Below is an explanation of the different workflows an agency must follow for direct bill deposits depending on whether they are set on an accrual or cash basis.
Follow the steps below when you receive money back from the company for direct bill.
If you receive a commission check and you are on an accrual basis, enter a deposit for the commission and offset (credit) Direct Bill Receivables. At Month-End, a system generated journal entry (MJE3) occurs based on the Direct Bill transactions that have been entered throughout the month. This MJE typically debits Direct Bill Receivables and credits Direct Bill Commission Income. When the Direct Bill transaction was invoiced, it debited Direct Bill Receivables via a Month-End journal entry. This balance will come out of Direct Bill Receivables when the deposit is entered and Receivables is credited. For more information on Month-End J/Es, refer to the Month-End Generated Journal Entries document - MJE3 section.
To balance the Direct Bill Receivables account, use the Direct Bill Report. Set the Date Selection criteria to Items Due Before a Month. The month you choose depends on what you are balancing. If you are posting a month and want to balance to the amount in the account as of the end of the month to be posted, select the month that is after the month that is being posted. If balancing the current month, select the month that is after the current month. The other criteria that should be set is Paid by company. Set this to Unpaid by Co - Include Partials. This report is as of this point in time. If you reconcile direct bill, the amounts on this report will change. This cannot be recreated. It is recommended that this be kept along with the Aged Receivables report at each Month-End.
There are no Direct Bill Receivables on a cash basis, and TAM will not do any Month-End system-generated journal entries. Therefore, Direct Bill Commission Income will not be recorded until the commission check is deposited into TAM. If you receive a commission check and you are on a cash basis, enter a deposit for the commission and offset (credit) Direct Bill Income.
On direct bill, the only monies that should be exchanged between the agency and the company are for commission. If there is a Direct Bill negative endorsement, negative audit, or a cancellation, the company does not pay the agency for these. The company will reimburse the client in full and the commission statement to the agency is reduced by the amount of commission on these items.
If, for some reason, the company sends the client check to the agency instead of the client and it is for the gross amount, follow the steps below.
When the return premium check sent to the agency is for only the net amount, follow the steps below:
Last Revised: February 19, 2008 02:24 PMSWE3894