Collect! Credit and Collection Software™

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How To Post A Transaction

This document steps through the process of posting a Transaction in Collect!.

Requirements

- Setup Transaction Types
- Setup Client, Debtor, Company Details, Operators, Contact Plans
- Setup Commission Rate, Tax Rate, Reports and Letters
- Review help on Payment, Interest, Fee, Adjustment, Principal
- Review tutorials for an overview of Collect!

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Overview

A Transaction is any financial interaction that you need to enter in your accounts regarding payments and charges related to a Debtor. The amounts entered are used for many calculations including, Debtor Balance Owing, Month End totals for Invoices and Operator Commissions.

There are many types of transactions that you handle in the course of your business operations, including many types of payments, legal fees, interest charges, adjustments. Each of these must be entered into the system as information attached to a particular Debtor.

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Positive Or Negative Amount?

When posting a Transaction, a POSITIVE amount DECREASES the Debtor's Owing while a NEGATIVE amount INCREASES the Debtor's Owing.

After posting a Transaction, check the figures displaying in the Debtor form. Are they the opposite of what you expected? Try changing the sign of the amount you entered!

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Post A Transaction

To enter the details of these different types of financial transactions we use the Transaction form.

Useful Note If you have not setup your transaction types, please do that before you begin to post transactions.

1. Pull down the Browse menu and choose All Debtors. The list of all debtors will display.

2. Start typing the Debtor's name and the list will scroll to the closest match. Click on the Debtor of your choice and the Debtor form will open displaying this Debtor's record.

3. Select the Transactions tab in the Debtor form. A list of this Debtor's transactions will be displayed.

4. Press F3 for a new Transaction form or click the New button. A new Transaction form will be displayed for the Debtor. Notice that the Debtor's name is entered automatically.

5. Press F2 to choose a Transaction Type. Certain fields on the Transaction form will be visible or invisible depending on settings for the Transaction Type you choose.

Useful Note Financial transaction accounts need to be set according to your specifications. Settings on the Transaction form designate how information is reported and calculated. This set up is very important and is directly related to how you use fee structures, how you want to report information and deal with your client monthly statements. You can assign the Transaction to a specific operator and schedule follow up every time you post a particular transaction.

6. Fill in additional fields as needed. Press F1 for Help on the fields in the Transaction form.

7. Press Enter when your cursor is flashing on the OK button to save the charges to the account. The Debtor and Client totals will be automatically recalculated.

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Posting Debits And Fees

Debits or fees charged to the Debtor are posted as a negative amount. Negative amounts are shown in parentheses. i.e. ($7.52) means (- $7.52)

Fees to clients are posted by leaving the To Us and Direct blank and posting the fee in the Commission field.

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How To Post A Debtor Payment

When a debtor makes a payment to your agency or to your client, we post a Payment transaction to the debtor's account. There are several ways to do this. The most direct way is from the Debtor form. The steps are covered in this document. We will post a check payment, as an example.

The steps are:

  1. Open the Debtor form where you want to post the payment.

  2. Create a Payment transaction and enter the details.

  3. Examine the Debtor to make sure the new financials are correct.

The rest of this document walks you through these steps.

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Open The Debtor Form

1. Start Collect! and sign in as you would normally. Select Browse from the top menu bar and then select All Debtors from the drop-down choices. The list of all debtors will display.

2. Begin typing the name of the debtor you wish to post the payment to. As you type, Collect! will take you through the list and stop at the closest match.

3. Click on the debtor, or if the debtor is highlighted, just press Enter or F5 to open the Debtor form. The debtor you selected should be displayed.

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Create A Payment Transaction

1. Select the TRANSACTIONS tab to post the payment. If there are no transactions for this debtor, you will be prompted to enter a new one. Select the YES button to create a new transaction.

Useful Note If the TRANSACTIONS tab is lit up, this quickly informs you that there are existing transactions posted to this debtor. When you select the TRANSACTIONS tab, you will see a list of all transactions posted to this debtor. Press F3. You should now have an empty Transaction form on your screen.

2. Press F2 to display the Transaction Type list.

3. Select Type 101, Payment by Check. Once the Type 101 is selected, a lot of information is entered automatically.

4. Fill in the payment amount in the field labeled To Us if the payment was made to the agency, or in the field

labeled Direct if the payment went to directly to the client. The payment is entered as a POSITIVE amount. This reduces the debtor's Owing. Press F8 or the OK button to save the transaction. You will be returned to the Transaction list showing you the newly posted transaction.

