The Customer Bill of Exchange Payment process is used for handling bills of exchange received from customers. The process starts in the Customer Bills of Exchange window with entry of the Bill and matching it with the invoices it covers. Invoices in other companies can also be matched, and deduction used, as long as the customer is defined in the other companies. When the Bill is saved, a payment is created and also a voucher in the hold table in IFS Accounting Rules. The matched invoices are paid and the customer claim from the invoices (IP2) is removed, but a new customer claim appears (PP27) which is represented by the entered open Bill of Exchange. If the Bill is not completely matched with invoices, the remaining, unmatched part is stored as a payment on account (PP8) or as a payment in advance (PP36), which can later be matched with payments. If the Bill does not cover the entire invoice amount, you can create a difference item invoice for the remaining amount. After entry, the matched invoices and the payment will be assigned matching IDs and matching dates, the status of the Bill will be Created, and the open Bill will be found in the AR ledger with its series ID and number.
Alternatively, it is also possible to endorse a customer bill of exchange that has been received, to settle the debts to the company's suppliers. The status of the bill will be changed to Endorsed. A liability will be created on the company (PP64) until the company's customer (i.e. the issuer of the bill of exchange) pays the company's supplier. (i.e. the supplier to whom the bill was endorsed) When the bill is endorsed, (matched with the supplier invoices) all matched invoices will be marked as paid.
The next step is to select Customer Bills to send to a payment institute for cashing and this is done in Customer BoE Transfer Proposals window. This starts with generating a customer Bill of Exchange transfer proposal based on for example due date interval, currency, cash account and payment method. You also specify a cash date and whether the selected Bills should be cashed on due date or before due date. Then you create a Bill of Exchange Transfer file including information about the selected Bills and send this to the payment institute. When the transfer file is created, the included Bills are all settled (closed), i.e a payment and voucher are created. The customer claim (PP27) is removed and posted either to the cash account (PP1) or to a transit (interim cash) account (PP24) depending on the setup for each Customer Bill of Exchange Series. The transit account is a temporary account used pending cashing by the bank. The status of the Bill is now either OnDueDate or BeforeDueDate (if interim cash account is used) or Settled (if cash account used).
If an interim cash account was used when sending the Bills to the payment institute, the last step is to confirm that the Bills were cashed which is done in Mixed Payment, posting from the transit account (PP24) to the cash account (PP1). After this, the status of the Bill is Settled.
There is also an alternative way to handle the process sending for cashing before due date. This setup for each Customer Bill of Exchange series, by selecting the Separate flow when cashing before due date check box. In this case, the Bill is still open after having been sent to the payment institute. Instead, posting is made to a Customer Bill of Exchange Cashed in Advance account (PP25) and either to the cash account (PP1) or to an interim cash account (PP24) depending on the setup for each Customer Bill of Exchange Series. The status of the Bill is now BeforeDueDate. When the bill is cashed before the due date, a discounting fee can be applied to the bill of exchange, which is the fee charged by the payment institute for cashing the bill before the due date. The discounting fee can be specified only for one bill of exchange at a time. (i.e. if a payment document proposal includes several customer bills of exchange, it will not be possible to enter discount fee information for the bills.) The discount fee specified for a bill (if any) will be posted to the Customer BoE Early Settlement, Discounted Fee account (PP65). The discounting fee will be deducted from the posting types PP1 (Cash Account) and PP24 (Interim Cash Account). The last step in this case is one of two possibilities. If an interim cash account was used, confirmation that the Bills were cashed is done in Mixed Payment, posting from the transit account (PP24) to the cash account (PP1) and also between the Customer Bill of Exchange Cashed in Advance account (PP25) and Open Customer Bill of Exchange account (PP27). Otherwise, the confirmation is made with the Settle function in Customer Bills of Exchange, posting between the Customer Bill of Exchange Cashed in Advance account (PP25) and Open Customer BoE account (PP27). In both cases, the status of the Bill is, after confirmation, Settled.
There is an optional way to start the whole Customer Bill of Exchange Payment process and that is to create a Bill and send to the customer for approval. This starts with generating a payment document proposal, including unpaid customer invoices, based on for example invoice date interval, customer interval and payment methods. After having acknowledged the proposal, Bills can be printed and these can then be sent to the customers for approval. When such a Bill returns approved by the customer, the Bill information, including matched invoices, can be copied from the payment document proposal into a real customer Bill. This is done in Customer Bills of Exchange by referring to a Payment Document ID. process and that is to create a Bill and send to the customer for approval. This starts with generating a payment document proposal, including unpaid customer invoices, based on for example invoice date interval, customer interval and payment methods. After having acknowledged the proposal, Bills can be printed and these can then be sent to the customers for approval. When such a Bill returns approved by the customer, the Bill information, including matched invoices, can be copied from the payment document proposal into a real customer Bill. This is done in Customer Bills of Exchange by referring to a Payment Document ID. process and that is to create a Bill and send to the customer for approval. This starts with generating a payment document proposal, including unpaid customer invoices, based on for example invoice date interval, customer interval and payment methods. After having acknowledged the proposal, Bills can be printed and these can then be sent to the customers for approval. When such a Bill returns approved by the customer, the Bill information, including matched invoices, can be copied from the payment document proposal into a real customer Bill. This is done in the Customer Bills of Exchange window by referring to a Payment Document ID.
For printing of Bills from a payment document proposal you have to specify some basic data, like how many invoice lines that can be printed on each Bill page.
Customer Bills can be specified in the accounting currency, or if the accounting currency is an EMU currency also in EUR.
When matching a Bill with invoices, you can mix EMU currencies. A Bill in EUR can for example cover invoices in DEM or FRF.
Before you start entering information check that Basic Data Required (BDR) has been set up as per instructions in Define Financials Basics, the Set up Basic Data Accounts Payable process.