Factoring consists in transferring all or part of the customer accounts receivable or debts to a third party financial body: the factoring company or factor. The factoring company collects the accounts receivable that have been transferred to it and the related non-payment risk. In exchange, the factoring company settles the amount of the invoices, minus commissions and late charges.

It is important to note that saving commissions and late charges is not automated. When entering the payment of the factoring company, you need to create at least two lines: one line for the payment of the receipt as a whole, and another line for commissions and late charges (under an appropriate payment attribute, see Payment attributes.

The factoring function as it is managed in Sage X3 is sub-divided into several phases:

  • Identification of the factoring companies (see Factoring companies).
  • The assignment of a factor to the customer invoices to be processed (see Entry of factoring companies)
  • Creating receipts. It is used to create a list number for a set of invoices and credit memos transferred to a factoring company, and to print these lists of transferred invoices, accompanied with a transfer letter of accounts receivable. (see Receipt generation.)
  • The posting of these receipts (see Posting of Receipts).
  • Notification of the payment (current function).
  • You need to save a payment receipt in the same amount as on the factoring company's receipt. This phase follows the normal payment flow (see Payment entry).

The factoring company is not considered a BP. The payment must be entered on the account of the factoring company, without mentioning the BP.

Prerequisites

SEEREFERTTO Refer to documentation Implementation

Screen management

Entry screen

Payment notification

Use this function to create an accounting document by paid due date, to match the receipt and the payment, and to match the invoice with the payment.

The grid displays the due dates for the selected receipt or the invoices that have been entered directly in the grid. Each due date generates an accounting document. The entry line credits the customer account. The counterpart is for the collective account and the customer code (for the FCTN1 automatic document) or on the transfer account (automatic journal FCTN2) depending on the factor setup. This function matches the customer account and the transfer account for each invoice.

Selection criteria

You must enter a Factor code to load a receipt and related open items in the grid. You can enter date ranges for open items to filter results. A message displays if all open items are paid.

Generate the notification

Click Loading to display all the invoices matching the selection criteria. In entry mode, you can only access the column for "Paid amount,"  which is the amount paid by the customer to the factor.

Click OK to record the payment and create the journal that reflects the reduction in customer debt to the settled amount.

Select the check box for Log file to create a log file.

Credit memos

The factoring company does not return any notification for credit memos allocated to invoices. The amount of the payment notification for an invoice with a credit memo is equal to the value Invoice amount - Credit memo amount.

Criteria

Factor (field FACTOR)

Enter the Factor code to load open items related to this factor.
From open item (field DUDDATDEB)

Enter a date range to load open items for a specific time period.

To open item (field DUDDATFIN)
Factoring type (field FCTTYP)

This field displays the factoring type for the selected factor and cannot be modified. 

Grid Open items

Receipt (field FCTVCR)

This field displays receipts for open items related to the selected factor.
Currency (field CUR)
Currency (field REGCUR)

This field displays the Payment currency in either the invoice or the bank currency.
Paid amount (field REGAMT)

This field displays the paid amount on the invoice and cannot exceed the total invoice amount. It can be a partial payment.
Unpaid (field UNPAID)

This field shows the unpaid amount of the invoice. It can be a partial amount and the Paid amount plus Unpaid cannot be more than the invoice amount. 
Reserve amount (field AMTRES)

This field displays the percentage of the invoice that the factor withholds to anticipate a possible nonpayment. You cannot edit this field.

The actual percentage is based on your contract with the factor and cannot exceed the total invoice amount including tax. If the invoice is unpaid, the factor does not return the reserve percent.

Generation

Notification date (field ACCDAT)

The Notification date defaults to the current date and it used for the accounting document and the log file. You can edit this field.
Invoice Inquiry

Specific Buttons

Loading

Use this button to load open items matching the entered criteria: factor, receipt number, due dates.

Error messages

The only error messages are the generic ones.

Tables used

SEEREFERTTO Refer to documentation Implementation