Does Customer retention apply to customer advance deduction as well??

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Posted on by Jiwannawij

Dear Experts,

I am facing an issue where the customer retention is applied on the overall invoice value including customer advance deduction. Current scenario, i have an progressive billing rule set as 100,000 , retention is set as 5% for all billing. And advance of 10,000 has already been invoiced against the project. Now when i update the contract status as 20% completed, the invoice proposal is automatically created for 20,000 with 5% retention(-1000). I am going to deduct 15% from the customer advance(-1500).

So when i check the totals i am getting exact figure of 17500(20000-1000(Retention)-1500(Advance)). When i post the invoice, the system is calculating the invoice amount as 17575(Which adds the retention value to advance as well). This in-turn updates the progressive billing percentage as well.

Is this how the standard module works? Please advise.

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Ludwig Reinhard Microsoft Employee on at

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Hi Jiwannawij,

How have you posted the advance?

Did you you setup a separate on-account transaction for that purpose or make use of your progress billing rule?

What is it with the 15% deduction?

Why you deduct 15%? What tool have you used for this? Is this the mix of your retention of 5% from the $20000 and the 5% of the $10000 advance?

Would be great if you could clarify.

Best regards,

Ludwig

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Jiwannawij 50 on at

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Hi Ludwig,

I posted the advance from customer advance on manage tab of FP project.

I setup a billing rule type as progress from project contract(100,000 overall value and 20% completed).

initial advance was 10,000 and i deducted 1500 off current inovice, 20,000(invoice value) - 1500.

I have a retention term of 5 % defined in the progressive billing.

Thanks

Jiwan.

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Ludwig Reinhard Microsoft Employee on at

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Hi Jiwan,

I tried to replicate your case but did not run into the same issue. Here the steps that I took:

1 . Create a FP project & contract with a progress billing rule and the 5% customer retention

2. Create a second milestone billing rule for 10000 that does not have a customer retention attached => this milestone billing rule will show up as an on-account pre-payment in the on-account form of your project

3. Create the on-account invoice for 10000 => no retention is recorded

4. Manually set the progress to 20% and create the invoice proposal => only 1000 is posted as retention and the total invoice is posted with a total of 19000.

I believe the issue is with your prepayment and how you recorded it.

Can you double check and try to replicate my steps?

If you have problems, let me know and I can post your all the respective screenprints

Best regards,

Ludwig

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Jiwannawij 50 on at

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Thanks Ludwig, Did you reconcile the customer advance while posting the invoice?

Let us assume your scenario, on top of 19000, you have reconciled advance of 1500 from prepayment journal which you posted earlier.

Now the expected result would be 19000-1500 right? 17500 as invoice value after posting.

I am getting 17,575, so basically the retention is calculated after advances are reconciled. Here the requirement is deduct the line level retention first and then reconcile the advances.

Can you please confirm if that is how you are getting?

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Ludwig Reinhard Microsoft Employee on at

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Hi,

What did you do exactly when you say reconcile the customer?

Best regards

Ludwig

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Jiwannawij 50 on at

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Create an On-account transaction as type prepayment journal. This prepayment will be re-reconciled with every progress billing.

When you open the customer advance under manage tab and post it. system automatically records it as prepayment entry in On-account form

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Ludwig Reinhard Microsoft Employee on at

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Hi,

I do not see an issue with the Standard application. Please see my following replication steps in an AX2012 R3CU12 demo machine.

Step 1: Create Milestone billing rule for the prepayment

Step 2: Create Progress billing rule with 5% retention

Step 3: Maintain the contract Status for the prepayment

Step 4: Create and post the prepayment invoice for $10000

Step 5: Post the customer payment for the $10000 prepayment

Step 6: Maintain the contract Status and generate the customer invoice

=> an invoice for 20% * 100000 = 20000 is created and a Retention of $1000 is posted.

=> the retained amount can be identified through the inquiry forms

The customer payment does not have an impact on the invoice created.

Hope this helps.

Best regards,

Ludwig

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Jiwannawij 50 on at

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Thanks ludwig, that was a crystal clear explanation. I tried similar scenario but for prepayment I did not create a billing rule type milestone. Instead I created as customer advance from project.

Is it possible to deduct the milestone value against actual invoice value? For example, I created a prepayment of 10000 and I want to deduct 5 percentage across all invoices until the advance is settled against actual value.

If I post it as customer advance, the system gives an option to reconcile against every invoice partially. So that the actual invoice will be knocked off against advance. In this case I am facing issue with calculating retention and advances on same invoice proposal.

Thanks

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