Commissioned Sales Agents Maintenance

Document path Reference Contents > Manager Controls > Commissioned Sales Agents Maintenance

The commission system enables you to set up any number of agents and commission pools to which sales commissions can be logged and posted automatically when invoices are created.

Commissions are logged in a commissions log file when they are earned and optionally posted to the appropriate account if you have the ledgers license option. Postings can alternatively be posted manually or as part of the A/R month-end process.

The commission system revolves around two tables. There is a commission class definition table in which you define classes of commissions that you subsequently assign to parts. You then create a table of commissioned agents with associated rules including a list of commission classes that are applicable. Agents can then be assigned to customers and dispatch additional addresses so that when a sales order or job is created, agents are assigned to line items where they are listed for the customer or dispatch address and the class associated with the line item is an applicable class for those agents.

For example:
Agent: MAT classes D
Agent: POOL classes D,O,T
Agent: PWS classes T
Customer: MAT,POOL,PWS
therefore of a sales order:
Class for Item: D agents will be MAT,POOL
Class for Item: O agent will be POOL
Class of Item: T agents will be POOL,PWS

Tip TIP: There is a system level option optCommissionRoyalty that, if set to 1, when applying agents on a SO, Job or Invoice, agents entered in the User character field 4 (PTMUSE4) parts field are added to the agent list. This provides for circumstances where you want to use the commission system to account for royalties that need to be applied for parts regardless of commission class or customer agents.

Commission systems adopted by businesses vary significantly. The program logs earned commissions when invoices are created. If this is fundamentally contrary to your approach either modify your commissioning system or do not use the program's built-in system.

Note NOTE: Commissions are not logged on dispatch when the sales order is marked as No Invoice on Dispatch nor for a Cash-Before-Delivery Invoice until it is dispatched.

Tip TIP: Commissions equally operate for Returns for Credit or ad-hoc Credit Notes and these produce negative log entries which reduce the agent's net entitlement.

Tip TIP: Commissions are earned when invoices are raised which is when the sale is recorded. No account is taken of whether the invoice is subsequently paid by the customer. In the event of bad debts that cannot be handled by credit notes, where your commission rules demand, you must manually adjust the payments to agents or apply reverse postings (see the Sales Commissions Review window for these functions).

Warning WARNING: Without the Ledgers program license option Commission Logging can only be processed manually and reports used to determine agent payments.

Pool Commissions

The concept of pool commissions is simply that commissions earned are collected in a 'pool'. At the end of a period the funds accumulated in the pool are shared amongst the 'pool members'. Each member is allocated a number of 'pool points'. Each member's allocation from the pool is a proportion based on their pool points divided by the sum of all pool member's points. So if the there are 3 members with respectively, 4, 3 and 5 pool points, the first member gets 4/12ths, the second member gets 3/12ths and the third gets 5/12ths.

Pool agents are not themselves identified as such. They are, however, referred to by their members as 'Pool membership' agents. You can have any number of pools, and with mixed memberships.

When pool commissions are distributed to their members, credit commission entries are created from the pool so that a properly maintained pool should have a net zero pool value after full posting.

Ledgers Postings

Posting Commission

When commissions are posted to the ledgers, either automatically or from the Sales Commissions Review window, the following transactions take place. When commission log entries are made, one entry for each agent is made for each line item. However, ledger postings are consolidated for each agent's account combination. When postings are made from the Sales Commissions Review window or at A/R Month-End, commission log entries are consolidated into the least number of resulting ledger transactions.

This process applies the commission as a charge to a trading cost account and accrues it to an appropriate asset accrual account, for distribution later. In this way the commission cost of the sale is properly accounted for and accrued as a debt to the agents on the balance sheet.

Transaction process

Commission Posting Transaction

Type 045

Debit

Commission amount

to G/L cost posting account

Credit

Commission amount

to G/L accrual a/c

Distributing Pool Commissions

These postings are made from the Sales Commissions Review window or at A/R Month-End, commission log entries are consolidated into the least number of resulting ledger transactions.

This process looks at only those agents that are 'pool' agents. Agents that are 'pool' agents are those that are listed in other agents details as 'Pool membership' agents. This process takes the commissions earned by these agents and distributes it amongst its members on a pro-rata basis according to the member's pool points. The process transfers accrued commission from the pool agent accrual account to the members' accrual accounts. This should have no affect on the asset balance sheet as it simply moves accruals from one asset account to others.

Transaction process

Commission Posting Transaction

Type 045

Debit

Total pool commission amount

to Pool Agent G/L Accrual account

Credit

Commission amount appropriate to each member of the pool

to Pool Member's G/L Accrual a/c(s)

Posting Commissions to Supplier Invoices

These postings are made from the Sales Commissions Review window or at A/R Month-End, commission log entries are consolidated into the least number of resulting ledger transactions.

This only affects those commission agents where there has been a supplier assigned. The process takes such agent's posted commission and generates a standard A/P invoice entry, posting the cost to the agent's accrual account.

