Overpayments

Run the ARSPOV utility is to apply overpayment transactions to outstanding account receivables. When a customer overpays on an invoice, the payment on outstanding invoices is applied on the CR Summary tab (ARBTCRIC). The overpayment is applied on the CR Lonesome (Direct) Cash tab.

The overpayment is not applied to a particular invoice. The overpayment is instead applied to the customer's account and an object code that represents "Unapplied Cash." When the customer has additional invoices to be paid, this process allows for the "Unapplied Cash" to be applied to outstanding invoices. This should occur prior to invoicing the customer and should also reduce the outstanding balance on the invoice for calculating late charges.

This special function will allow the user to select which transactions qualify as Unapplied Cash using selection criteria. The customer's transactions will be analyzed to determine which ones qualify as Unapplied Cash. For example, the user can select all CR transactions that have Object Code 1000 (Unapplied Cash). This pool of selected transactions will comprise the net outstanding Unapplied Cash amount. The system will apply this amount to out-standing transactions (i.e., invoices) using the same auto payment logic in the CR Summary screen. That is, the payment will be applied to outstanding balances as if the user had entered the payment into the CR Summary screen. However, note there will be absolutely no user interaction to override the application of the overpayment to one invoice or another. The system will follow the same rules as the CR Summary screen does, for example, paying off the oldest charge first. Any modification of the system's application of the overpayment may be done by editing the CR Batch after the utility has generated the batch.

For the setup, it is common to have the following:

• Define an object code that represents "Unapplied Cash"
• Define an AR division of OVER in ARUPCD
• Define a posting codes/posting strategy for the overpayment records

Example
Customer #1 has AR Inv#1 for $100. They overpay the invoice by sending a check for $125.
In ARBTCRIC, on the summary tab, $100 is applied to AR Inv#1 and on the Direct Cash tab, the $25 overpay is entered with the Hit AR checked, Division OVER, the Unapplied Cash Object code.
Now Customer #1 has AR Inv #2 for $25.
Run ARSPOV:

• The first selection criteria is used to tell the process "who qualifies." Select on Account ID and enter Customer #1. Enter the name of the new CR set ID, e.g., CROVER1.
• The second AR selection criteria menu is used to tell the process "which transactions qualify." Select on the Unapplied Cash Object code.
• Submit the job.

Review the results in ARBTCRUB by locating Set ID CROVER1. The set will have a record for a positive +$25 referencing AR Inv #2 and a record for a negative -$25 with the Unapplied Cash object to "wash-out" the overpay record. This set then needs to be posted.