5. Select OK to return to the Debtor form.

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Examine The Debtor

Inspect the money fields on the Debtor form to make sure the results are correct.

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How To Post A Compound Interest Adjustment

This section discusses posting a transaction to adjust the interest amount on a Debtor account. It applies to Compound Interest calculations.

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Requirements

- Setup Transaction Types
- Experience entering Transactions
- Original Principal was posted as a Transaction Type 196

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Overview

When performing Compound Interest calculations on Debtor accounts, you may find that the numbers do not match amounts that you want to post for a particular account. It is possible to post a Transaction that adjusts the Interest amount. The new amount will be used for all future calculations on the account.

Useful Note This adjustment routine applies to Compound Interest calculations. It only works when you have posted a Transaction for the Debtor's Original Principal as Transaction Type 196.

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Transaction Type 401

Collect! uses Transaction Type 401 Interest Adjustment to handle adjustments that are made to automatic interest calculations. Collect! performs all necessary steps behind the scenes to correct the compounding amounts to reflect to new Interest amount.

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Post A Transaction To Adjust Interest

1. From the Debtor form, select the TRANSACTIONS tab.

2. Choose New or press F3 when the list of Transactions for this Debtor is displayed.

3. Choose Transaction Type 401 for this new Transaction. Information is filled in automatically. Make sure you have the correct Debtor name.

4. Using the BACK [ << ] record navigation button, scroll through the Debtor transactions until you reach Transaction Type 196. Note the Payment and Posted Dates for this Transaction which posted the Original Principal.

Useful Note Whenever you intend to use Compound Interest methods, the Original Principal must be posted as a Transaction Type 196. Your Adjustment Transaction MUST have the same Posted and Payment dates.

5. Using the FORWARD [ >> ] record navigation button, scroll forward to your new Transaction 401 and enter the SAME date in the Posted and Payment Date fields for your Interest Adjustment Transaction that you found on the Transaction 196 for the Original Principal.

6. Enter the amount that you want to add or subtract from the Interest either in the To Us or the Direct field, depending on your own business procedures. Be sure to enter a negative (-) amount to lower the interest amount.

Useful Note Negative amounts are displayed in parentheses.

7. Click OK to complete the Transaction.

Collect! will automatically recalculate compounding figures to synchronize with this new amount.

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How To Post Debtor NSF Fees

This section explains how to process a check payment that has been returned to you as NSF, and how to charge an NSF fee to the account.

Let's assume that an operator posts a check payment to a debtor account. A few days later, the check is returned to you NSF. You process the check, including your NSF fee. Later on, you receive another payment from the debtor that covers both the NSF check and your NSF fee.

The steps for processing include:

  1. Posting the NSF check as an identical transaction but with a NEGATIVE amount.
  2. Adding an NSF fee to the debtor.
  3. Settling your accounts when a good payment is received.

To perform these steps:

* You must be familiar with the financial aspects of Collect! Posting transactions, setting up transaction types, and understanding statements and invoices in Collect! are all aspects of handling NSF payments.

* You need the proper transaction types in your system.

Three transaction types are used in the following example:

101 - Payment by Check
301 - NSF Charge due Agency
106 - Payment of Agency NSF Fee

* The original transaction for the check payment has to be entered in your system. If it has not been entered yet, then post the payment as outlined in How To Post A Debtor Payment.

The rest of this document walks you the processing steps.

Useful Note The step by step instructions may follow a different method of posting transactions than you normally use. Try working through these steps, as this is the basic method. Once this theory is understood, you can apply it to your own method of posting transactions.

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Posting The NSF Check

Let's assume that a week has passed and the bank has returned a check to you NSF. You must reverse the original Payment transaction and also create a new transaction to add your NSF fee to the debtor's Owing.

A check payment entered in Collect! can be reversed by posting a reversal payment transaction. This is a payment transaction with the EXACT same dollar value, identical to the original amount posted as payment for the debtor. What makes it a reversal is that this time, the amount of the payment is entered as a NEGATIVE amount.

Useful Note For your accounting and paper trail, it is best to use for the reversal NSF transaction, the exact same Transaction Type

as the initial payment, as well as the exact dollar value but as a NEGATIVE amount.

