Scenario: Automatic settlement and prioritization
Important
This content is archived and is not being updated. For the latest documentation, see Microsoft Dynamics 365 product documentation. For the latest release plans, see Dynamics 365 and Microsoft Power Platform release plans.
Applies To: Microsoft Dynamics AX 2012 R3, Microsoft Dynamics AX 2012 R2, Microsoft Dynamics AX 2012 Feature Pack, Microsoft Dynamics AX 2012
You have two options when you settle payments with invoices and other transactions. You can manually select the transactions to settle, or Microsoft Dynamics AX can select the transactions automatically by using the automatic settlement functionality. This topic describes how transactions are settled if you select the Automatic settlement check box in the Accounts receivable parameters form. You can also customize how automatic settlements are processed by using the Prioritize settlement check box, the Use priority for automatic settlements check box, and the Manage priority link. For information about these options, see Accounts receivable parameters (form).
The way that transactions are automatically settled can differ, depending on the method that you use for automatic settlement. The following methods are available:
User-defined settlement priority
Default automatic settlement
The following sections describe how transactions are settled for each method.
Example transactions
The examples of settlements later in this topic are based on the following transactions. All transactions are for customer 2050.
Transaction |
Date |
Amount |
Cash discount terms |
Cash discount date |
Comments |
|---|---|---|---|---|---|
Invoice 1 |
August 15 |
100.00 |
2%14, Net 30 |
August 29 |
|
Invoice 2 |
September 1 |
250.00 |
2%14, Net 30 |
September 15 |
|
Invoice 3 |
October 15 |
500.00 |
2% 14/Net 30 |
October 29 |
|
Interest note |
October 15 |
7.00 |
This interest note is for invoice 1 and invoice 2. The amount is calculated as 2 percent interest on amounts that are 30 or more days past due. For example, .02 * (100.00 + 250.00) = 7.00. |
User-defined settlement priority
If you select the Use priority for automatic settlements check box in the Accounts receivable parameters form, the settlement priority that you define in the Settlement priority form is used when transactions are selected for automatic settlement. For more information, see Settlement priority (form). For this example, the following attributes are selected:
Transaction type
Payment fees
Collection letters
Interest notes
Invoices
Transaction date, Ascending
Voucher
If you post a payment for 700.00 on October 25, the following transactions are automatically selected for settlement.
Voucher |
Date |
Invoice |
Amount in transaction currency |
Amount to settle |
Balance |
Currency |
|---|---|---|---|---|---|---|
Interest note |
10/15/2015 |
7.00 |
7.00 |
0.00 |
USD |
|
Invoice 1 |
8/15/2015 |
10001 |
100.00 |
100.00 |
0.00 |
USD |
Invoice 2 |
9/1/2015 |
10002 |
250.00 |
250.00 |
0.00 |
USD |
Invoice 3 |
10/15/2015 |
500.00 |
343.00 |
157.00 |
USD |
Default automatic settlement
If there is no user-defined settlement priority, transactions are automatically selected for settlement based on the due date. The transactions that are settled must have the same currency as the transaction that they are settled with. If you post a payment for 700.00 on October 25, the following transactions are selected for settlement.
Voucher |
Date |
Invoice |
Amount in transaction currency |
Amount to settle |
Balance |
Currency |
|---|---|---|---|---|---|---|
Invoice 1 |
8/15/2015 |
10001 |
100.00 |
100.00 |
0.00 |
USD |
Invoice 2 |
9/1/2015 |
10002 |
250.00 |
250.00 |
0.00 |
USD |
Invoice 3 |
10/15/2015 |
500.00 |
350.00 |
150.00 |
USD |
|
Interest note |
10/15/2015 |
7.00 |
0.00 |
0.00 |
USD |
See also
Accounts receivable parameters (form)
About parameters for settlements in Accounts receivable
Scenario: Settle a customer payment with an invoice
Scenario: Cash discount handling for overpayments
Scenario: Settle a partial customer payment that has multiple discount periods
Scenario: Use one customer payment to settle multiple invoices that span multiple discount periods
Scenario: Settle a partial customer payment that has discounts on credit notes