Process collection letters

This article shows how to create, print, and post collection letters. This task uses the USMF demo company.

Set up a collection letter sequence on the posting profile

1. Go to Credit and collections > Setup > Customer posting profiles.
2. Click Edit.
3. Select a collection letter sequence from the drop-down list. If you do not want to generate collection letters for transactions using this posting profile, leave the field blank.
4. Expand the Table restrictions tab to change the way that collection letters are processed. If this field is set to Yes, then collection letters will be created for this posting profile.

Create collection letters

1. Go to Credit and collections > Collection letter > Create collection letters.

2. Select the transaction types for which you will collect letters. All of the open transactions for these types will be included in the calculation.

3. In the Collection letter field, select an option.

4. In the Collection letter date field, enter the date of the collection letter.

5. Select a posting profile if you changed Use posting profile from to Select. There are two posting profile options:

   • Account – Use the posting profile that is assigned to the customer account for each interest note.
   • Select – Use the posting profile that you select in the Posting profile field.

6. Expand the Records to include section.

7. Select Filter.

8. In the Criteria field, enter a Customer ID. For example, enter 'US-001'.

9. Select OK.

10. Select OK.

Print collection letters

1. Go to Credit and collections > Collection letter > Review and process collection letters.

2. In the Status field, select Created.

3. In the Printed field, select Not printed.

4. Select Print.

5. Select Collection letter note.

6. In the Parameters section, enter the cutoff date for postings.

7. Expand the Records to include section and enter the details of the Collection letter note.

8. Select OK to print the collection letter.

9. Post the collection letter.

   1. Select Post.
   2. Enter the posting date for the collection letter.
   3. Expand the Records to include section.
   4. Select OK.
   5. In the Status field, select Posted.
   6. In the Printed field, select an option.

Control collection letters at the customer level

If collection letters are set up at the transaction level, multiple letters might be generated for a customer, based on transaction aging. If transactions appear in different letter sequences, separate collection letters will be generated for each group of overdue transactions for the customer. Therefore, an individual customer might receive, for example, one collection letter for transactions that are 60 days overdue and another collection letter for transactions that are 90 days overdue.

Each collection letter is also associated with a collection letter code. The collection letter code is associated with individual transactions and is used to determine when the next collection letter should be generated for each transaction. For example, if a transaction is more than 30 days overdue, the collection letter code determines that the next collection letter will be sent when the transaction becomes 60 days overdue, if it isn't paid before then.

Collection letters can also be set up at the customer level. In this case, the collection letter code for each transaction is tracked, but collection letter processing will be based on a single collection letter level that is stored for the customer. The single collection letter will contain all the transactions that are overdue for the customer. Because the grace days are now tracked at the customer level, the next collection letter won't be sent until the number of grace days has passed for the next collection letter in the sequence, even though transactions became overdue after the last collection letter was sent. This option helps reduce the number of collection letters that you must send to each customer.

Set up the customer to control collection letters at the customer level

1. Go to Credit and collections > Setup > Accounts receivable parameters and select the Collections tab.
2. Change the value of Create collection letter per to Customer.
3. Go to Credit and collections > Collection letter > Review and process collection letters. Only one collection letter will be generated for a customer with all the overdue transactions.

Ignore payments and credit memos when calculating the collection letter code

If you include payments and credit memos in the transactions that will be included in the collection letters, you may have payments or credit memos that will trigger a collection letter. You can control how payments and credit memos control the collection letter code by changing the value of the Ignore payments and credit memos when calculating the collection letter code parameter.

To ignore payments and credit memos when calculating the collection letter code, do the following.

1. Go to Credit and collections > Setup > Accounts receivable parameters and click the Collections tab.
2. Select Yes in the Ignore payments and credit memos when calculating the collection letter code field.