We will go to the Debtor and reverse the original payment. We will use the exact same Transaction Type and information, entering the same dollar value, but making it NEGATIVE. This reverses the payment.

That is, a Payment transaction is entered exactly the way it was first posted, EXCEPT, entering the amount in the TO US or DIRECT field as a NEGATIVE amount.

Useful Note If the initial payment was posted as TO US then the NSF transaction must be posted as TO US. If the initial payment was posted as DIRECT, then the NSF transaction must be posted as DIRECT.

1. Start Collect! and sign in as you would normally. Select Browse from the top menu bar and then select All Debtors from the drop-down choices. The list of all debtors will display.

2. Begin typing the name of the debtor you wish to post the payment to. As you type, Collect! will take you through the list and

stop at the closest match.

3. Click on the debtor, or if the debtor is highlighted, just press Enter or F5 to open the Debtor form. The debtor you selected

should be displayed.

4. Select the TRANSACTIONS tab to display the list of transactions for this debtor. Press F3 to enter a new transaction.

5. Enter 101 in the Type field. Or, press F2 to view the list of transaction types and select Code 101 from the

list. Alternatively, you can setup a Transaction Type, such as 105, to post the NSF transaction. This can allow you to run a Contact Plan when the transaction is created that will post the NSF Fee automatically, setup a letter contact, and more.

6. Enter the amount of the original check payment, in the TO US or DIRECT field, but make it NEGATIVE.

7. Enter the POSTED Date as today's date or the date the amount was reversed from your bank account.

8. Enter the PAYMENT Date to match the Payment Date of the transaction being REVERSED. This links the NSF transaction to the original transaction so the payment breakdown is properly reversed.

Useful Note If you have multiple reversals on the same day for the same debtor, go to each of the Original Transactions and put numbers into the NSF Tag field and put the corresponding number into the reversal's NSF Tag field. This is a secondary link for multiple transactions.

9. Press F8 or OK to save the transaction and return to the Transaction list. Here, you should see the reverse entry.

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Adding An NSF Fee

To post NSF fees to a debtor, you must use a Fee Transaction Type. We will use the NSF Charge Due Agency Transaction Type that is in the Demonstration database. It is Type 301. By default, this adds a $25.00 NSF Fee to the debtor.

1 Select F3, or select the NEW button, to open a new Transaction form.

2. Enter 301 in the Type field. Or, press F2 to view the list of transaction types and select Code 301 from the list. Because this Transaction Type was set up previously, Collect! will fill in the following data automatically.

  • $25.00 NSF fee has been filled in as a NEGATIVE amount in the To Agency field.
  • Omit From Daily Cash Report is switched ON.
  • Omit From Client Statement is switched ON.


3. Press F8 to save the transaction and return to the Transaction List. The initial payment, the reversal and the NSF Fee transactions are all displayed in the Transaction list.

4. Select OK to return to the Debtor record.

5. Ensure that the money fields on the Debtor screen have all been updated correctly. If they don't appear to be correct, select the RECALC button on the lower right of the Debtor form.

6. If the totals still do not appear to be correct, select the TRANSACTIONS tab and open the posted transactions. Make sure that dates and settings are correct.

Useful Note If your NSF Fees are always the same, you can set up a transaction type for your NSF fees. You may edit the Type 301 transaction type by entering your own fee amount in the To Agency field. Make sure you enter it as NEGATIVE amount.

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Settling Your Accounts

When the debtor makes a "good" payment, you must post two entries, one for the principal amount and one to cover the payment of the NSF fee. (It is assumed that you have already posted a 301 NSF Charge Due Agency Fee transaction to the debtor's account when you processed the NSF check.)

To post the two payment entries at once, we use the Debtor Payments and Charges menu.

1. From the Main Menu, select the button labeled Daily Administration to display the Daily Administration menu.

2. Select the button labeled Payments and Charges to display the Payment and Charges menu.

3. Select the button labeled Debtor Payments and Charges to display the list of Transactions. Press F3 or the NEW button to display a new Transaction form.

4. Select the Debtor for whom you are posting the transaction.

To post a credit for the NSF Fee in the To Agency, we use a Payment type transaction -Type 106 in the Demonstration database. Collect! will fill in the Description, Credit and Commission fields automatically. This method hides the NSF fee collected by the agency from the client's statement while crediting the payment to the debtor's account.

