Accounts Receivables Overview
1. What is Accounts Receivable?
2. What is the minimum transactional requirement to accounts receivable application?
3. What are the features in Peoplesoft’s Accounts Receivable Module?
4. How does one use Peoplesoft’s Accounts Receivable?
1. What is Accounts Receivable?
Accounts Receivable is a term used to refer to the dues that are receivable from the customers i.e. Sundry Debtors & Bills Receivable. These are short term dues for the business which are realised with in 1 year depending on the terms & conditions.
All businesses provide some credit period for the customers to pay their bills. When using accrual concept of accounting the businesses are required to recogonise the revenue as and when the sales invoice is raised. We pass the following accounting entry
Sundry Debtors A/c Debit
Sales A/c Credit
and when the amount is realised from the customer we pass the following accounting entry
Bank A/c Debit
Sundry Debtors A/c Credit
2. What is the minimum transactional requirement of accounts receivable application?
i) Ability to record invoices and their due dates.
ii) Ability to record payments for each invoice. The customer may pay for each invoice separately or give a single payment for more than one invoices.
iii) Ability to handle various methods of payments. Payments can be in the form of
Cheques & Demand Drafts
Direct Debits or ECS
Drafts or Bill of Exchanges or Promissory Notes or Letter of Credits
Other Electronic Payments like Credit Card Payments
iv) Ability to handle various situations like:
Over Payments
Under Payments
Deductions
Prepayments
Transfer invoice & payments from one customer to another
v) Aging Analysis: Ability to generate reports showing the number of a days an invoice has remained unpaid.
vi) Dunning: Ability to generate intimations / notices to customers for who have missed the due dates of payments.
vii) Customer Handling: Ability to access customers accounts for answering customers queries or recording complaints regarding various invoices etc.
3. What are the features in Peoplesoft’s Accounts Receivable Module?
Record invoices and their due dates.
Record Payments – Cheques & Demand Drafts.
Record Payments – Direct Debits.
Record Payments – Drafts.
Apply Payments to Invoices.
Automate the process of applying payment to Invoices using Payment Predictor to handle large volume data processing.
Refund of Credit balance to customers
Aging Analysis
Dunning
On Account Payments, Transfers
Additional Processing for VAT
4. How does one use Peoplesoft’s Accounts Receivable?
How to create an Invoice?
Path – Accounts Receivable -- Pending Items -- Online Items -- Group Entry
After entering the invoice run AR_UPDATE using the following path
Path – Accounts Receivable -- Update Receivables -- Request Receivable Update
To create accounting entries click on the thunder bolt symbol.
To delete the created accounting entries click on the eraser symbol.
To post the invoice choose from the options. Use Batch Standard or Batch Priority by default. If you want to post immediately use Post Now.
How to create a payment?
Navigate to Accounts Receivables -- Payments -- Online Payments -- Regular Deposit
Once the payment is created, you can match the payment with invoice using the payment predictor or payment worksheet.
To Create a payment worksheet navigate to Create Worksheet and enter the payment details and click on search. Once the payment is shown click Build to create the payment worksheet.
Select the invoice that you want to attach to the payment and click save. Then on the Payment Worksheet Action select Batch Standard or Batch Priority. If you want to post the payment immediately then choose Post Now.