Accounts Receivable Features and Objectives of AR System

Legler Systems Company

AR Features

Accounts Receivable Features and Objectives:

The primary objective of the Accounts Receivable System (AR System) by Legler Systems is to process accounts receivable information in an online environment, so specific online procedures are performed in seconds rather than the hours required for traditional batch methods of computer processing. This AR System performs the basic accounts receivable objectives by providing a complete and accurate record of all accounting transactions affecting each customer.

Specific accounts receivable features and objectives of this business software application are highlighted below:

Maintain Customer Master Record for each customer of the company. Information in this master record includes customer name, address, sales tax rate terms, credit dollar limit and standard general ledger revenue account codes. The Customer Text Record (optional) stores the customer's web address, e-mail address and cell phone number.
Maintain a Customer Invoice Record on the dollar amounts to be collected from customers, as well as the actual general ledger revenue account codes. One record for each customer invoice.
Automatic voucher number assignment is done when new customer invoice transactions are added to the AR System for voucher number control and audit trail purposes. This automatic voucher number assignment feature can be overridden by the setting of System-Option-16 (DB03), so the voucher number must be manually assigned and entered.
Automatically post dollar amount and revenue account code information from Customer Invoice Records to General Journal Records in the online General Ledger System (AR09) by accounting period (YRMO) to eliminate clerical posting errors. Either the cash accounting method or accrual accounting method is supported. This accounts receivable objective minimizes the clerical data entry workload depending on the setting of System-Option-04 (DB03). If System-Option-04 is set to "2", these General Journal Records are written to a Transfer File for input to an external general ledger application.
Print accounting reports, such as Customer Invoice Report, Cash Receipts Report, Aged Receivables Report, Receivables Distribution Report and other reports to provide an audit trail of accounting data entered into the system, so adequate control is maintained over company cash receipts and GL revenue distributions.
Print customer Account Statements (AR11) showing the invoices issued during the period and customer payments received.
Automatically calculate the average days delay between the invoice date and the date the customer payment is received and store this information in the Customer Master Record.
Handle cash sales associated with customer invoices.
Allow for the receipt of a partial customer payment against a single customer invoice. Up to four partial customer payments can be entered for one customer invoice. Procedure AR03 is used to enter a partial customer payment against a single invoice.
Print Past Due Notices (AR12) showing all unpaid customer invoices and calculate a customer finance charge when requested by the user. New Customer Invoice Records can be automatically created to reflect this customer finance charge.
Provide reporting capability by different locations. The location code used by this system should be consistent with that used by other financial systems installed at the company.
Provide auxiliary data input capability for initial file creation and processing customer invoice transactions created by other computerized systems, including separate data entry operations. Multiple customer invoice transactions are processed at one time by procedure AR14.
Handle any fiscal year for accounting purposes, even one different from the calendar year, through the use of a separate accounting period number (YRMO) field.
Provide source document control over input invoice transactions to the computer by assigning a batch number to a group of customer invoices. This batch number control feature aids in providing a complete audit trail of documents processed. If no batch number is entered, the system date (YRMODA) is assigned to the AR batch number field for positive batch number control.
Provide online inquiry capability to identify all invoices and payments received for a specific customer.
Provide online inquiry capability to identify all invoices associated with a specific customer and to summarize payments by month for the last five years.
Define an Active-Flag for each customer to prohibit online entry of new invoice data for an inactive customer, yet reference that old customer number for historical reporting purposes.
Handle multiple bank accounts through a user definable Bank-ID code.
Automatically update the Customer Master Record with amounts received in the latest calendar year with automatic internal rollover from one year to the next, so special year-end clerical procedures are avoided.
Provide the capability to create custom AR reports where the user defines the data fields to be selected, sorted and printed. Procedure DB12 is a general purpose custom report writer that produces custom AR reports.
Provide the capability to enter customer prepayment information in AR03 and automatically update the actual invoice when it is added to the AR System by procedures AR02, AR14 or OE05. This customer prepayment information stored in a temporary Customer Invoice Record.
Customer payment application allows the updating of multiple customer invoices at one time from a single customer payment using procedure AR18. Also, customer payments can be applied to each individual customer invoice using procedure AR03.
Allow the user to specify the sequence of records in a report by entering a primary (customer) and secondary (invoice) sort option.
Automatically display a detail record (screen AR01, screen AR02 and screen AR03) when function key F7 is pressed from data entry procedure AR03 and procedure AR02 and from inquiry procedure AR10 and procedure AR15. This accounts receivable objective enables the operator to quickly drill down to more specific information.
Select customer invoices with a credit balance, invoices with a net balance less than x dollars, or invoices with net balance greater than y dollars when printing the Aged Receivables Report (AR07) and Outstanding Invoice Report (AR16).
Verify the state code and ZIP code (first 3 digits) associated with a customer address. The Canadian province code is validated when the ZIP code is not numeric.
Automatic customer number lookup occurs whenever the customer name initials are entered as the customer number for fast customer number lookup. The customer name initials are manually or automatically set in the Customer Master Record when it was created to aid in looking-up or finding a customer number. For customer number lookup by name, enter the "#" character as the customer number and when prompted, enter the customer name or telephone number.
Automatically test for duplicate invoices at the time of entry of new customer invoices. This option is set by System-Option-25.
Establish a Sales-Tax code to identify different sales tax rates and store it in each Customer Master Record to minimize file updates associated with a sales tax rate change. This accounts receivable objective allows the user to define multiple county Sales-Tax codes.
Provide system options in the Company Control Record to handle 6-digit dates or 8-digit dates for data entry and reporting purposes.
In addition to online processing, batch job processing is supported where multiple AR report requests are entered online for later batch processing.
Easily enter notes or comments on a specific customer (AR01) or invoice (AR02) when the Trans-Code is set to "N" to automatically link to procedure DB17 (General Notes Record) in the DB System.

