Utility Billing Balancing the Accounts Receivable Click for next screen. Click for previous screen. You may press the Esc key at any time to exit presentation. Local Government Data Processing Corporation

Utility Billing A/R Balancing Summary This feature is designed to help insure that your Utility Billing system stays in balance, and to help keep the General Ledger receivable accounts in balance with the actual Utility Billing customer records. LGC recommends that you balance the system at least once per month, at the end of each billing or accounting month. If you are having problems balancing the system you may elect to run this process weekly or even daily until you are confident that the system will stay in balance. What are you balancing? Since a typical utility serves hundreds or thousands of customers, it is not practical to manually balance every single customer to make sure their current balance is correct. This process balances the system as a whole and by book. If these balance, the odds of each customer’s balance being correct are very high. There is also an A/R Balancing Exception Report that will list any customers that do not balance.

Utility Billing A/R Balancing What can cause the system to be out of balance? The system should never get out of balance unless there is a hardware or software failure. A hardware or software failure can cause the system to update some records for a transaction but not all of them. This can cause the balance on the customer record to be different than the total of all the monetary transactions. If this happens the customer should show on the exception report, and the LGC Support staff can assist you in correcting the customer’s transactions. How does this work? This process takes the balance for each customer from the end of the previous billing period, or last time the system was balanced, and constructs what the current balance should be based on billing, payment, penalty, adjustment, etc. transactions that have been posted since the last balancing. You will see the term "time stamp" several times throughout this document. This is simply a record of each customer’s balance at an exact date and time. Since the customer balances are constantly changing, you need a definite point in time from which to balance. This time stamping gives you that point. For example, if you know everything was in balance at the end of January, you run the time stamp option to record each customer’s balance at that exact date and time. This allows you to balance at the end of February by using the end of January’s balances, which you know were correct, and balance forward. When the system is in balance at the end of each billing period, a new time stamp is created for the next period.

Utility Billing A/R Balancing Getting Started This step needs to be run only once to initialize the automatic balancing system files and get a starting point. This is the only step that should be run at the end of the initial balancing period! You must pick a point in time to start the A/R balancing process. This process is based on the concept of balancing the system since the last time it was in balance, so you must pick a point to time stamp the A/R balances and start balancing forward. An ideal time to start this process is at the end of a fiscal year. At this point you will probably run a detailed Accounts Receivable report for the auditors, so it is a convenient point to time stamp the balances and start the balancing process. However, you can pick the end of any billing or accounting period when you are sure the system is in balance to start the process.

Utility Billing A/R Balancing Getting Started continued If the system is in balance and you are ready to time stamp the system for the first time, go to main menu option "Other", then option "Reports". Run option "Customer Balance Summary". This will produce a report of the total accounts receivable at the current time. The report can be produced in detail mode to list each customer and their balance, or in summary mode to produce totals by book only. THIS REPORT SHOULD BE FILED FOR AN AUDIT TRAIL OF THE BALANCING PROCESS.

Utility Billing A/R Balancing Getting Started continued Next, go to main menu option " Other", then option " Period End", then option "A/R Balance". Run option "Time Stamp A/R Balances". This will build the file necessary to balance the accounts receivable at the end of the next month. It takes a snapshot of each customer’s balance and records it with the current date and time. Since this is the start-up month, you cannot run the normal period-end balancing for this month. Stop here for the initial period!

Utility Billing A/R Balancing Normal Period-End Prerequisites Make sure all billings, payments, and adjustments batches are processed. Also make sure no monetary transactions are being posted during this balancing process. Payments can be entered into batches, but the payment processing steps must not be run while balancing. Also avoid processing anything else that changes a customer’s balance, such as adjustments, applying penalties, etc. Choose a time to run this process when others can exit the system to ensure that nothing gets posted during the balancing process. In most instances, one will choose to run the balancing process before each billing cycle. This will be the point at which the Accounts Receivable is at its lowest. Make sure to have all work done leading up to the balancing process. Once the balancing process is done, everything done in Utility Billing will need to be dated for the next working day.

