Mastering Dunning: Efficient Overdue Payment Management

Guides & Tutorials
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Introduction

In the world of business, it’s crucial to manage overdue payments effectively. Empress has a feature called Dunning that can help you with this. This tool lets you issue persistent requests for debt payment against unpaid Sales Invoices. This guide will explain how to access, create, and manage Dunning documents in Empress, as well as explain Dunning Types and the various statuses a Dunning document can have.

Accessing Dunning Documents

To start, navigate to the Dunning list in Empress as follows:

Home > Accounting > Dunning

Prerequisites

Before creating a Dunning document, ensure you have the following:

  • Sales Invoice: A Dunning document can only be created against an overdue Sales Invoice.
  • Dunning Type: This is used to pre-fill interest, fees, and text blocks in a new Dunning document.

Creating a Dunning Document

Dunning documents are created against a list of overdue scheduled payments. There are two ways to create a Dunning document:

1. Creating a New Dunning Document

To create a new Dunning document:

  1. Go to the Dunning list and click on “Add Dunning”.
  2. Choose a Customer and click “Fetch Overdue Payments”. This will show a list of overdue Sales Invoices for the selected customer. Pick the ones you want to include in this Dunning document and click on “Get Items”.

2. Creating a Dunning Document from an Overdue Sales Invoice

To create a Dunning from an overdue Sales Invoice:

  1. Go to the Sales Invoice list and open any overdue Sales Invoice.
  2. Click on “Create > Dunning”. This will fetch all overdue payments from the invoice’s payment schedule table into a new Dunning document.

Completing the Remaining Fields

  1. Select a Dunning Type to automatically fill fields for interest, dunning fees, and text blocks with pre-set values. Alternatively, you can set these values manually.
  2. Set an income Account (for example, “Other interest and similar income”) and Cost Center for the income generated from interest and dunning fees. These will be used once a Payment Entry is created from this Dunning document.
  3. Save and submit the Dunning document before sending it to the Customer.

Understanding Dunning Types

Dunning Types store default values for dunning fee, interest rate, and text blocks to be included. For example, a Dunning Type “First Notice” will not have any fees, but Dunning Type “Second Notice” will have a dunning fee and interest charged on the outstanding amount.

Dunning Statuses

These are the statuses automatically assigned to Dunning documents:

  • Draft: Dunning document is saved but not yet submitted.
  • Unresolved: Dunning document is submitted but no payments have been received.
  • Resolved: Dunning document is resolved when the outstanding payment has been received.
  • Cancelled: A cancelled status is assigned to a cancelled Dunning document.

Managing Payments

Upon receiving a full payment, including interest and fees, open the unresolved Dunning document and click on “Create > Payment”. This will create a Payment Entry against the outstanding scheduled payments and record the interest and fees as “Payment Deductions or Loss”. The Payment Entry will automatically set the Dunning’s status to resolved.

In summary, the Dunning feature is a powerful tool for managing overdue payments in Empress. It allows you to keep track of unpaid invoices, issue persistent payment requests, manage payments, and more. For more assistance with Empress, please refer to the Empress Support Center or contact our support team.