5. When you are finished, press F3 to post another transaction. Select the Debtor's name.

To post a credit for the Principal, we use a Payment type transaction - Type 101 in the Demonstration database. In the field labeled To Agency, enter the amount of the payment that is applied to the debtor's Principal. This is entered as a POSITIVE amount and it decreases the debtor's Owing.

When you view the debtor's account, the Owing will reflect these two credits posted as payments to the account.

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How To Post Outside Agency Fees

This document deals with a posting method for handling fees from an outside agency.

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Requirements

- Setup Transactions and Transaction Types
- Setup Clients, Debtors
- Review Payment Posting

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Overview

You may need to apply fees taken by some other agency (e.g., a credit counseling agency) to the Debtor's account. These fees can be applied to the Debtor's balance. To apply such a fee please study the following example.

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Scenario

Imagine a debtor makes a $20.00 payment to a credit counseling agency and the agency takes a $3.00 fee, leaving a $17.00 payment to your agency. The Debtor's balance must still be credited with the entire $20.00, while you can only charge Commission on the $17.00. You also want to record this fact in the Transaction history of the Debtor.

To manage this scenario we will first want to create a Transaction Type for reporting purposes and then create two transactions applied to the Debtor's account, one recording the $17.00 payment, and one for the $3.00 credit to the Debtor's account.

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Creating The Transaction Type

Useful Note Follow these steps the first time only. Once you have created a Transaction Type it can be used on any new Debtor transactions. The Transaction Types are used when printing Debtor and Client Trust Account Reports.

1. Pull down the System menu and choose Financial Settings, Transaction Types. The list of all Transaction Types is displayed.

2. Press F3 to create a new Transaction Type.

3. Type 310 for the new Transaction Type Code.

4. Press ENTER to move to the Description field. Type "Third Party Fees" in the Description field.

5. Press F8 to save the Transaction Type and Close the list.

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Posting The Payment

This procedure assumes that you are posting a payment by check for the current day. The total amount the Debtor has paid is $20.00, while only $17.00 is actually paid to your agency and a $3.00 service charge is deducted at source.

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Entering The Amount Paid

1. From the Main Menu, pull down the Browse menu. Choose Active Debtors. The list of all Debtors is displayed.

2. Start typing the name of the Debtor and the list will scroll to the nearest match. Press F5 to open the Debtor form.

3. Select the TRANSACTIONS tab to open a list of transactions for this Debtor. If no transactions exist, you will be prompted to create one. Choose Yes.

4. The Transaction form will be displayed. Some information for this Debtor will already be entered.

5. Choose 101 for the Type field.

6. Press F2 in the Debtor field and choose a Debtor. If you assigned the Debtor to an operator, their ID will automatically be copied into the Operator field of the Transaction.

7. Tab to the Posted Date and choose a date.

8. Tab to the To Us field and type 17. Press enter.

If you have assigned a collector and a commission rate for the Debtor then these items will be filled in automatically.

Press ENTER until you reach the last field, and a new Transaction is automatically created for you. Now you will record the $3.00 service charge deducted at source. For this transaction you will not want any commission charged, nor will you want to send the funds to the client.

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Entering The Agency Fees

Next we will enter to fee deducted by the outside agency. You should be on a new Transaction form.

1. Type 310 in the Transaction Type field and press ENTER.

2. Press ENTER to accept the Debtor name.

If you assigned the Debtor to an operator, their ID will automatically be copied into the Operator field of the Transaction form.

3. Move to the Description field and type 'Charge' or an appropriate description.

4. Move to the Direct field. Type 3 and press ENTER to record the service charge.

5. Delete the calculated Commission from the Commission Amount field.

*** You have now completed posting this payment.***

6. Press F8 to exit.

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Ensuring The Correct Posting Date

When you post payments in Collect! be sure to attach the payment to the correct date.

Useful Note You may post payments for some date in the past. If you can't find the date you want, press F3 when you are in the Day list to create a new one, and type the correct date into the Date field.

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How To Post Legal Fees

This section assumes that you are very familiar with the use of Transactions and Transaction Types. It is a quick run through for advanced users.

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To Charge Legal Fees To The Debtor

This is a way of charging legal fees to the Debtor while not adding commission or charges to the client.