Utility Billing A/R Balancing A/R Net Change Report An necessary report that prints a summary of all transactions for the range of accounts and date range selected. This report prints the total for each transaction type such as payments, penalty, penalty adjustments, etc., then computes the net change in the total accounts receivable for the ranges entered. To run this report, go to “Other”, “Period End”, “A/R Balance”, “A/R Net Change Report”.

Utility Billing A/R Balancing Step 1 Go to main menu option “Other", then option Reports". There you will want to run multiple reports to check and see if the reports balance. Run the “Customer Balance Summary" report, “Service Balance” report, and the “Aged Accounts Receivable by Summary Report”. Before you run the Aged Accounts Receivable report you will need to run the “Age Accounts Receivable” step. These reports will produce totals of the accounts receivable at the current time. You may also want to run the “Write-Off Balance Summary Report”. When you run these reports, you will want to run them for totals only. Once you have these reports you are now ready to proceed to the next step. The ending balance on the A/R worksheet should balance to the totals on the three reports. Be sure to run the reports for all statuses.

Utility Billing A/R Balancing Step 2 Go to main menu option "Other", then option "Period End", then option "A/R Balance". Run the "A/R Balancing Worksheet“ step. You will normally want to run the worksheet for all books. This will produce a report by book showing the A/R balance at the end of the previous month and the current balance. It also prints a summary of all transactions since the last balancing point for Billing, Service Adjustments, Penalty, Penalty Adjustments, Receipts, Deposits Applied, Refunds and Other. The totals in the Beginning Balance column should match the totals from the A/R Customer Balance Summary printed at the end of the previous balancing period. The totals in the New Balance column should match the totals from the A/R Customer Balance Summary printed in step 1 above. If they do not match, the Customer Balance Summary from the previous period is not consistent with the time stamp file, or the balances on some customer records have changed since running Step 1. You can rerun Step 1 and start again. You can also run the Time Stamp File Listing to determine if the previous balance report is incorrect.

Utility Billing A/R Balancing ***Example of the A/R Balancing Worksheet.***

Utility Billing A/R Balancing Customer Balance Summary A/R Balancing Worksheet ***Example of the Customer Balance Summary and A/R Balancing Worksheet*** – Notice that the ending balance of the A/R Balancing Worksheet is the same as the total balance of the Customer Balance Summary.

Utility Billing A/R Balancing Step 3 From main menu option "Other", option "Period End", option "A/R Balance", run option "A/R Balance Exception Report". This will produce a report of any customer whose records are out of balance. This report should never print any customers. If customer records are printed, the system is out of balance. This exception report prints the customer’s original balance, all the activity for the billing period, and the current balance. Use customer inquiry to view the monetary transactions to determine which transactions caused the customer to be out of balance.

Utility Billing A/R Balancing Step 4 If the system appears to be in balance, the totals for each column of transactions need to be verified to insure that they balance to the actual transactions for the month. The date range for the balancing period is very critical. If you do not remember the exact date and time of the last balancing and time stamp, run the “Time Stamp File Listing” and display the first screen of the report to see the exact date and time. The Billing column should balance to the totals from the Billing Registers printed during the balancing period. If only one billing was run during the period, the totals should match the book total and grand total pages from the Billing Register. If more than one billing was run, add the book and grand total pages from each register and this should match the Billing column.

Utility Billing A/R Balancing Balancing the Billing

Utility Billing A/R Balancing Step 4 continued The Service Adjustments column should balance to the total of all service adjustments processed during the balancing period. These adjustments include all adjustments except for penalty adjustments since there is a separate column for these on the A/R Balancing Worksheet. If you do not have all the batch reports printed during the adjustment processing, you can print a detailed adjustment report for the balancing period. To print this report, go to main menu option "Other", option "Period End", option "Reports". Run option "Adjustment Transactions". Run the report for all accounts, for the beginning and ending date of the balancing period. Leave the service, rate code, tax code and POC Code blank to print all customers. The report can be produced for service, surcharge, discount, deposit, assistance, tax or penalty adjustments. To balance to the Service Adjustment column print the report for service adjustments only. This will produce a detailed report of all service adjustments with totals by book. These book totals should match the totals in the Service Adjustment column of the A/R Balancing Worksheet. If the totals don’t match, check the date range used for the adjustment report.

