Overview
Billing categories are used to classify groups of contract charges. You can manage them within Settings--Financial--Billing Categories.
- Billing categories can have groups, within these groups there can be multiple charges and multiple credits per group. To learn to add new categories and category groups, continue reading. Example: If your school has multiple tuition categories, lower, middle, and upper, you can group them together along with your tuition credit categories.
- You also have a prepaid billing category that redistributes credits/payments to billing categories with positive charges every day.
Please note: While this article contains information for all schools, some parts of it (such as references to the ledger) will only apply to schools utilizing our Billing module.
Create a New Billing Category Group
IMPORTANT: Make sure you read the "Billing Category Setup Best Practices" article so that you do not create more categories than what we recommend for clean reporting and streamlined ledger views.
To add a new billing category group, click on the green plus sign --> Add New Billing Category Group.
Billing Category Settings
-
Applies to Student Balance: Categories that apply to a student balance describe charges and credits that will be applied to a student, such as Tuition, Trip Fees, etc. This is the default for all billing categories. An example of a category that does not apply to a student is a late fee, which are assessed to individual payers. Late fees are optional as part of your billing setup and will not be assigned by default. They're also dependent upon your grace period, if one is set.
- Excluded from Automatic Overpayment Logic: When a parent/payer overpays, the additional amount would be applied based on the next outstanding ledger items, however, it would ignore any billing categories with this 'Excluded' flag set.
- Revenue Recognition Start Month: Set the start month for each category grouping to appear in the revenue recognition report.
- Revenue Recognition End Month: Set the end month for each category grouping to appear in the revenue recognition report.
- Revenue Recognition Allocation Rule: Set the allocation rule for each category, which will be reflected in the revenue recognition report.
Click here to read more about the Revenue Recognition Report.
View Edit History
When you click on 'View Edit History,' you'll have the option to select the subcategory that you want to audit.
The 'Recent Edit History' will display the user that made the change, the date that the change was made, and what changes were made to what fields/settings.
Moving Categories
Moving a category allows flexibility to structure your category groups. You can only move one category at a time. You can move categories into inactive categories, which will automatically make them inactive.
- While moving, you have the ability to distinguish the category type, in case you need to change it. Example: If there is only one credit category, within a charge group, you will have to move the credit category first, before you can move the charge category.
Editing
Along the far right, you can click on 'edit' for each billing category to update the details displayed within this page.
*Important Note about editing billing categories*
If there is a balance in a student category, and you are trying to change it to be a parent/ account category, or the reverse of this, you will not be able to preform this change. You will be prompted a validation error. A best practice would be to make a new category, this way it will not cause any problems with reporting.
View Edit History
Within a category group, you will be able to see all previous changes made within that category. If there are multiple subcategories, you can click one and see the changes made specifically for that subcategory.
Once you have clicked inside a category to see the recent edit history, it will look similar to this. Showing the previous state of the category to the left of the arrow, and the current state of the category to the right of the arrow.
To add a new credit category or charge category, click the corresponding green plus sign at the bottom of the category group.
-
Name: The name of the billing category used to classify ledger items. A billing Category needs to be created for each Account Code. Contract fees are associated with corresponding billing categories, and multiple fees can be applied to each.
-
Account Codes: This field is specific to FACTS clients, however, you can add account codes for your own internal reference for your GL. Please note, these codes aren't currently available in search or in an export and don't drive any behaviors in the system for Billing customers.
-
Adjustment Codes: This field is specific to FACTS clients, however, you can add adjustment codes for your own internal reference for your GL. Adjustment codes are set for any credits, and they provide the description for why a credit is applied to an account. Please note, these codes aren't currently available in search or in an export and don't drive any behaviors in the system for Billing customers.
-
Ledger Account Code: Schools can define a general account code for each billing category. This code is available within Billing export templates, the Ledger Report, and the Payout Report.
-
Save: Click this button to save any changes or additions that were made while editing. If you close the dropdown without clicking save, it will erase anything you edited.
How Payments are Applied
Payments are allocated based on both billing category and term.
When a payment is posted to a ledger, the payment applies based on all outstanding balances in the earliest term and applies the payment based on the order of the billing categories.
To put it simply, if a parent owes a balance in more than one term, their payment will cover the older term's balances in all categories before starting to apply the payment to the more recent term.
Let's look at an example.
Example Billing Category Order:
- Tuition Category
- General Fees Category
Sample Criteria:
- Student Balance is $1,200
- $100 is for 21-22 Tuition
- $200 is for 21-22 General Fees
- $500 is for 22-23 Tuition
- $400 is for 22-23 General Fees
Given the example ledger above, if a parent pays $500, the payment will apply as follows:
- $100 goes to 21-22 Tuition
- $200 goes to 21-22 General Fees
- $300 goes to cover part of the $500 charge for 22-23 Tuition
Note how the payment first went to cover the 21-22 outstanding charges, based on the order of their category, then, it started applying to the 22-23 charges.
The parent can't allocate where the amount goes, however, the school can make this adjustment within the payer's record if needed. This means that we're allowing parents to overpay or underpay the amount due, based on the order of the billing categories.
*Important Note about Payments*
If a credit category has a positive amount a payment will not be applied to this. We only apply payments to charges and charge categories.
Within the 'Balances' tab in a billing account's ledger, the category groups display with the carat dropdown, it will show all of the credits and balances inside of that category group as seen below. Those balances sum up to the total of the charge group.
*Important Note about Billing Category Order*
The term the charge is owed in and the order of the categories in this page determine the precedence when applying payments and discounts to billing balances. Categories higher on the list will have discounts applied to them before categories lower in the list.
To set the order of your billing categories, drag and drop them by clicking on the icon to the left of each billing category name. This applies within the category groups as well.
Comments
0 comments
Article is closed for comments.