the Amount to pay in column is automatically updated.

You can enter the amount in euros directly in the table. Once saved, the value in the Amount paid in column is automatically updated.

You can validate the provisions from the header of the search results table by right-clicking on the desired results > Validate Provision. This will enable you to log the information in the table and generate accounting entries.

In the provision validation window, enter the following fields:

  • Entry Date
  • Journal: This field is linked to the list of miscellaneous transactions journals.
  • Project: Provision entries will be generated on this project. If you do not enter the project, entries will be generated using the project from the invoice or from the lines of the invoice.

Example

I entered an invoice with 2 lines:

  • 1 line of €1.000 without tax on project T.
  • 1 line of €500 without tax on project T.

When generating provision entries:

  • If I enter Project A in the provision validation window, the entry will contain:
    • 1 line of €1.500 on Project A.
  • If I do not enter any project in the provision validation window, the entry will contain:
    • 1 line of €1.000 on Project T.
    • 1 line of €500 on Project M.

Note

Selected lines can be modified.

Only doubtful receivables can be changed to irrecoverable. To do so, follow these two steps:

Step 1: Change to irrecoverable

This action can be performed:

  • From a customer record sheet, via Edit > Accounting view > Doubtful account > Change to irrecoverable;
  • From a customers search results, via the Change to Irrecoverable feature;
  • From a sales invoice, via Edit > Doubtful account > Change to irrecoverable;
  • From a sales invoices search results, via the Change to irrecoverable feature.

Choose an entry date and a journal. The Journal field is linked to the list of miscellaneous transactions journals.

Step 2: Recover provisions

This action must only be performed if there is an existing provision.