SECTION 1.3.3 - DEBTOR ADJUSTMENTS
USAGE: To apply ad hoc debits and credits to Debtors. This is useful for shifting balances between accounts, and for making entries that do not affect the bank. This function is capable of shifting balances from Debtor to Debtor, Debtor to Creditor and Debtor to General Ledger.
DISCUSSION: Debtor Adjustments or Journals are used in many procedures or adjust or fix balances. There are several examples:
· If you wish to write off a Debtor’s balance you could enter a Debtor to General Ledger adjustment where the General Ledger account is the Debtor Write-off account.
· Special Charges such as interest can be applied via adjustments, as long as you do not need to print an invoice.
· If you have invoiced the wrong Debtor, you should normally enter a Credit Note and a new Invoice, but if the Invoice has already been paid, you can shift the balance to the correct Customer by a Debtor to Debtor adjustment.
· If a Debtor that has been billed as a multiple of customers but now wishes a consolidated bill, you can consolidate the balances via Debtor to Debtor adjustments.
· Similarly, if a large customer pays multiple accounts via a single cheque, you can enter the whole cheque into one account and then shift the remaining value to the other account. (Adjustment can be allocated just like any other transaction.)
· To mimic reality, if you contra a bill, you can directly adjust a balance in Debtor and Creditors in one go.
When you start the DEBTOR ADJUSTMENT program, the computer will initially ask for a Debtor code. Insert the code and press <Enter>.
To return to the DEBTOR DATA ENTRY MENU, press <ESC>.
To search for a Debtor, press <F9>. For further details on searches, see SECTION 1.2.
Having chosen a Debtor, the screen will display the name and address and recent balances, in full at the top of the screen. The screen will appear as follows:
By default HiFinance will offer the Debtor to General Ledger option. If you wish to continue, enter a General Ledger account number (eg Debtor Write-off) and press <Enter>. You can also use <F9> to search for a General Ledger account.
There are certain accounts that HiFinance will stop you from posting to, eg Bank, Trade Debtors. These are only posted to via other programs, eg Invoicing.
If you wish to enter a Debtor to Debtor adjustment, press <F2>. The screen will change to:
Here you can choose a second Debtor to post to. You can use <F9> to search for a Debtor. This must be a different Debtor account to the first one, and you cannot post to Debtor sub-accounts (ie Debtors with a / in their code).
If you wish to enter a Debtor to Creditor adjustment, press <F3>. The screen will change to:
Here you can choose a Creditor to post to. You can use <F9> to search for the Creditor.
Irrespective of whether you are posting to a General Ledger account, another Debtor or a Creditor, when you choose the second account, HiFinance will display the current balance of that account. The format depends on what kind of account it is.
The screen will now split into 3 parts. The top section is the Debtor details, the middle section shows the second account’s details, and the bottom section allows you to enter the details of the transaction.
An example is:
The fields available are:
DATE This is date you wish to make the transaction apply. The date does not have to be in the current period, but if you backdate a transaction, HiFinance will not let you choose a date in a closed period. To close a period, use the CALENDAR function. (See SECTION 7.1.6.)
COMMENTS Here you must enter the reason for the Adjustment.
VALUE This is the value of the transaction. By default, this is a debit amount, ie it will increase the balance of the first Debtor. To change it to a credit value, press - . When you leave this field, HiFinance will update the NEW BALANCE fields on both accounts (sections 1 and 2 of the screen) to show you what the effect of you entry would be, but the balances will not actually be changed until you choose to update.
<F8> If you wish to return to section 2 of the screen, press <F8> or <CsrUp> at the date field. This may be more efficient than pressing <ESC> and restarting the transaction.
<F9> This will initiate HiFinance’s calculator. When you press <ESC> from the calculator, the result will be inserted into the value field.
<ESC> To abort the whole transaction, press <ESC>. You will then be returned to the Debtor code entry routine.
To finally update your transaction, press <F10>. You might be asked if you wish to allocate the transaction depending on the transaction type. If you choose Y, you will be transferred to the relevant allocation program and on completion, you will be returned to the adjustment program.
Files updated by the Debtor Adjustment program:
Debtor master-file: The first Debtor’s balance will be increased by the value of the transaction. If you are entering a Debtor to Debtor transaction, the second Debtor’s balance will be reduced.
Debtor transaction-file: A transaction is created to match each balance updated.
Creditor master-file: If you are entering a Debtor to Creditor transaction, the Creditor’s balance will be increased.
Creditor transaction-file: A transaction is created to match the balance updated.
General Ledger master-file: If you are entering a Debtor to General Ledger adjustment, the relevant General Ledger account will be updated. If you are entering a Debtor to Debtor adjustment, no General Ledger involvement is required. However, if you are entering a Debtor to Debtor or Debtor to Creditor adjustment, the Trade Debtors and, where relevant, the Trade Creditor’s accounts are adjusted.
General Ledger transaction-file: A transaction is posted for each transaction line.