KUALI FINANCIAL SYSTEM (KFS)
ACCOUNTS RECEIVABLE TRAINING
WELCOME!
SEPTEMBER 2015
JIM HEWLETT
ANALYST
High-Level Overview
•
What is Accounts Receivable (AR)?
•
High-Level Overview of AR Process, Authorization, Separation of
Duties, Policies and Procedures
•
AR Maintenance Documents
•
AR Transaction Documents
•
AR Reporting in KFS and FIS Decision Support (DS)
•
Other Help Resources
Note on this Training
• In addition to KFS AR, departments have
option of using Banner or establishing
Feeds for AR transactions
• This training does not cover those options
• Refer to the Accounting website for more info on
Banner and Feed options (go to afs.ucdavis.edu,
click on Systems Information, and Document
Help for help instructions/information on
Accounts Receivable for KFS AND Banner)
What is Accounts
Receivable?
• Accounts Receivable (AR) represent
money due for services performed or
merchandise sold to external nonuniversity customers (e.g., individuals and
organizations outside UC Davis).
Accounts Receivable Process
1. Receive authorization to sell goods or services
(if more than $500/year)
2. Provide the good or service
3. Invoice for the good or service
4. Run monthly aging reports
5. Collect payment, or send billing statements
6. Write off as bad debts (as last resort)
Accounts Receivable
Authorization Process
•
Billing for less than $500.00 annually (total
across ALL customers) - Department chair
approval is generally the only approval needed,
with completed/signed business contract. See
http://manuals.ucdavis.edu/ppm/340/34009.pdf
•
Billing for $500.00 or more on a ONE-TIME
basis - Submit a completed Special
Sale/Service Authorization form to the
Contracting Services Office.
AR Authorization Process
•
Billing for ONGOING services or goods - If your department
plans to provide ongoing fee-based services or goods to
UCD departments, other UC campuses, or to external
parties, your department should request a rate (contact
your dean’s office for assistance).
• After rate has been approved, Accounting & Financial
Services (A&FS) will assign fund number for activity
(assigned to self-supporting sub-fund group).
•
Billing for agricultural by-products - Submit a Request for
Disposition of By-Products form (see
http://manuals.ucdavis.edu/ppm/340/340-09.pdf)
•
Additional situations (e.g., teaching aids, surplus property,
etc.) addressed in
http://manuals.ucdavis.edu/ppm/340/340-09.pdf
AR Separation of Duties
• No one person should have complete
control over all AR functions.
• Should be two different roles/persons:
• #1: Person collecting cash and issuing cash
receipts (cash includes checks and credit card
transactions)
• #2: Person performing the monthly ledger
review/maintaining Accounts Receivable records
AR Policies and Procedures
• University AR policies/procedures are posted at
http://manuals.ucdavis.edu/PPM/330/330-90.pdf
Let’s go through the KFS AR Process!
• Process starts with setting up your organization
options and defaults, including phone # and
account information (if not already in KFS)
• Next, you will set up information on the
goods/services for which you will be invoicing (if
not already in KFS)
• Then you will set up your Customer information
(if not already in KFS)
• Finally, start invoicing!
AR Maintenance Documents
• Maintenance Documents are accessible from the
Reference Tables tab in KFS
• The ones that departments use are highlighted here:
AR Maintenance Documents
•
Each Maintenance Document
starts with a Lookup screen to
ensure that what you want to
create is not already in the system
•
In search results, Edit link will
only appear if the organization is
one to which your KFS user ID is
assigned
•
In search results, Copy link allows
you to create a new attribute
based off of the existing
organization data
•
After confirming that the attribute
is not in KFS, click on the Create
New button in the upper right
corner
Organization Options
• Defines the SPECIFIC organization under which customers will be
invoiced.
• Data from this document is used on printed invoices and statements.
Completion of this document enters the organization into the
Organization Options table.
• EACH organization that uses KFS Accounts Receivable must have an
entry in this table.
• In other words, if you wish to set up AR billing for three separate
organization codes in your department, you will need to complete three
Organization Options documents (as well as the other AR Maintenance
documents).
Organization Options
•
The Chart and Organization assigned to your user ID in KFS default in
the Billing Chart and Organization fields, but you can override this
information if you are creating this document for a different
organization (not common).
•
The Billing Chart and Organization are for the department that is
creating the invoices; the Processing Chart and Organization are
used for the department that processes the invoices.
• Users in the Processing organization can complete the
Application and Application Adjustment documents (to be
discussed later in this training).
