Setup and Collection
A practical guide to configuring fees, applying them to suggested payments, and reviewing accruals.
Purpose
Use transaction fees to charge a fixed amount when suggesting factoring payments to a client. For example, a factor can charge a payment processing fee when paying an advance or releasing a reserve.
The system creates a separate Fee Accrual journal line for each applicable fee and payment group. Depending on the collection method, it also reduces the suggested payment amount or leaves the fee for separate invoicing.
This guide covers automatic transaction fees created by payment suggestions.
Prerequisites
Before setting up transaction fees, check the following:
The agreement uses Strict Accounting and Use Multiple Fees.
For Batch or Agreement accounting granularity, Post Vendor Accruals is enabled.
The client has the customer/vendor links and posting setup required for factoring payments and fee invoicing.
Source Code Setup contains a value for S4LF Fee Accruals.
The fee has a revenue G/L Account, an Accrual G/L Account, and a VAT Posting Group.
The effective VAT rate for the fee and the client's customer is zero. Non-zero VAT is not supported for transaction fees.
The suggested payment currency matches the agreement currency.
Set up a transaction fee
1. Open Factoring Fees and create a fee code with a suitable description, such as Payment Processing Fee.
2. Set Fee Type to Transaction Fee.
3. Open the Fees section of the factoring product or agreement and add the fee code.
4. Open the fee card and enter Fee Amount in the Transaction Fee section.
5. Select the Collection Method.
6. In Accounting, specify G/L Account and VAT Posting Group.
7. In Accrual, enable Post Fee Accrual and specify Accrual G/L Account.
8. Check the fee setup on the agreement and, where applicable, its batches or invoices before suggesting payments.
Product fees provide defaults for agreements. Agreement fees are copied to new batches or invoices according to their scope. Configure the fee before creating the records that will use it; do not assume that adding an agreement fee afterwards creates missing fee records on existing batches or invoices.
Setup fields
Field |
Description |
Code |
Identifies the fee. Several different transaction fee codes can be configured for the same agreement. Each applicable fee is assessed separately. |
Fee Type |
Select Transaction Fee. The calculation uses a fixed amount, not a percentage. |
Fee Amount |
Fixed charge in factoring currency for one payment group. It is separate from the accumulated calculated fee amount. The charge is rounded using the agreement currency's amount rounding precision. |
Collection Method |
Determines which suggested payments can be reduced and whether journal posting triggers automatic fee invoicing. See the table below. |
G/L Account |
Fee revenue account used as the balancing account on the accrual journal line. |
VAT Posting Group |
VAT product posting group for the fee. Together with the client's customer setup, it must give an effective VAT rate of zero. |
Post Fee Accrual |
Enables the fee for automatic accrual creation during payment suggestions. |
Accrual G/L Account |
Account debited when the transaction fee accrual is posted. |
Accrual Period |
Not required for transaction fees. These fees are assessed from payment suggestions rather than a periodic accrual schedule. |
Important: A fee amount that rounds to zero does not create an accrual line or reduce a payment.
Fee scope and payment grouping
The fee's Fee Granularity determines its scope. Defaults follow the accounting setup; review the applicable fee record rather than treating every journal line as a separate charge.
Fee granularity |
Scope of one charge |
Invoice |
One charge for each payment group belonging to the same agreement, batch and invoice. |
Batch |
One charge for each payment group belonging to the same agreement and batch, potentially covering several invoices. |
Agreement |
One charge for each payment group belonging to the same agreement, potentially covering several batches or invoices. |
Within that scope, payments are grouped only when their journal batch, document number, document date, posting date, vendor, currency, balancing bank account and recipient bank account match. Different values create separate groups. For example, using a new document number for each line can result in separate fees.
Advance payments, reserve releases and collection payments can belong to the same group. The fixed fee is charged once per fee code and group, not multiplied by the number of source payment lines.
Only payment lines created by the current suggestion run are considered. Existing unrelated lines in the journal are not used to fund the new fee.
Collection methods
Collection method |
Reduction of suggested payments |
Fee invoicing |
From Advance |
First reduces Collection Payment, then Advance Payment, then Reserve Release lines in the same group. |
Journal batch posting automatically creates and posts the fee sales invoice and processes collection according to the fee setup. |
From Reserve |
First reduces Collection Payment, then Reserve Release lines. Advance payment lines are not reduced. |
Journal batch posting automatically creates and posts the fee sales invoice and processes collection according to the fee setup. |
Sales Invoice |
Does not reduce suggested payments. |
The accrued fee remains for the normal Factoring Invoicing Run; payment journal posting does not automatically invoice it. |
Within each payment type, deductions follow journal line order. A deduction can span several eligible lines. When several fee codes apply, each fee uses the amounts remaining after earlier deductions.
Insufficient payment amounts
The system does not make a payment negative to cover a fee. It reduces eligible positive amounts as far as zero and retains zero-amount journal lines.