1. Create a new Transaction Type (let's say 225 to stay in the legal fees section)

- Description: Legal fee to Debtor
- Account: Fee
- Enter amount on posting
- Omit from client statement
- Omit from daily cash report
- Don't calculate commission
- Don't calculate tax

2. Create a second Transaction Type (let's say 125 to stay in payments).

- Description: Legal fees paid by Debtor
- Account: Payment
- Enter amount on posting
- Omit from client statement
- Omit from daily cash report
- Don't calculate commission
- Don't calculate tax

3. Post Debtor information in the usual manner. Then post a Transaction for the initial fee using the Transaction Type 225 that you created. Enter the amount.

Useful Note This will not appear in your statements or cash report. It will appear in other reports which include all transactions, or you may wish to create a report specifically to track legal expenses.

4. To handle payment posting, first, post the amount of the fee as the Transaction Type 125 that you created. Then, post the remainder of the payment as a new Transaction - your normal payment by check, Type 101.

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How To Post Attorney Fees

This section explains a procedure for handling your accounts when they have been turned over to an attorney for collection.

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Requirements

- Review help on transactions and transaction types
- Review help on contact plans

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Overview

Ordinarily, you may have a client setup with a commission rate. When you setup debtors for this client, the commission rate is automatically displayed in the Rate field of the debtor form. Whenever you post a new transaction for this debtor, the commission rate is displayed on the transaction form and is used to calculate the commission for the transaction you are posting,

if there is commission to be calculated.

When an account is turned over to an attorney, you may want to charge a different commission rate. You will want to keep track of the portion that the attorney keeps when a payment is made. You will want to change the status code for the debtor, delete pending contacts and perform other related tasks.

There are several steps to setting up Collect! to handle your legal accounts properly. There are also some additional settings you can create for advanced features. First, we will discuss the basics.

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Changes To The Debtor Record

When an account is turned over to an attorney, there are a few areas where you need to change your settings.

1. Commission Rate

If you charge a different commission rate when an account has been turned over to an attorney, enter this new commission rate in the Rate field of the debtor's account as soon as the account goes legal. Then, whenever a payment is posted, the new commission rate will be used to calculate commission.

2. Debtor Status Code

Change the debtor's status code to Legal.

3. Pending Contacts

Choose Contacts from the debtor form and delete all pending contacts for the debtor whose account has been turned over to an attorney.

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Posting A Payment Made To An Attorney

When the debtor makes a payment, the attorney may keep their portion and give you the rest. This is an area that needs to be recorded correctly so that the proper information is displayed on your statements and your daily cash report.

1. Posting a Payment

When the debtor makes a payment, post a transaction for the FULL AMOUNT of this payment. (Do not subtract the portion that the attorney keeps. We will handle this later.) When you post the transaction for this payment, you will notice that your legal commission rate is displayed in the transaction automatically. Collect! will calculate your total commission accurately for this transaction.

2. Client Statement

When you generate your statements for this period, the entire payment and total commission will be displayed on the statement.

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Keeping Track Of Attorney Fees

Now that you have posted the debtor's payment and handled your client statement and commission, you can handle the internal record-keeping of attorney fees.

Legal Transaction Type

First, you will need a special transaction type for the Attorney Fees that you paid out or the attorney kept. This transaction type should be numbered in the Legal series. (i.e. 200 - 299)

Useful Note Transactions posted in the 200 series are totaled by Collect! as Total Legal Costs. This is displayed in the Financial Detail form that pops up when you click into the Principal field of the debtor form. Select the Totals tab.

The following settings are switched ON when you create your Attorney Fee transaction type.

Account:

Fee

Reporting:

Write to notes
Omit from client statement

Calculations:

Don't calculate commission
Don't calculate tax

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Attorney Fee Calculation

If you intend to enter an actual dollar amount for the attorney fee, switch on Enter amount on posting when you create the transaction type for attorney fees.

If you want Collect! to calculate the dollar amount based on the attorney's commission rate, switch on Percent of principal or Percent of owing. Enter the commission percentage AS A NEGATIVE VALUE in the Commission field when you create the transaction type for attorney fees.

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Posting Attorney Fees

Next, we will enter a transaction to keep track of your attorney fees so that your internal record-keeping is accurate.

Follow these steps to accurately record your attorney fees:

1. Create a NEW transaction for the debtor who has just made a payment.

2. Choose your new Attorney Fee for the transaction type.

3. Enter the amount that is the Attorney's portion in the COMMISSION field on the transaction form AS A NEGATIVE AMOUNT.

Useful Note If you chose to enter a percentage that the attorney keeps, you will notice that Collect! automatically calculates the attorney fee based on the information you entered when you created the transaction type for Attorney Fee.

