Collection
Money received from a customer. A collection says who paid, which open invoices (or orders, or bills) the money clears, what was withheld or charged on the way, and which bank or cash account it came into. Save with Posting Status Posted is the posting.
What it is for
The transaction journal picked first decides what the money is for:
- Against invoices. On Create the Clearings tab lists the payer's posted, uncleared invoice schedule lines, its posted credit memos and its advances, in the collection's currency. Tick the lines being paid.
- Prepayment against sales orders. The Clearings tab lists the payer's sales orders that can take a prepayment.
- Property billing. Pick the Billing Proposal; the bill's lines and its payment lines are filled in. Partial clearing is allowed only if the real estate settings allow it (see Required Partially Clearing on Real Estate Setting).
- Advance. No invoices are listed. The amount is an open credit on the customer, cleared later by a collection against invoices or a Customer Settlement.
- Other receipts. A journal not for a customer or vendor hides the payer fields; each clearing line names its own account.
A journal for vendor receipts lets a vendor be the payer, for example a vendor refunding a debit balance.
The one rule people get wrong: the total of the Collection Through tab must equal the Net Receivable Amount, to the cent, or the save is refused.
Every field in plain words
General
| Field | What it means | What to put |
|---|---|---|
| Transaction | The collection number | Given on Create |
| Posting Date | The date the money is posted on | Required. Fills Exchange Date and the Financial Year and Period. Locked after Create |
| Transaction Journal | The kind of collection and its numbering | Required. Only journals valid on the posting date. Locked after Create |
| Posting Status | Posted or Park | Defaults from the journal |
| External Reference, Internal Reference | The customer's reference, your own reference | Optional |
| Notes | Free text | Copied to the Line Text of the clearing, withholding and fee lines you add |
| Journal, Journal Indicator, Financial Year, Financial Period | From the journal | Read-only |
| Billing Proposal | The property bill being paid | Property billing journals only |
Controlling
| Field | What it means | What to put |
|---|---|---|
| Payer Entity | Customer or vendor, from the journal | Read-only |
| Payer | Who paid | Required on customer and vendor journals. Locked after Create |
| Alternative Payer | Another party allowed to pay for this payer | Picked from the payer's Alternative Payers list on Customer In Legal Entity |
| Payer Name | The payer's name |
Currency Information
Currency (starts in the company's currency), Exchange Date and Exchange Rate. The rate is fetched for the exchange date and cannot be zero. Currency is locked after Create.
Clearings
| Column | What it means |
|---|---|
| Selected | This line is being paid |
| Full Settle | Pay the whole balance: fills Transaction Clearing Amount with what is left |
| Transaction, Origin | The invoice, memo or advance, and what kind it is. The number opens the document |
| Schedule | The invoice's instalment |
| Origin Amount, Settled Amount, Balance Amount | The document's amount, what was cleared before, what is left |
| Transaction Clearing Amount | What this collection clears, in the collection's currency. Positive for invoices; a memo or advance line takes a negative amount, so it offsets invoices in the same collection |
| Account, Name | The account of the line (advance and other-receipt journals) |
| Line Text | Shown when Required LineText On Collection is ticked on Account Receivable Setting |
Hidden columns hold the origin currency and rates, the exchange gain or loss on a foreign-currency invoice, the tax split, and the authority invoice number (shown when the company uses digital invoicing).
Auto collection (toolbar): type an amount, and it is spread over the listed invoices in order, each paid in full until the amount runs out.
Adjustments
Shown only on collections against invoices or property bills, unless hidden on Account Receivable Setting.
| Column | What it means |
|---|---|
| Currency, Exchange Rate | The adjustment's currency. Required |
| Adjustment Type, Account | The reason and its account, from Adjustment Type. Required |
| Adjustment Amount | The amount written off or allowed |
| Reason, Line Text | Why |
Payment Fee
| Column | What it means |
|---|---|
| Currency, Exchange Rate | The fee's currency and rate |
| Payment fee, Account | The fee, from Payment fee. The account of a general ledger fee cannot be changed |
| Fee Amount, Tax Group, Tax Zone, Tax Amount, Fee Amount Including Tax | The fee and the tax on it, worked out from the tax zone and group |
Withholdings
On Create, the payer's (or alternative payer's) default withholding tax from Customer In Legal Entity is added.
| Column | What it means |
|---|---|
| Withholding Tax Code | The tax withheld by the customer (section 153 in Pakistan, for example). Required |
| Account, Tax Percentage | From the tax code's posting profile |
| Withholding Amount | Worked out from the selected clearings: on the amount excluding tax, the tax, the amount including tax, or the whole payment, as the tax code says, then rounded by the code's rule |
| Withholding Manual | Tick to type the amount yourself |
| Calculated Amount | What the system worked out, kept for comparison |
Collection Through
How the money arrived. The tab shows the Net Receivable Amount and what is still to be accounted for.
| Column | What it means | What to put |
|---|---|---|
| Currency, Payment Method | How it was paid | Required. The method fills its default account and whether it is a bridging account |
| Account | The bank or cash account | Required |
| Bank, Deposite Slip Number, Instrument No, Instrument Date | The cheque or transfer details | Optional |
| Tracking Number | The receipt number | Shown with Required Tracking Number In Collection on Account Receivable Setting; required when the payment method asks for it |
| Payment Amount | The amount | Required |
| Bridging Posting | The account is a holding account | Read-only. Deposit and Cleared are locked on such lines |
| Deposit, Deposit Date, Cleared, Cleared Date | When the cheque was deposited and cleared | |
| Modify Payer, Payer | Another name on this line |
Totals
Transaction Clearing Amount, Collection Fee, Adjustment Amount, Receivable Amount, Withholding On Tax Amount, Witholding On Income, Withholding Tax Amount, Rounding Difference and Net Receivable Amount. The net is the clearings and fees, less the withholding, rounded by the currency's rule for receivables, with the adjustments added. Net Receivable Amount cannot be negative.