Transaction process

Purchase Invoice

Type 030

Debit

Total Commission + Tax amount

to A/P supplier a/c

Debit

Net amount only

to Pool Agent G/L Accrual account

Debit

Tax amount only

to G/L tax control a/c(s)

Credit

Net + Tax amount

to G/L creditors control a/c

Note NOTE: There is a function in the Advanced Data File Integrity Maintenance window to archive and delete unwanted historic commission log records.

The window has two tab panes.

Commissioning Classes

Commissioned Agents

Commissioning Classes

Use this pane to maintain a list of classes of commissions that apply to parts to determine whether agents receive commissions.

Field

Description

List

List of all classes. Click to edit description.

Class

Commission class table. Commission class (for parts, work centres, and default non-part items). {COLFILE.COLCLAS char 1}

Description

Commission class table. Commission class description. {COLFILE.COLDESC char 30}

Button

Action

New Class

Click to add a new class to the system.

Revert

Revert the edited data to that saved on file.

Save

Save the edited class and commission data to file.

Print Report

To print a report of class and commission setup.

Back to top

Commissioned Agents

To maintain the commissioned agents.

Field

Description

List

List of all agents. Click to view full details.

Agent identifier

Commissioned sales agents. Commissioned agent Id code. {COMFILE.COMID char 4}

Description

Commissioned sales agents. Agent description. {COMFILE.COMDESC char 30}

Cost posting account

Commissioned sales agents. G/L account for cost posting of commission on invoicing. {COMFILE.COMACCO char 10} This field only has a value for custom reports when you are operating without the Ledgers program license option.

G/L description

General Ledger Accounts. Description. {GLAFILE.GLADESC char 40}

Accrual account

Commissioned sales agents. G/L account for accrual posting of commission on invoicing. {COMFILE.COMACCR char 10} This field only has a value for custom reports when you are operating without the Ledgers program license option.

G/L description

General Ledger Accounts. Description. {GLAFILE.GLADESC char 40}

Automatically when commission earned

Commissioned sales agents. Post ledger transactions when commission earned (as opposed to a manual batch operation). {COMFILE.COMPOST boolean}

Warning WARNING: This has no operating value without the Ledgers program license option. When this option is used the cost and accrual postings are made at the same time as invoice postings. This can greatly increase the transaction rate for sales

Supplier posting

Commissioned sales agents. Related supplier code needed to generate postings of accrued commission to an A/P account. {COMFILE.COMSUPC char 6}

Supplier name

Suppliers. Supplier company name. {SUPFILE.SUPNAME char national 40}

Tax class

Commissioned sales agents. Supplier posting tax class when commissions are posted as invoices. {COMFILE.COMSUPC char 1}

Tax class description

Tax class definitions. Class description. {TACFILE.TACDESC char 30}

Pool membership

Commissioned sales agents. Commission pool commissioning agent Id list (comma separated if a member of more than one pool). {COMFILE.COMPOOL char 100}

Pool points

Commissioned sales agents. Pool membership points list (comma separated if a member of more than one pool). {COMFILE.COMPOPT char 100}

Classes applicable

Commissioned sales agents. Comma separated list of commission classes appropriate (* = all). {COMFILE.COMCLAS char 100}

Tip TIP: There is a system level option optCommissionRoyalty that, if set to 1, when applying agents on a SO, Job or Invoice, agents entered in the PTMUSE4 parts field are added to the agent list. This provides for circumstances where you want to use the commission system to account for royalties that need to be applied for parts regardless of commission class or customer agents.

Percent rate

Commissioned sales agents. Percent commissioning rate. {COMFILE.COMRATE number float}

Calculation method alternatives

Commissioned sales agents. Commission calculation method (0 = Net sales value, 1 = List sales value, 2 = Net margin on current cost, 3 = Net margin on standard cost, 4 = Current cost value, 5 = Standard cost value). {COMFILE.COMMETH integer shortint}

The calculation of commission is based on the item's sale price, discount, current cost or standard cost. On non-part items the cost is zero, so great care should be taken in applying margin-based commissions on no-part items.

Tip TIP: There is a system level option optCommissionLogCosts that, when set to 1, can be used to override the normal behaviour of not recording costs in the log unless they are relevant to the calculation method being applied.

Flat rate in local currency

Commissioned sales agents. Flat rate commission amount per sales UoM unit quantity (SAHQTY). {COMFILE.COMFLAT number 2dp}

Any flat rate commissions are added to the rate-calculated commission to yield a total commission on any item.

Button

Action

New Agent

Click to add a new agent to the system.

Revert

Revert the edited data to that saved on file.

Save

Save the edited class and commission data to file.

Print Report

To print a report of class and commission setup.

Back to top

See also: -

Compiled in Program Version 3.10. Help data last modified 22 JAN 2003 14:16. Class wComMaint last modified 21 MAY 2008 13:31:40.

Document path Reference Contents > Manager Controls > Commissioned Sales Agents Maintenance