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Advanced Topics

Here are a few additional methods that you can use for working with attorney fees.

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Setup An Attorney

You can setup your attorney as a client and report all account activity for this attorney. You will probably never actually add accounts to this record. It is used for linking attorney information to reports.

1. Pull down the Browse menu and choose Clients.

2. Press F3 to create a new client. Enter the attorney's information in the appropriate fields.

3. In the Type field, choose "Attorney" from the pick list.

Useful Note If you do not see this choice in your pick list, you can add it. Please refer to How to Use Pick Lists.

4. From the debtor screen, in the Legal field, select your attorney from the Client list.

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Reporting Attorney Fees

Once you have recorded your attorney fees, you can include them in your Daily Cash Report or print a separate report.

Useful Note The code that is displayed here uses transaction type 203 for attorney fees. You can substitute your own code here. You can paste this code into the external Daily Cash Report supplied in the demonstration database.

Use this code as a new report or add it to an existing report.

@varfeeamt$ = 0.00
@varfeetot$ = 0.00
@varforward* = " "


@H
@%Forward / Attorney Report@%
@A
@!Debtor NameAttorney NameDate Attorney Fee@!

@!------------------------
------------------------ ---------- ------------------@!
@de NO TOTAL
@cl NO TOTAL where (@cl.cl = @de.leg)
@varforward = @cl.co
@cl
@de.tr NO TOTAL where (@tr.ty = 203) where (@tr.pda = ?)
@varfeeamt = @(0-tr.ca)
@varfeetot = @(varfeetot+varfeeamt)
@de.na<24> @varforward<25> @tr.pda>10> @varfeeamt>18>
@de.tr
@de

------------------------@!------------------@!
@!Total Attorney Fees: @varfeetot>18>@!

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Legal Contact Plan

You can create a contact plan to automate your procedure when a debtor's account is turned over to an attorney.

Some events in this plan might be as follows:

1. Delete all pending contacts.

2. Change the commission to your Legal rate.

3. Change the debtor's status to Legal.

4. Write to the debtor's notes.

5. Schedule a Review by an operator.

6. Perform other functions that your business requires when an account goes to an attorney.

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How To Post Court Or Legal Costs

This section covers assigning court or legal costs to a Debtor or Client.

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Requirements

- Experience using and setting up Transaction Types

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Overview

Court and other costs can be assigned to a Debtor or to a Client. This can be done by posting transactions to the Debtor's account.

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Legal Cost Transaction Types

First, it is necessary to create Transaction Types to handle your legal fees. For this, please use the 200 series in the Transaction Type categories, since types 200 to 299 are set aside for Legal Costs.

For example:

Code 205 - Serve Papers - Account Type: Fee

Code 210 - Docket Cost - Account Type: Fee

Useful Note Any legal cost that is posted as a transaction in the 200 series is automatically tallied by Collect!

When you click in the Principal field on the Debtor form, you can view the Total Legal Costs in the Financial Detail form. Select the Totals tab.

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Posting A Legal Transaction

After you have created your transaction types, you can use them to assign fees to debtors or clients.

To try this out, go to the Debtor form and select the TRANSACTIONS tab. Create a new Transaction of type 205, assuming you created a 205 transaction type.

ADD FEE TO DEBTOR

To add the fee to the Debtor, enter it as a negative (minus) amount in the 'To Us' field. This will add the amount to the Debtor's Owing.

BILL FEE TO CLIENT

To pre-bill the Client this fee and NOT add it to the Debtor, enter the cost as a positive amount in the 'Commission Amount' field. When you generate the statement, Collect! will bill the amount to the Client and not affect the Debtor's Owing.

ADVANCED BILLING TECHNIQUES

The procedures described so far are very straightforward. However, scenarios of fees, charges and billing can be complicated and

diverse. The following is an example of a slightly more complex assignment of costs. It will demonstrate the flexibility of Collect! for posting different types of transactions and payments.

Let's say that you want to charge legal fees to a Debtor. Since you have paid the costs yourself, you don't want to wait to be reimbursed. You want to bill your Client now and reimburse them when the Debtor settles the debt.

1. To add the amount to the Debtor's Owing, post a transaction of a legal type as described above. Enter the amount in the 'To Us' field as a negative (minus) amount. This will increase the total that the Debtor owes.

