Customer Statements

THERE ARE TWO METHODS OF PRODUCING CUSTOMER STATEMENTS:

 

  •             BALANCE FORWARD BASIS
            or
  •             OUTSTANDING ITEM BASIS
 
 
The difference between both methods of producing Customer Statements relates to the presentation of the statement through the degree of detail given to the customer.  Neither basis change the end closing balance figure.
 

BALANCE FORWARD BASIS EXPLAINED

If the Statement is showing an Opening Balance and a Closing Balance and only lists the invoices for the current month then the user has indicated the “Balance Forward Basis”.

 
To use the Balance Forward Basis, tick the box "Show opening balance followed by the transactions for the month" within 'Setup > Company Details'
 
If the customer account has transactions relating to Jan, Feb & Mar, as follows:
 
                                                                €
01/01/2016      Invoice                        1,000
15/01/2016      Invoice                           250
18/01/2016      RECEIPT                       (700)
20/02/2016      Invoice                           500
10/03/2016      Invoice                           300
12/03/2016      RECEIPT                       (300)
15/03/2016      Invoice                           150
 
 
 With the Balance Forward Basis, the statement as at a balance date of 31st March will show:
 
  •   all transactions prior to the current month are shown as an opening balance
  •   transactions for the current month listed
  •   closing balance reflected
 
 
EXAMPLE - STATEMENT TO 31st MARCH 2016                
                                                                 €
01/03/2016      Opening Balance       1,050 
 
10/03/2016      Invoice                        300 current month invoice
12/03/2016      RECEIPT                    (300) current month receipt
15/03/2016      Invoice                        150  current month invoice
 
31/03/2016      Closing Balance         1,200
 
 
 

OUTSTANDING ITEM BASIS EXPLAINED

 
If the statement is reflecting all unsettled invoices and/or unmatched receipts, regardless of the date of the transaction, then the user has indicated the “Outstanding Item Basis” presentation of the customer statement.
 
To use the Outstanding Item Basis, tick the box  "Show all unpaid invoices (i.e. invoices which have not been matched with a payment)" within 'Setup > Company Details'
 
If the customer account has transactions relating to Jan, Feb & Mar, as follows:
 
                                                                €
01/01/2016      Invoice                        1,000
15/01/2016      Invoice                           250
18/01/2016      RECEIPT                       (700)
20/02/2016      Invoice                           500
10/03/2016      Invoice                           300
12/03/2016      RECEIPT                       (300)
15/03/2016      Invoice                           150
 
 
With the Outstanding Item Basis, the statement as at a balance date of 31st March will show:
 
  • all invoices prior to the current month which remain unpaid listed
  • all invoices for the current month which remain unpaid listed
  • all receipts which have not been "matched" or "allocated" to an invoice are listed (regardless of date)
  • closing balance reflected
 
Under the Outstanding Item Basis, all transactions will be listed regardless of their date. The purpose of this method of preparing customer statements is that more control is given to the user to determine which invoice a receipt is settling when it is received.  This is an added management tool of customer accounts.
 
In order to determine the invoice being settled, the user must "match" or "allocate" the receipt to the invoice.  To do this a function is made available to the user under Tools>  Allocations>  Customer Receipts.
 
Choose the customer account.  To match the receipt, simply double click on the receipt and then double click on the invoice to which it relates. Click “Update”.
 
The above transactions may be matched/allocated as follows:
 
                                                                            €
01/01/2016      Invoice                        1,000
15/01/2016      Invoice                           250
18/01/2016      RECEIPT                       (700) MATCH AGAINST THE 1,000 INVOICE
20/02/2016      Invoice                           500
10/03/2016      Invoice                           300
12/03/2016      RECEIPT                       (300) MATCH AGAINST THE 300 INVOICE
15/03/2016      Invoice                           150
 
 
Therefore, after the user has completed the matching/ allocating process, based on the above transactions, the customer statement will be presented as follows:
 
 
STATEMENT TO 31st MARCH 2016   
                 
                                                                 €
01/01/2016      Invoice (Part)                  300   700 RECEIVED AGAINST THE INVOICE
15/01/2016      Invoice                            250
20/02/2016      Invoice                            500
15/03/2016      Invoice                            150
 
31/03/2016      Closing balance              1,200
 
 
Once the statement is prepared under this method it will only show the invoices which are unpaid, and if some invoices are partially paid then the statement will reflect the part outstanding for payment.
 
Please note: It is not necessary to match/ allocate receipts to invoices under the BALANCE FORWARD BASIS -  therefore the option to allocate is hidden from the user when this method of presenting the customer statements is chosen.

Need help? Support is available at 01 8352074 or support@thesaurus.ie.

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