Organization Options
•
For most departments, the Processing Chart and Organization are
the same as the Billing Chart and Organization.
•
If each of your orgs are set up in KFS AR, you can process AR invoices
for those orgs that are part of your organization hierarchy
Organization Options
• Enter the Organizational Postal Code. For
organizations located on the Davis campus, be
sure to add the 4-digit zip code extension of
5270.
• Enter the Message Text that you want printed on
your invoices.
• Enter a departmental contact Phone Number for
AR related inquiries
Organization Options:
Routing
• If Organization Options are being set up for the
first time, the Document will route for approval
to the Dean’s Office for which your organization
reports
• If edits are being done to data for an organization
where an initial Organization Options document
has already been processed, there will be no
automatic routing
Organization Options
Organization Accounting Default
• The Organization Accounting Default (OADF) document is
used by organizations to establish or maintain the KFS
accounts and objects that will be used to record an
organization's AR transactions.
• The information entered on this document defaults on invoice
and payment documents.
• If necessary, it is possible to override this default information
on the Customer Invoice document
Organization Accounting Default
•
Enter the FY (Fiscal Year) and the COA and Billing
Chart and Organization
•
Enter the accounting information that will be used as
the Org Income Account Defaults, which is the credit
side of the transaction when invoices are generated.
• Most non-School of Medicine departments use
Object 0060; SOM often uses different object
codes.
Organization Accounting Default
•
Enter the accounting information that will be used as the Org Receivable
Account Default, which is the debit side of the transaction when invoices are
generated.
• This account can be a separate (balance sheet) receivable account in the department
organization (contact General Accounting to set up a new account) or the accounts
will be the same account entered in the Org Income Account Default section. Enter
Object 0299 (Accounts Receivable) in the Object field.
•
Enter the accounting information that will be used as the Org Income
Account Default, which is the credit side of the transaction when invoices are
generated. This account will record the income earned. For most
departments, the object entered in the Object field will be 0060 (Income).
• Note: If you are invoicing from a General Fund (SFGT=3,G) account, you must use a
reimbursement object in the Object field (720R) as income (0060) is not allowed in
General Fund accounts. General Funds should not be used for ongoing sales
activities.
Organization Accounting Default
•
Enter the account information that will be used as the Org Writeoff
Account Default for your organization. In most cases, the account
will be the same account entered in the Org Income Default field. In
the Object field, enter 7360 (Bad Debt Expense).
• If you want to charge bad debt to a revenue account (IN Account Type), use
object 0064 (Income Writeoff) in the Object field.
Organization Accounting Default:
Routing
• Document routes to the Fiscal Officer(s) assigned
to the account(s) cited on the document for
review and approval
Organization Accounting Default
Customer Invoice Item Code
• The Customer Invoice Item Code document is used to identify
all goods and/or services that an organization sells to an
external customer. An organization should assign specific
accounting information to each item
• Having account info assigned to each item saves data entry time on the
Customer Invoice document!
• Invoice item codes are unique to your organization.
• This accounting information is then searchable on the
Customer Invoice document.
Customer Invoice Item Code
•
The Chart and Organization assigned to your user ID defaults on the
document. You can override this information if you are processing this
document for a different organization.
•
If you change the Chart/Organization, the defaults assigned to that organization will display
•
Enter an Item Code (up to 6 characters); the item codes are unique to your
organization.
•
Enter a Description for the item code.
•
Enter a Stock Number for the item code, if you have one.
•
Enter a Unit Price for the item code. If the price will vary, you can leave this
field blank and manually enter it on the invoice document.
Customer Invoice Item Code
•
For new item codes, the Tax Indicator default is No (unchecked).
If the item is taxable, check the box.
•
•
Note: Services are generally not taxable while goods are. Please contact Tax
Accounting to determine if your product is taxable and whether it must be
reported as Unrelated Business Income Tax (UBIT).
The accounting information will default based on what was
entered on the Organization Accounting Default document and
will be the account credited for the items billed.
•
Remember: General Funds accounts (those with a sub-fund group type of “G”) may
not be used to record income.
Customer Invoice Item Code: Routing
•
Document routes to the Fiscal Officer(s) assigned to the
account(s) cited/any applicable Organization Review
hierarchies on the document for review and approval
Customer Invoice Item Code
Customer
•
Customer document is used to add or maintain
information for all persons, companies, groups, etc.
that are to be billed for items or services provided by an
organization within the university.
•
This document can also be used to maintain notes
regarding the customer.
