Transfer Outstanding Invoices

You use this option to move outstanding invoice values from one account to a temporary holding account.The two main uses of this are:

Retentions. In some businesses — for example the construction industry — a small percentage of the value of invoices are not paid by the client until (say) six months from completion of the job. Where a number of jobs are in progress for a particular client, the retentions can distort the aged debtor reports, and perhaps lead you to chase for payment which is not in fact due. One way to tackle this is to transfer retained balances to a "retentions” account, for later chasing when the time is up — you could this in conjunction with the Change Payment Due Dates option above.

Bad debts. Where a customer has defaulted on payment, or gone into liquidation, a bad debt is the result. Although you can use the bad debt ledger procedures described above, there is an intervening period where you may not know the final position because there may still be a future payment or a dividend from the liquidator. It may suit you to transfer such invoices to a bad debt holding account in order that you can see a truer ageing picture on the rest of your ledger.

Selecting this option asks you to confirm the date of the ‘allocation’ action, today’s date is prompted but can be overwritten. The date entered must be within the current period. You are then asked for the account code, following which any outstanding invoices are listed.

You can select an invoice to transfer by moving the highlight bar up and down the invoice list and, when the required invoice is highlighted, selecting Y to transfer the invoice.

After selecting the invoice to transfer, you are asked to confirm the transfer amount – prompted with the outstanding balance – after which the transfer details are displayed in a separate window.

Transfer Total – the total amount confirmed for transfer.

Tax code - Taken from the original invoice.

Net amount - Calculated backwards from the amount and tax code. The tax amount displays alongside the tax code.

To account code - In Datafile Diamond and Premier only you can specify a default value for the account code. Otherwise enter an account code (you can use the <F4–Select> key in the usual way).

New due date - Enter here the date that this invoice should now become due for payment.The original due date (not the original invoice date) is shown to help in planning the new due date.

Reference - Prompted from the original invoice, but you can change it if you want to give the transferred invoice a different reference.

Description - The original invoice description is shown, with a prefix of "TFR:” (for transfer). You can change this description if you wish.

Once you have completed the transaction details you are asked to confirm the transfer. Reply ‘No’ to abandon the transfer, or ‘Yes’ to continue.

An invoice adjustment transaction is posted and allocated to the selected transaction in the current account, and an invoice transaction with the original details as amended above is posted to the transfer account. Once the transfer is complete you are returned to the account code prompt.