Utility Billing A/R Balancing Balancing Adjustments

Utility Billing A/R Balancing Step 4 continued The Penalty column should balance to the total of the penalties applied during the balancing period. If you have only one billing cycle and penalty date, the totals in this column should match the totals from the Applied Penalties Journal printed when penalty was applied. If you have multiple penalty dates, add the totals from the journals to balance to this column. If you don’t have the Applied Penalties Journal(s) or want a single report of all penalties applied during the period, this can be printed. To print this report, go to main menu option "Other", option "Period End", option "Reports". Run option "Monetary Transactions by Type". Run the report for all accounts, for the beginning and ending date of the balancing period. Leave the beginning and ending service numbers blank to print all services. Enter 70 for the beginning and ending transaction type and leave the beginning and ending batch id blank. This will produce a detailed report of all the penalties applied with totals by book for the balancing period.

Utility Billing A/R Balancing Penalty Balancing

Utility Billing A/R Balancing Step 4 continued The Penalty Adjustments column should balance to the total of all penalty adjustments processed during the balancing period. If you do not have all the batch reports printed during the penalty adjustment processing, you can print a detailed penalty adjustment report for the balancing period. To print this report, go to main menu option "Other", option "Period End", option "Reports". Run option "Adjustment Transactions". Run the report for all accounts, for the beginning and ending date of the balancing period. Leave the service number blank to print all services. Print the report for penalty adjustments only. This will produce a detailed report of all penalty adjustments with totals by book. These book totals should match the totals in the Penalty Adjustment column of the A/R Balancing Worksheet.

Utility Billing A/R Balancing Penalty Adjustment Balancing

Utility Billing A/R Balancing Step 4 continued The Receipts column should balance to the total of all payments processed during the balancing period. The totals from all payment batch reports processed during the period should balance to this column. If you do not have all the batch reports printed during the payment processing, you can print a detailed payment report for the balancing period. To print this report, go to main menu option "Other", option "Period End", option "Reports". Run option “Monetary Transaction by Book". Run the report for all accounts, for the beginning and ending date of the balancing period. Leave the beginning and ending service numbers blank since most payments are not available by service. Enter the beginning transaction number of 93 and ending transaction number of 94. This will produce a detailed report of all payments with totals by book. These book totals should match the totals in the Receipts column of the A/R Balancing Worksheet.

Utility Billing A/R Balancing Payment Balancing

Utility Billing A/R Balancing Step 4 continued The Deposits Applied column should balance to the total of all deposits applied during the balancing period. If you do not have all the batch reports printed during the deposit processing, you can print a detailed report of deposits applied for the balancing period. To print this report, go to main menu option "Other", option "Period End", option "Reports". Run option "Deposit Transactions". Run the report for all accounts, for the beginning and ending date of the balancing period. Leave the beginning and ending service numbers blank to print all services. Select only the "Deposits Applied" option. This will produce a detailed report of all deposits applied with totals by book. These book totals should match the totals in the Deposits Applied column of the A/R Balancing Worksheet. If you do not have deposits but have meter connection fees instead, then proceed on to the next step of A/R balancing.

Utility Billing A/R Balancing Step 4 continued The Refunds column should balance to the total of all A/R refunds during the balancing period. If you don’t have the batch reports printed during the refund process, or want a single report of all refunds during the period, this can be printed. To print this report, go to main menu option "Other", option "Period End", option "Reports". Run option "Monetary Transactions by Type". Run the report for all accounts, for the beginning and ending date of the balancing period. Leave the beginning and ending service numbers blank to print all services. Enter 97 for the beginning and 98 for the ending transaction types and leave the beginning and ending batch id blank. This will produce a detailed report of all the refunds with totals by book for the balancing period. These book totals should match the totals in the Refunds column of the A/R Balancing Worksheet. If you have no refunds then proceed on to the next part of A/R balancing.