•
This document routes to A&FS for review and final
approval
•
Customer codes are NOT unique to your organization
•
Before adding a new customer record, use the Lookup
screen to make sure Customer record is not already in
KFS!
Customer
•
Enter a customer name, and select a Customer Type by
clicking the dropdown arrow. The type of customer
drives what other fields are required.
•
Generally should enter Customer Name as First Name
followed by Middle Name (if applicable) and Last Name
Customer: Tax Information
•
Tax information is Optional (UCD PPM 320-22), and
should ONLY be entered in appropriately identified
fields
•
If an Individual, you can enter Social Security Number
(SSN), or for non-individuals, the Federal Employer
Identification Number (FEIN) field
•
NOTE: The FEIN and SSN are encrypted in KFS; once
entered, only authorized KFS users will be able to
“see” this data.
•
Check the Tax Exempt Indicator and complete the
Resale/Tax Exempt Number field, if the customer is
exempt from paying sales tax.
•
Tax information should NOT be entered in the NOTES
section of the Customer document
Customer
•
Enter an Email Address, Phone Number for
the Customer
•
If there is a different contact person from the
Customer, complete the Contact Name and
Contact Phone Number fields
•
Enter at least one address for the Customer;
if only one address is indicated, it should be
identified as Address Type of Primary
•
If editing an existing Customer record, you can add
additional addresses, but you should not create a new
Customer record if all you need to do is add a new
address for a Customer already in KFS
Customer: Routing
•
Document routes to A&FS for review and
approval
Customer
Customer
AR Transactional Documents
• AR Transactional Documents are
available on the Main Menu in KFS
• Once your departmental AR
maintenance data is in KFS, you can
invoice your customers
Customer Invoice
• Used to create the invoices sent to
external (non-campus) customers for
goods and/or services sold by the
university.
Customer Invoice: Routing
• Document routes to the Fiscal
Officers/any applicable Organization
Review hierarchies for review and
approval
Customer Invoice: Printing
• The Customer Invoice can only be printed AFTER the
required approvals have taken place
• A Generate Print File button will appear at the
bottom of the document
• Any KFS user can print the invoice
• Let’s complete a Customer Invoice document and
then we’ll show you what the printed invoice displays
Customer Invoice
Customer Invoice
Customer Invoice
Customer Invoice: Related
Documents Tab
The Related Documents section displays all of the
related activity (e.g., Credit Memos, Application,
Application Adjustments)
Customer Invoice: Printed Invoice
Invoice
Number is
KFS
Document #
Header Text
field displays
here
Message Text field
from the Organization
Options document
displays here
Organization
Invoice
Number field
displays here
Customer
Purchase Order
Number field
displays here
Customer Invoice: Printed Invoice
Customer Invoice: Post
Approval/Payment Processing
• When the Customer Invoice document is Fully Approved,
the cited Income Account is credited.
• Departments do not process customer payments.
Customer Invoice: Post
Approval/Payment Processing
• Payments are received and processed by the Cashier’s Office with the
creation of an Application document (or Application Adjustment
document to correct a previous payment issue).
• As payments are posted against the invoice, the cited Receivable
Account is debited
• If an overpayment is received, the amount that is overpaid is placed
in an Unapplied bucket for the organization to apply at a later time
(either on the Application Adjustment or Application document)
Customer Invoice: Voiding
• If a Customer Invoice is issued in error (and no
payments have been processed), you can void it by
clicking on the Void button at the bottom of the
fully approved Customer Invoice document
Customer Credit Memo
• Used to post a credit to a customer's account
• Starts with Customer Invoice Lookup to locate invoice to credit
• The Customer Credit Memo can be used as long as the
referenced Customer Invoice is fully approved and open.
• When entering a credit line on the Credit Memo:
• Only enter quantity or price; do not enter both.
• The number in the Quantity or Price field is the number to reduce
the invoice by.
Customer Credit Memo: Routing
• Document routes to the Fiscal Officers/any
applicable Organization Review hierarchies for
review and approval
Customer Credit Memo
Customer Invoice Writeoff
• A write-off is the classification of unrecovered
revenue as a bad debt, and removes the balance
from the customer's account and charges the
amount as an expense to the department.
• Write-offs are done to remove balances for which
collection efforts have not been successful
Customer Invoice Writeoff
• The referenced Customer Invoice must have an
open amount
• A note is required in the Customer Information
section to identify the business reason for the
writeoff
Customer Invoice Writeoff:
Routing
• Document routes to the Fiscal Officers/any
applicable Organization Review hierarchies for
review and approval
• If the writeoff is for $50 or more, the document
will also route to A&FS for approval
Customer Invoice Writeoff:
Writeoffs
should be
rare…
Application Adjustment
• This document can be used for correcting
payments posted to the wrong customer and
invoice.