2. In the Client Payment form, enter a new client payment that is a negative (minus) amount, equal to the amount entered in the Debtor form.

In the Description field, enter a note to explain that this charge is "Billing for court costs for Debtor #, etc."

When the Client's statement is generated, the amount will be calculated and billed. A note will be included to explain the charge.

3. When the Debtor settles the debt, post a transaction that is a Payment type. In the Description, enter "Payment toward court costs".

4. In the Client Payment form, enter a new client payment that is a positive amount.

In the Description field, enter a note to explain that this is "Credit for court costs for Debtor #, etc."

When the Client's statement is generated, the amount will be calculated and credited. A note will be included to explain the reimbursement.

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Legal Fees Breakdown

In the Financial Detail form, Total Legal Costs amount is displayed. If this is a combination of fees that are owing to the agency and fees for which the client must be reimbursed, you can do a breakdown of Legal Fees.

Useful Note When you setup your transaction types for court costs and payments, be sure to refer to help documentation. In particular, the 'Omit from Client Statement' switch can be used to flag charges that do not involve the client.

If a breakdown of legal fees is needed:

1. When you are on the Debtor's form, select the TRANSACTIONS tab to display all transactions for this Debtor.

2. Press F6 to bring up the Edit Search Criteria form. To refer to help available for designing search criteria, press F1.

3. Do a search for all legal fee transactions that DO NOT have the 'Omit from Client Statement' switch set. This will tell you the portion of fees that were charged to the client. Descriptions that were entered when the transactions were posted can give you details. Also, the Client Payments can be checked to confirm your calculations.

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How To Post Client Fees And Charges

You may charge fees to your client without affecting the debtor. The method you use to post fees and charges to a client depends on whether or not you want a paper trail and how you want this set up.

Method 1 - Transaction

You can create a specific Transaction Type for these charges. Please see How To Setup Transaction Types for details. Your transaction type can be set up as a Fee, with Omit from daily cash report, Don't calculate commission, and Don't calculate tax all switched ON.

When you want to charge a fee to the client using this method, open the Debtor form for the debtor involved and post this transaction. However, we do not put anything in the fields labeled To Us or Direct, but we put the amount into the field labeled Commission Amount. A letter/statement can be used to reflect this Transaction Type to bill the client. When the Client pays, you post the same transaction with a negative commission amount. The description can always be changed to reflect the purpose of the transaction.

1. Open the debtor the charge relates to.

2. Select the TRANSACTIONS tab.

3. Post a new transaction with the following settings:

- Account: FEE is dotted
- Omit from daily cash report is checked
- Don't calculate commission is checked
- Don't calculate tax is checked


4. Make sure the 'Omit from Client Statement' switch is OFF.

5. Enter the amount of the fee in the Commission Amount field.

Useful Note You can create a Transaction Type that shows only the Commission field to make it easier for the user to know where to put the amount.

Useful Note Posting an amount, either a charge or a credit, as a Commission, is a way of handling financial transactions with a Client, without affecting the debtor's balance.

Example:

You might charge a fee to a client for court costs. Later on, you may win a settlement, get an amount from the debtor and need to reimburse the client.

You would post two transactions that have no To Us or Direct amounts, just a Commission amount. One transaction would be a positive amount, when the client is charged. The other would be a negative amount, when the client is reimbursed.

Method 2 - Client Payment

You can also apply fees or charges to a client using the Payment section of the Client. You would post a negative amount for the amount of the fee. Then post a payment with a positive amount when the Client pays. The Description may be used to detail the reason for the charge and the debtor the fee relates to. This can also be used in a statement or letter to the Client.

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To Test That The Fee Appears On Statements

1. Choose the Month End menu and Generate Statements.

2. Browse the statements generated, looking for the client to whom the fee was charged.

3. Open the statement and then open the Line Items to see whether the charge you posted appears correctly.

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Summary

We have examined posting transactions in Collect!.

Before you begin to post transactions in your Masterdb database, your accounts and transactions must be set according to your specifications. Proper setup at the beginning will give you satisfying results in your reports and calculations.

This is a personal process. It depends on how you use fee structures, how you want to report information, how you deal with your client monthly statements and your agreements with your clients.

Set up transaction types, reports and contact plans before you begin to enter transactions. That way, you will know what you have available to you to automate your routines and print reports.

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