Utility Billing A/R Balancing Step 4 continued The Other column of the A/R Balancing Worksheet will include other transactions that are not covered in the aforementioned steps. An example of such would Payment Reversal transactions. Below is an example of balancing this. You will need to run the Monetary Transaction Report for the different types of transactions that have been done throughout the month that have not been balanced thus far. Keep in mind that the only transactions to balance are the ones that effect the A/R balance.

Utility Billing A/R Balancing Balancing Other A/R items

Utility Billing A/R Balancing Step 5 From main menu option "Other", option "Period End", option "A/R Balance", run option "Time Stamp A/R Balances". This will build the file necessary to balance the accounts receivable at the end of the next month. THIS STEP IS CRITICAL TO BE ABLE TO RUN THE BALANCING PROCESS NEXT MONTH. If you have any doubt about whether you completed this step, run option "E. Time Stamp File Listing" and display the report back to the screen. Verify that the time stamp date is the current date. If you have multiple accounts receivable accounts in the General Ledger and keep track of your A/R by service, you will need to run many of the reports selectively by service to get the breakdown by service. Everything except the payment report can be printed in detail by service. If you have multiple receivable accounts you will need to track the payment distribution by service from the reports produced during payment processing each day.

Utility Billing A/R Balancing Finishing Up All detailed reports and the worksheet should be filed by month as an audit trail of the balancing process. These reports along with the billing registers will provide a detailed audit trail of everything that happened in the Utility Billing system from month to month. If you have doubts about how much of the detail reports to keep, check with your auditor for an opinion. You should go back and run the Aged Accounts Receivable Report by Summary to keep on file for audit purposes. CAUTION! When running transaction reports, the beginning and ending dates are critical. If you do not use the correct dates the reports will not match with the A/R Balancing Worksheet. The worksheet includes all transactions from the exact date and time of the last A/R time stamp. If the detail reports are not produced with the same date, they will not match. YOU MUST BE CAREFUL NOT TO POST TRANSACTIONS ON A DAY, BALANCE AND TIME STAMP THAT DAY, AND THEN POST MORE TRANSACTIONS WITH THE SAME DATE. If you do this, it will be impossible to run the transaction reports and pull the correct transactions for that date.

Utility Billing A/R Balancing Other Miscellaneous Reports A/R Net Change Report A necessary report that prints a summary of all transactions for the range of accounts and date range selected. This report prints the total for each transaction type such as payments, penalty, penalty adjustments, etc., then computes the net change in the total accounts receivable for the ranges entered. Time Stamp File Listing A optional report that prints the customer balance the last time the balances were time stamped. The report can be printed for any range of accounts and will print all customers or only those with a balance at the time of the time stamp. The report also shows the date and time of the last time stamp. This can be very useful if you lose track of the dates and times.

Utility Billing A/R Balancing BALANCING THE ACCOUNTS RECEIVABLE ACCOUNTS RECEIVABLE CHECK LIST ___ Insure that all transactions are processed and that no one is processing monetary transactions. __ Print the A/R Net Change Report. __ Print the Customer Balance Summary report (Step 1). __ If you balance the A/R by service, then you need to print the Customer Balance Detail or Moderate Detail Aged Accounts Receivable report and the Service Balance report. __ Print the A/R Balancing Worksheet (Step 2). __ Print the A/R Balance Exception Report (Step 3). __ Run the necessary detailed transaction reports to verify the accuracy of each column on the A/R Balancing Worksheet (Step 4). __ When everything is in balance, run the Time Stamp A/R Balances option (Step 5). Utility Billing A/R Balancing

Thank you! Any questions?