• It can also be used to reverse a payment and
refund the customer for an overpayment at the
same time!
Application Adjustment
• The first time an adjustment is made, the user is required to enter a
Payment Application document number
• If creating an adjustment for a Payment Application where another
adjustment has already been processed, the previous Application
Adjustment document number should be entered
• System will validate that the document number entered is assigned to
the organization for which the user is assigned; the system will not
allow a user to apply payments that do not belong to their
organization
Application Adjustment
• Four actions can be performed on the document:
•
•
•
•
Move a payment to another invoice within the same organization
Refund the customer
Return to C.O. (Cashier’s Office)
Manage the unapplied payments
• The Return to C.O. option is generally used when a department has
received a payment in error from a customer and there aren’t any
open invoices within that organization for which it can be applied
• Once payment is distributed to the Cashier’s Office or Refunded to the
Customer, that $ is NO longer available for future adjustments
Application Adjustment: Routing
• Document routes to the Fiscal Officers/any
applicable Organization Review hierarchies for
review and approval
• In addition to the above routing, doc routes to
A&FS for approval when the selected action is a
refund or referred to central office
Application Adjustment
Application Adjustment
Application
• Used by Cashier’s Office to Apply Payments based on departmentissued Customer Invoice documents
• As mentioned earlier, departments do not process payments made
against Customer Invoice documents, but departments can use the
Application document to manage Unapplied payments
(overpayments)
Application
• Document is a good alternative to the Application Adjustment
document if all you want to do is deal with your organization’s
Unapplied payments.
• Save time! “Quick Apply” functionality allows you to apply multiple
unapplied payments at one time!
• NOTE: An organization can ONLY process Unapplied payments
assigned to their organization or subordinate billing organizations.
Application: Routing
• Document routes to the Fiscal Officers/any
applicable Organization Review hierarchies for
review and approval
Application
AR Reports in KFS
• AR reports in KFS can help you manage your
departmental KFS AR activity
• There are also options which allow you to print
billing statements for invoices for which the
customer has not made payment
Billing Statement Generation
Enter the desired search criteria for generating billing
statements for customers; refer to the A&FS website for
timelines on when billing statements should be sent
Billing Statement Generation (Page 1)
Billing Statement Generation (Page 2)
Customer Aging Report
• Use this report to determine when you need to send Billing
Statements to your customers
Hopefully your
Customer Aging
Report won’t have this
many invoices that are
this outstanding!
Customer Invoice
• This “report” option allows departments to print multiple
Customer Invoices at one time when entering a From and To Date
in the search criteria
• Alternative to printing out individual Customer Invoices (as
previously discussed)
Customer History Summary
Manage your Customer Billing and Payment History in one convenient location!
Customer History Detail
• Manage the timeliness of payments made by your
customers
Customer Unapplied Payment
Summary
• Use the information on this report to create any needed Application
or Application Adjustment documents
Customer Unapplied Payment Detail
• Manage the timeliness of payments made by your
customers
AR Reports in FIS Decision Support
(DS)
As an alternative to the KFS AR Reports, the FIS DS reports can be
helpful since you can include subordinate organizations in your
results
Unapplied Payments (FIS407)
• Displays information on overpayments that have not been applied
on an Application or Application Adjustment document
Customer History (FIS408)
• This report includes KFS Customer History from the time of KFS AR
go-live and any still OPEN DaFIS Invoices
• It does not include information on CLOSED DaFIS Invoices
AR Aging Report (KFS) (FIS409)
Manage the timeliness of your customers’ payments for all of your
organizations (including subordinate orgs) in one report!
Best Practices in KFS AR
• When creating codes (such as for Invoice Items,
etc.), use only alpha and numeric characters and NO
blank spaces
• Use the Organization Reference Identifier field on
the Customer Invoice Item Code and Organization
Accounting Default documents, and that
information will display on your ledger reports
(helps identify transactions more easily)
• Don’t create new addresses for Customer
unnecessarily
• Don’t write off Customer Invoice except as a last
resort
Help Resources
• Accounting website:
http://afs.ucdavis.edu.ucdavis.edu
://afs.ucdavis.edu tp://afs.ucdavis.edu
• FIS Help Desk: (530)752-3855 OR
[email protected] [email protected]
• We want to ensure your success in KFS!
Thank You for Your Time!