The full fee accrual is still created even if the eligible payments cannot cover it. The fee is not reduced to the amount deducted, and insufficient funds do not cause the suggestion to reject the fee. Review available balances and the subsequent billing/collection outcome before posting; a full accrual does not mean the full fee has been collected.
For From Reserve, an advance-only suggestion therefore creates the fee accrual without reducing the advance.
Suggest and post payments
1. Open the Payment Journal and select the journal batch to use.
2. Run Suggest Factoring Payments. Where the workflow uses S4LF Suggest Vendor Payments, transaction fee assessment also applies to the factoring payments it creates.
3. Enter the Posting Date, Starting Document No. and balancing bank account. Apply the required agreement and batch filters.
4. Select the required payment options: Suggest Factoring Advance Payments, Suggest Factoring Reserve Release, or Suggest Factoring Collection Payments, where available.
5. Run the suggestion.
6. Review both the payment lines and the separate Fee Accrual lines before exporting or posting payments.
7. Post the journal batch using the normal journal posting action.
For each applicable fee, check:
Factoring Entry Type is Fee Accrual on the separate fee line.
The fee line contains the correct fee code, agreement and, where applicable, batch or invoice.
The fee amount matches the configured charge.
The account is the accrual G/L account and the balancing account is the fee revenue G/L account.
The outgoing payment amounts reflect the collection method and deduction priority.
The source payment lines do not need a transaction fee code: the fee code is carried by the separate accrual line. Automatic fee invoicing runs as part of journal batch posting, not merely when an individual payment line is posted by another process.
Important: Suggestions assess fees at generation time. If you manually change payment amounts, document numbers or fee lines afterwards, review the payment and accrual together. Do not assume deductions or grouping are recalculated automatically after manual edits.
Invoice fees collected by sales invoice
For a fee with Collection Method = Sales Invoice:
1. Suggest and post the payment journal, including the fee accrual line. The vendor payment is not reduced for this fee.
2. Run Factoring Invoicing Run for the relevant agreement and date, using All where appropriate to include the transaction fee.
3. Review the generated sales invoice and its fee amount.
4. Post the sales invoice and collect it through the normal customer payment process.
Do not treat the accrual posting itself as a posted sales invoice or a customer payment.
Review posted fees
Open the applicable fee card and review Transaction Fee Details.
The read-only list shows the posted accrual entries, including document number, posting and document dates, agreement, batch, invoice, fee code, Amount (CCY), Gen. Ledg. Entry No., and Reversed.
Use Factoring Entries and the related G/L, customer and vendor ledger entries to reconcile accrual, billing and collection. These are separate stages: an accrued amount is not necessarily billed, and a billed amount is not necessarily collected. The configured Fee Amount remains the unit charge; accumulated amounts come from posted activity.
Examples
Single advance: An advance of EUR 1,000 and a fee of EUR 5 with From Advance produce a payment of EUR 995 and a separate EUR 5 accrual line.
Deduction across payment types: A group contains a EUR 2 collection payment, a EUR 10 advance payment and a EUR 20 reserve release. A EUR 5 fee with From Advance reduces the collection payment to zero and the advance to EUR 7. The reserve release stays EUR 20. There is one EUR 5 accrual, not three fees.
Insufficient funds: Eligible payment amounts total EUR 3 and the fee is EUR 5. The eligible payments are reduced to zero, but the accrual remains EUR 5. Review the outstanding fee and posting outcome; do not assume the remaining EUR 2 is waived or collected.
Batch fee: Two invoices share the same batch and payment group. A batch-scoped fee of EUR 5 creates one EUR 5 accrual. Separate payment documents can create separate groups and additional charges.
Troubleshooting and corrections
Situation |
What to check |
No fee accrual appears |
Check Post Fee Accrual, a non-zero rounded Fee Amount, the agreement fee definition, and the applicable batch/invoice fee copy. Confirm the suggestion created eligible factoring payment lines. |
Setup validation prevents processing |
Check Strict Accounting, Use Multiple Fees, G/L accounts, VAT posting group, source code and agreement currency. |
Non-zero VAT error |
Check the effective VAT rate from the fee's VAT posting group and the client's customer setup. Transaction fees require zero effective VAT. |
Advance not reduced |
Check whether Collection Method is From Reserve or Sales Invoice. Also check whether collection payments absorbed the deduction first. |
More fees than expected |
Check different document numbers, dates, bank accounts, fee codes and fee scopes. One fee is assessed per applicable fee code and payment group. |
Fee not automatically invoiced |
Sales Invoice collection intentionally waits for the invoicing run. For other methods, confirm the fee accrual was included in normal journal batch posting. |
Before posting, correct payment and fee accrual lines together. After posting, review the related accrual, sales invoice and collection entries before deciding which correction is required. Do not assume that a payment reversal, credit note or chargeback refunds every transaction fee, especially a fee shared at batch or agreement level. A sales credit memo corrects billing; it should not be treated as proof that the original fee accrual has also been reversed.