Customer prepayment information can be entered into the Accounts Receivable System as a Customer Invoice Record prior to entry of the actual invoice where a temporary record is created with a special invoice number (PPNNNN). When the actual invoice is added to the system, customer prepayment information is automatically moved to the new invoice and the temporary prepayment record is deleted.

The Accounts Receivable System keeps track of unpaid customer invoices and partial customer payments against an invoice. The Aged Receivables Report (AR07) can be printed at any time to identify the total dollar amount of all unpaid invoices by customer. Individual unpaid customer invoices are identified in the Outstanding Invoice Report (AR16).

Customer Account Statements (Statement of Accounts) and Past Due Notices are printed on letter-size paper for direct mailing to customers with the company heading format specified by System-Option-12 (DB03).

The AR System procedures that can be run by the user are identified in the Accounts Receivable Menu document.

Customer Master Record:

Customer name, address and other information is stored in the Customer Master Record. Online procedure AR01 is used to add, change (modify), query or delete Customer Invoice Records by entering a specific customer number. For new customers, automatic customer number assignment is done by the AR System when the customer number is blank. The customer name and address printed on customer Account Statements and Past Due Notices is from these master records.

The primary key of the Customer Master Record (CMR) is the Record-Type code and customer number. Five alternate keys are defined for rapid access to different groups of CMR data.

Customer Text Record:

Customer's web address (URL), e-mail address, cell phone number and resale number are stored in the Customer Text Record. Online entry procedure AR01 automatically displays and updates these fields in the Customer Text Record.

The primary key of the Customer Text Record is the Record-Type code and customer number.

Customer Invoice Record:

Information about each invoice mailed to a customer is stored in a separate Customer Invoice Record for tracking customer payments of the services performed and products sold. Online procedure AR02 is used to add, change (modify), query and delete Customer Invoice Records. For all new customer invoice entries, the voucher is automatically assigned using a sequence number counter in the Company Control Record (DB03) for positive voucher number control. This sequence number counter (SEQNO-1) is incremented by one every time a new customer invoice is added to the online database. Procedure AR03 is used to modify these invoice records with customer payment information.

The primary key of the Customer Invoice Record (CIR) is the Record-Type code, customer number and voucher number. Five alternate keys are defined for rapid access to different groups of CIR data.

General Journal Record:

At the end of the month, procedure AR09 is run to create General Journal Records summarizing GL account code transactions depending on the setting of System-Option-04 (DB03). These General Journal Records are subsequently processed by the General Ledger system (optional) for accounting record keeping and financial reporting. Alternatively, procedure DB18 can be used to export an ASCII file of comma separated values (csv) containing data fields from these General Journal Records.

The primary key of the General Journal Record (GJR) is the Record-Type code, accounting period (YRMO) and voucher number (SEQNO-1). Five alternate keys are defined for rapid access to different groups of GJR data.

More Information on the AR Software:

For additional information on this online Accounts Receivable software and a free CD-ROM demo, e-mail Bill Legler in the SF Bay Area, California or go to the Accounts Receivable System main page.