Dunning terms are relevant for the automatic creation of dunning letters.

To access this window, choose: Administration > Setup > Business Partners > Dunning Terms.

Dunning Terms Setup Fields

Letter Layout
Choose an appropriate letter layout for the dunning level. For a general letter that is not related to a dunning level, choose Dunning All.

Code, Name
Define a code and a name for the dunning term.

Dunning Levels
Specify the required dunning level.

Apply Letter Layout by Highest Level
If you select this checkbox, the layout for the highest dunning level of all documents included in the letter is used.

This checkbox is available only if you choose one of the following dunning letter methods:

  • One Letter per Dunning Level
  • One Letter per BP

Effective After (Days)
Displays the number of days after which the dunning level is effective (required). The value of the field is accumulative from one level to the next.

Example
If two dunning levels are defined in the Effective After (Days) field, the value for level 1 might be 30 days and the value for level 2 might be 10 days. The level 1 dunning letter becomes effective 30 days after the due date of the invoice. The level 2 dunning letter becomes effective 10 days after the level 1 dunning letter is generated.

Fee Per Letter
Displays the fee determined for this dunning letter. You can change this amount if required.

Minimum Balance
Displays the minimum balance for the dunning letter. You can change this amount if required.

Interest
To include interest in the dunning fee calculation, select this checkbox. You can specify the interest settings in the Bank Interest % area in the lower right corner of the window.

Dunning Letter Method
Select one of the following methods for the creation of the dunning letter:

  • One Letter per Invoice – select this option to create a dunning letter for each invoice.
  • One Letter per Dunning Level – select this option to group all the debts related to the same dunning level into one dunning letter. This option is selected by default.
  • One Letter per BP – select this option to create one letter for each business partner, even if the debts of the customer comprise more than one dunning level.

Letter per BP Term
If you choose the dunning term All in step 2 of the dunning wizard, the values you enter here are used in the dunning letters to the customers instead of the ones defined for the dunning levels in the table.
This field appears only if you use the dunning letter method One Letter per BP and have not selected the Apply Letter Layout by Highest Level checkbox.

Bank Interest %
Define the interest rate to be used in calculations in the dunning letter:

  • Number of Days in Year – the default value is 360. Enter a different value, if required.
  • Yearly Interest Rate – to be used for calculating the interest per year.
  • Number of Days in Month – the default value is 30. Enter a different value, if required.

This field appears only if you selected at least one Interest option in this window.

Automatic Posting
Specify whether to automatically post interest and fee, interest only, or fee only when creating a dunning letter for a customer. If you choose to automatically post interest and/or fee, a service invoice is created in the dunning run that posts the interest and/or fee. To enable this, accounts for posting interest and fee must be specified. The default accounts are taken from the G/L account determination. However, you can change this setting by choosing the Browse (Browse) icon and specifying different accounts.
You can also choose not to post any interest or fee.

Exchange Rate for Interest Calculations
Choose whether to use the original exchange rate defined in the invoice, or to use the exchange rate defined for the day on which the dunning letters are created. This option is relevant when calculating interest in foreign currency.

Base Amount for Interest Calculations
Choose whether to calculate the interest on the remaining amount (default option) or on the original sum of the debt.
This field appears only if you selected at least one Interest option in this window.

Base Date for Interest Calculations
Choose whether to calculate interest starting from the due date or the last dunning run.