How to configure it
- One journal per kind of collection and, if wanted, per cashier or branch.
- Hide the Adjustments, Payment Fee and Withholdings tabs a company never uses on Account Receivable Setting.
- For cheques that clear later, use a payment method with Bridging Posting; the move to the bank is made on Bank Transactions in Cash and bank. See How do I clear a cheque?
Scenarios
- A customer pays three invoices with one cheque, less withholding tax. Journal against invoices, payer the customer, Full Settle on the three invoices; the default withholding tax is worked out; one Collection Through line with the cheque.
- The customer short-pays by a small amount. Clear the invoice in full and add an adjustment line for the difference with a small-balance adjustment type.
- The bank deducts a charge. Add a payment fee line; the bank line is the amount actually received.
- The customer pays before ordering. Advance journal. Clear it against the invoice later.
- The customer has a credit memo. Select the memo (negative amount) and the invoice together; only the difference is collected.
- The head office pays for a branch. Payer the branch, Alternative Payer the head office.
What posts
| Document | When | Debit | Credit |
|---|---|---|---|
| Collection | Save | Each Collection Through line's account (bank, cash or holding account); the fee and adjustment accounts; the withholding tax accounts | The customer's receivable account for the amount cleared (or the clearing line's own account on other receipts); exchange gain or loss on foreign-currency invoices |
The lines are laid out by the posting keys of this screen on Process Post Key in General ledger. Undoing a posting is Reverse on the toolbar; the invoices it cleared are open again.
What it is connected to
- Customer Invoice and Customer Invoice Memo are cleared here.
- Payment Method, Payment fee, Adjustment Type, Tracking Number Setup.
- Customer Settlement clears advances later.
- Batch Posting posts parked collections.
- Lists and reports: Receipt Voucher, Collection, Customer Collection lists.
- Billing Proposal in real estate - collected here with the billing proposal journal indicator; see How do I record a buyer payment?.
- Order to cash - the whole sales process this collection closes.
If something looks wrong
- "No clearings have been found." The payer has nothing open in this currency: no posted invoices, or all are cleared or stopped.
- "Exchange rate cannot be zero or negative" / "Exchange Rate cannot be zero". Enter a rate for the date.
- "Total Amount: ... in Collection Through must be equal to Net Receivable Amount: ...". Make the Collection Through lines add up to the net.
- "Net Collection Amount: ... cannot be negative." The withholding, memos or adjustments exceed what is cleared.
- "Clearings - Line ID: ... - Clearing Amount cannot be zero or negative". A selected invoice line needs a positive amount.
- "LineID: ... Clearing Amount: ... cannot exceed Balance Amount: ...". You are clearing more than is open.
- "LineID: ... - ... is already fully paid." / "... is already fully settled." Someone cleared it in the meantime. Untick it.
- "LineID: ... Customer is not Mathcing with Invoice" (or Invoice Memo, Advance). The document belongs to another customer.
- "LineID: ... Clearing Amount: ... cannot be zero or greater than zero". A memo or advance line takes a negative amount.
- "Clearings - Line ID: ... - Account cannot be empty". Advance and other-receipt lines need an account.
- "Collection Through - Line ID : ... - Payment Method cannot be empty" / "... Account cannot be empty". Fill both.
- "Collection Through - Line ID : ... - Collection Through Tracking Number cannot be empty". The payment method requires the receipt number.
- "Withholdings - Line ID : ... - Withholding Taxcode cannot be empty" / "... Withholding Amount cannot be empty". Complete or remove the withholding line.
- "Adjustments - Line ID : ... - Adjustment Account cannot be empty" / "... Currency cannot be empty". Complete the adjustment line.
- "Collection Fee - Line ID : ... - Currency cannot be empty" / "... Collection Fee cannot be empty" / "... Account is not configured on Collection Fee: ...". Complete the fee line, or give the fee an account.
- "Line ID: ... is duplicated with Line ID: ... of this Invoice ...". The same invoice instalment is on two lines.
- "Payment: ... cannot be deleted / cannot be reversed. Following Collection/Payment have been raised against it". A later document used this collection (an advance cleared elsewhere). Reverse that first.
- "Payment: ... cannot be deleted / cannot be reversed. Following Bank Transaction have been raised against it". The money was moved on with a bank transaction. Reverse that first.
- "Posted invoice cannot be deleted". A posted collection is reversed, not deleted.
- "Only Posted Vouchers can be reversed" / "Reverse Date: ... cannot be less than Posting Date: ...". Delete a parked one; pick a later reverse date.