You can use Accounts Receivable to account for retainage (or a "holdback") that occurs when your customer withholds a percentage of an invoiced amount, usually by mutual agreement or according to a statute (such as a Builders Lien Act).
Before you can process retainage in Accounts Receivable, you must:
- Set the Retainage Accounting option on the Processing tab of the A/R Options screen.
- Specify retainage settings for customers on the Retainage tab of the A/R Options screen. For more information, see A/R Options Screen.
- Specify a retainage account for each account set in your Accounts Receivable system. For more information, see A/R Account Sets Screen.
Retainage Document Numbering
Accounts Receivable assigns the next available invoice, credit note, or debit note batch number to the retainage batch.
If you use a separate numbering system for retainage documents, the program assigns the next retainage invoice, retainage debit note, or retainage credit note number displayed on the Retainage tab on the A/R Options screen.
Scheduled Reminders
You assign a schedule for processing retainage on the Retainage tab of the A/R Options screen.
If you assign a schedule that includes a reminder to users, Accounts Receivable can remind users to process retainage transactions when they are due.
Users can then process the retainage transactions directly from the Reminder List in Common Services, rather than from the A/R Create Retainage Batch screen. For more information about using schedules and reminders, see the System Manager help.
Optional Fields
Accounts Receivable inserts on retainage documents any optional fields and values specified on original invoices, credit notes, and debit notes when you create a retainage batch. You do not specify optional fields and values separately for a retainage batch.