The Customer Payments on File process is used to create customer payments out of electronic files received from various payment institutes. An agreement exists between the company and the payment institute regarding the electronic payment files service. Each electronic file contains payment information and matching information for a specific account and currency for existing invoices in Accounts Receivable.
In IFS Financials, there are accepted, predefined file layouts for payment institutes for some countries.
Optical character recognition (OCR) files for Denmark, Finland, Norway and Sweden are also available. These files include payment transactions against customer invoices.
The payment reference is the unique identifier for each invoice in the file. It is used to match the incoming payment transactions in the external files, with the existing invoices in Accounts Receivable. For customer invoices, the payment reference is calculated when the invoice is printed. It is calculated as follows:
Series ID + Invoice number + a check digit
This calculation is defined according to the rules set up at company level, i.e., in Customer Invoice Creation Method. The payment reference is printed on customer order invoices, instant invoices, and interest invoices.
When the OCR files are loaded, the payment transactions are automatically matched and checked. If the payment reference exists in accounts receivable, the amount of the payment transaction in the file is matched against the open amount of an installment in the invoice. If there are several open installment lines for an invoice, then the installments are handled in ascending discount or due date order. If the payment amount is lesser than the open amount of the installment the installment will be partly paid. If the payment amount is greater than the open amount of the installment of the invoice, the installment will be fully paid and the rest, if there are no other open installments of the invoice, the balance will be posted as a payment on account for the customer. If the invoice already is paid (open amount of invoice is zero and no open installments exist) then there will be a payment on account. If the payment reference does not exist in Accounts Receivable there will be a parked payment, i.e., the company code is set as the customer identity. When the paid amount in the file is matched against the open amount of an installment, it considers discounts, deductions, and tolerances at the installment identity level.
You can also load, return files of previously created direct debiting files. The direct debiting files are created in the direct debiting process and sent to the payment institutes. In turn, the company receives the return files from the payment institutes. The direct debiting files sent to the payment institute includes customer payment transactions that should be automatically withdrawn from the customer's bank account and deposited into the company 's bank account. Therefore, the return file is an acknowledgement of the previously sent transactions that have been successfully handled by the payment institute. The return files can also include return debit notes referring to an invoice for which the customer payment transaction has been already acknowledged. For the return transaction of the Swiss Direct Debiting Return file, a new difference item is created in Accounts Receivable to reestablish the claim against the customer and to debit the company's bank account.
Customer payments included in payment files with an unstructured reference are matched by using identifiers. Various identifiers are available to analyze the content of the external file in order to find the information in IFS/Financials for the payment matching, such as customer invoices, customers and issued checks. Apart from pending transactions to be matched with information of accounts receivable, direct cash payments are automatically completed with a manual posting based on the identifier setup.
When the file is loaded, the matching and checking is automatically
performed. One load ID is handled as a whole, and if there is an erroneous transaction, the whole load ID is considered as erroneous.
Any errors encountered must be
corrected. If the paid amount covers
several installment lines, the installment identity is blank at the level
External Payment Details, but at the level External Payments Matching Details, the
installment lines matched are
shown with used discounts, deductions and tolerances. The matching
details includes customer difference items to write off overpayments or
underpayments within specified tolerances, or of an exact amount.
When the whole load ID is complete, i.e., when every transaction is correct,
the next step is to transfe the
load ID with its transactions into an existing or new mixed payment. To approve
the mixed payment, a separate function is used. The approval creates payments in
Accounts Receivable and a voucher with postings. When the payment is matched,
the matched invoice and payment will be assigned with a unique matching ID
and a matching date. For unmatched payments, new items will
be created for the affected customers or parked payments, if the payment has no
reference to a customer.
Each electronic file contains information on debit and credit payment
transactions for a specific cash account and currency. The transactions take
place in the following steps:
An approved mixed payment can be cancelled. The
cancellation reverses all accounting transactions that were created in
connection with approval.
Before you start entering information, the Basic Data Required (BDR)
has to be set up as per instructed in the Define Financials Basics. They are,
the Set up
Basic Data Accounts Receivable process, and the Cash Book Basic Data, for
payment institutes and payment methods,
and the Basic Data Requirement (BDR) for External Payments.