agrē has two methods for calculating interest:

Balance Forward

Daily

Typically, interest is calculated on a monthly basis before customer statements are sent out. If the invoice chargeable date is on or before the date that interest is calculated, interest is charged. Interest is calculated per invoice and/or interest item and is combined into a suggested amount (detailed information about the individual chargeable items is also available).

Once you apply the interest charges, customer accounts are updated, interest items are created, and postings to the associated GL accounts are made. Chargeable items are associated with customers; the items that customers are being charged interest on are listed for reference.

Interest items also have interest rates and chargeable dates. Interest item rates are determined the same way invoice interest rates are. Interest item chargeable due dates are automatically set to one day after the calculation date.

Use the Calculate Interest window to calculate interest for specific customers or for customers at selected locations. Any charges that you have already calculated are not affected.

After interest is calculated, you can print reports that display interest charges for groups of customers (i.e., grouped by location).

What you'll find:

Calculating Interest for Customers at Selected Locations

Undo Interest Charges

Calculating Interest for Selected Customers

Editing Specific Customer Interest Charges

Calculating Interest for All Customers

You can calculate interest for customers at selected locations or all locations.

To calculate interest for customers at selected locations

Navigate to Accounts Receivable > Interest Charges > Calculate Interest.
The Calculate Interest window opens.

Select All Customers.
You can also charge interest for just certain customers instead of all of them.

Balance Forward only

In the Chargeable date on or before box, optionally change the date for chargeable items that you want to search for.
This date is when outstanding charges start accruing interest.

In the Extend Grace Days up to box, optionally extend the chargeable date.
By allowing a Grace Period, you are giving your customers a few extra days to pay off their outstanding charges in full without being charged any interest.

Daily only

Choose Start Date and End Date.

(optional) Change the default number of Grace Days.
By allowing Grace Days, you are giving your customers a few extra days to pay off their outstanding charges in full without being charged any interest.

Balance Forward and Daily

Example of how Grace Days work:

Your chargeable date is September 30.

On September 30, a customer has an outstanding invoice of $40,000.

On October 2, they make a $40,000 payment on account, paying off the outstanding amount in full.

On October 7 you calculate interest as of September 30, but extend the grace days to October 3.

Because the invoice had a $0 outstanding amount on October 3, the customer would not be charged any interest on that invoice.

Same example, except the customer makes a partial payment of $25,000 on October 2 instead of paying in full.

Because the invoice still had an amount outstanding (of $15,000) on October 3, the grace days DO NOT APPLY (unless you have specified otherwise).

The customer would be charged interest on the full outstanding amount as of the chargeable date of September 30, which was $40,000.

In the Locations grid, check the Calculate? boxes for the locations you want to charge.
Locations are the customer home locations.
Postings are made to the customer's home location (any Location associated with the interest GL account is ignored).

Click Calculate.
The Calculate Interest window closes. The Suggested Interest Charges window opens and all customers being charged interest during this time period are listed, along with their charge amounts.

In the Charge? column, select the Charge? check boxes for customers that should have the specified interest charges applied to their accounts.
Any customers that are being waived for this cycle of interest should be excluded by leaving the Charge? check box clear. You can also enter a value of zero to show that interest is still charged but it has no value for this cycle.

Click Apply Charges.
The charges are applied to each customer’s account.

Undo Interest Charges

If errors were made when calculating interest and you want to remove the charges from the customer account, you can undo the interest charges without either transaction appearing on the customer statement.

Once you undo interest charges it cannot be undone, but the "undone" data can be viewed in the Audit/Admin data exports.

To undo interest charges

Navigate to Accounts Receivable > Interest Charges > Undo Interest Charges

Select the range of posting date(s) for the charges you want to undo

Select All Locations or narrow down the list of results by selecting individual location(s)

Click Find Charges

Check off the charges you want to delete

Click Delete Charges

Calculating Interest for Selected Customers

You can calculate interest for a specific customer rather than customers at selected locations.

To calculate interest for a specific customer

On the Accounts Receivable menu, click Calculate Interest.
The Calculate Interest window opens.

Select This Customer.

In the Customer box, enter the customer that you want to apply interest charges to.

Follow the remaining steps listed above for calculating interest for all customers.

Editing Specific Customer Interest Charges

When you calculate interest, the total interest charges for each customer are listed. However, you can use the Edit Interest Charges window to view and edit detailed information about each chargeable item for a specific customer.

To edit a customer’s interest charges

Calculate interest for all customers at selected locations or for a specific customer.

On the Suggested Interest Charges window, select a customer with interest charges to edit and then click Edit Details.
The Edit Interest Charges window opens and all chargeable items for the customer are listed.

In the Charge? column, select the Charge? check boxes for the specific items to charge interest on them.
The Interest column for the selected items is available for use. Any items that are being waived for this cycle of interest should be excluded by leaving the Charge? check box clear. However, you can also enter a value of zero in the Interest column to show that interest is still charged but it has no value for this cycle.

In the Interest column, change the amount of interest to charge for the selected item.
The suggested total based on the current interest rate and chargeable date for the item is entered by default.

To edit a specific chargeable item, select the item from the list and then click Edit Item.
The Modify Interest Settings window opens.

Select the Charge interest on this item check box to charge interest on the selected item. The Charge interest on this item check box is selected by default. In the Interest Rate box, change the interest rate percentage. In the Chargeable Date box, change the date the invoice starts accruing interest. One day after the invoice due date is selected by default.
- or -
Clear the Charge interest on this item check box if you do not want to charge interest on the selected item. The rest of the information on the window is hidden.

Click Save.
A message appears indicating that information on the Edit Interest Charges window will be updated.

Click OK.
The Modify Interest Settings window closes and the updated interest charge appears in the list on the Edit Interest Charges window.

Click Update.
The Edit Interest Charges window closes and the updated interest charges appear in the list on the Suggested Interest Charges window. If you made any changes to the customer’s chargeable items, the Modified? check box for the customer is selected.

Click Apply Charges.
The charges are applied to the customer’s account.