Creating Debt Collection Assignment for Past Due Customer Invoices

Outcome

A collection assignment is created and printed, displaying all past due accounts receivable invoices - including interest invoices - per customer and currency. The list contains the following information, apart from the opening and closing comments:

• Invoice number, invoice date, due date, currency, and remaining amount. Information on the payer, telephone numbers, and organization numbers is retrieved from 'Customer. Open' (CRS610).
• The invoices included in the assignment can be reviewed in 'Accounts Receivable. Display Additional Information' (ARS250) even after the assignment itself is deleted in 'Collection. Open Assignment' (ARS170).

You can send the collection assignment to a collection agency.

The collection assignment has status 9 and cannot be processed further. It is saved in the following collection files: FCOLL1 (listing name and status of all reminders), FCOLL2 (listing payers), and FCOLL3 (listing invoices).

No new transactions are created.

The collection assignment is automatically allocated information category number 208 and saved under its assignment number (see Outcome).

Before you start

• The starting conditions listed in Managing customer debts must be met.
• The cost for hiring the services of a collection agency and the user's administrative costs connected with collection must be weighed against the total past due amount before deciding whether an invoice should be sent for collection.
• Number series type 50 under number series 4 must be defined for collection assignments in 'Number Series. Open' (CRS165). Note that the number series is not needed when only creating a collection assignment proposal.
• The Collection parameter must be activated for the payer/customer in 'Customer. Open' (CRS610/K).
• There must be past due accounts receivable records for the payer with debt collection code 1. The code is automatically set if the number of payment reminders sent to a customer exceeds the number specified in 'Payment Reminder Rule. Open' (CRS465/E). It can also be changed manually for each invoice in 'Customer Invoice. Change' (ARS201); the program can be called from 'Accounts Receivable. Display' (ARS200) or 'Customer Invoice. Display Separate' (ARS215).
• If you wish to use standard texts for opening and closing comments in the collection assignment, these are defined per language in advance in 'Collection. Enter Text' (ARS085).

Follow these Steps

1. Create and Verify a Collection Assignment Proposal

   Create a proposal in 'Collection. Open Assignment' (ARS170) by specifying up to ten different selection criteria. Review the proposal to make sure it is correct. An invoice is usually not included in the collection routine until a specified number of payment reminders has been sent to the payer.

2. Adjust the Collection Assignment Proposal

   If there are any incorrect records in the proposal, adjust it by blocking or deleting payers or invoices to prevent them from being included in the final collection assignment. This is done in (ARS176); the program is called via (ARS170).

   You can also add or adjust opening and closing comments to be printed on the collection assignment in (ARS175), which is called via (ARS170). If standard texts are defined, these are automatically retrieved but can be changed. See Before Starting.

3. Create the Final Collection Assignment

   Create and print the assignment by confirming the proposal in (ARS170). Note that the collection assignment cannot be changed or reviewed on screen after it has been printed.

4. Send Assignment to Collection Agency

   Send the collection assignment to the collection agency with copies of the past due invoices. Since the assignment is saved under an information category number, it can then be deleted in (ARS170) – see Results.

Using Block Codes in the Collection Processing

Each customer invoice has a collection block code in M3. It is set automatically but you can change it manually in 'Customer Invoice. Open' (ARS201/E), a subprogram to (ARS200). These block codes control which invoices are included in the final collection assignments and, consequently, the result of this process.

The following statuses are used:

0 = Collection is not activated

1 = Collection threat, that is the number of payment reminders exceeds the limit for collection

2 = The invoice is transferred for collection

3–8 = User-defined codes for blocking the invoice from collection.