Using Commission Processing

In the Accounts table, add a separate Sales Commission Payable Account (2000s range) for your sales reps and brokers. Add a separate Sales Commission Expense Account and Broker Commission Expense Account. See Accounts for more information on how to add to the chart of accounts.

Commission Types determine whether commissions for a particular item sold are to be calculated on a per pound, percent of the net sales dollar, percent of gross profit dollars, percent of gross margin percent basis, or not at all. Make sure that one type (00) is made for "No Commission". Each commission type may be set up as having retroactive or progressive commission calculations. See Adding a Commission Type for more information about adding commission types.

Set the Sales Rep and/or Broker Commission flag(s) to Y (Y=yes) in Ledger Options. Then, define the default sales rep and broker commission expense account and commission payable accounts in Ledger Options. Define the default commission type (also found in Ledger Options) to apply to credit memos, debit memos, and hand prepared invoices.

Note: The default Commission Expense and Payables Accounts is used as the default expense account for the sales rep or broker. It can be over-ridden by sales rep or broker and sales category.

For all items, establish a commission type for the sales reps and/or brokers, depending on who you pay commissions to.

1. Select Item from the main menu.

2. Select Item from the Item menu.

3. A Select An Option window will appear; select the item(s) from the list or select Quick Maintenance. Scroll to the appropriate selection and press Enter to assign the sales rep and broker commission type to the item(s). See Item for more information.

Set the Sales Rep Commissions flag in Ledger Options to Y (Y=yes) for the sales rep if they will be paid a commission. For each commission type, set the rates applicable to each sales rep and their payment levels. See "If Commissions Are Being Used" in Adding a Sales Rep for information on how to set up commissions for sales reps.

Note: Commission rates for each commission type must be set for every sales rep in order to calculate commissions. If the type does not apply to the sales rep, set a rate of $0.00.

Set the Broker Commissions flag in Ledger Options to Y (Y=yes). For each commission type, set the rates applicable to each broker and their payment levels.

See "If Commissions Are Being Used" in Adding a Broker for information on how to set up commissions for brokers.

Note: Commission rates for each commission type must be set for every broker in order to calculate commissions. If the type does not apply to the broker, set a rate of $0.00.

1. Scroll down the Commis column and enter the correct commission for the sales rep or broker or enter 99999 to accrue the commission.

Note: By entering 99999 a payable can be changed to an accrual. Once a payable has been changed to an accrual it cannot be changed back until the next commission processing period.

2. Use the Tab, Page Down, Enter or arrow keys to move through remaining fields. Command options will appear:

• Change – Select Change to change commission amounts for the sales rep or broker.
• Print(X) – Select Print(X) to print the report detail for the sales rep or broker. See Printing Commission Processing for more information

Important: Reports must be printed prior to updating the commission processing. Once updated, the reports are no longer available and cannot be recreated.

• Next Page/Prior Page – Select Next Page/Prior Page to move forward or back one page, if there is more than one page of information.
• Update Comm – Select Update Comm to save changes made to the sales rep and broker commission.
• Return – Select Return to return to the window displaying the items for which commission have been accrued, the commission types, and calculated commission amounts.

• Select Accrual Report to print the detail transaction line information that compares the commission amount calculated to the commission sales type price exception entered. The following message will display: "Subtotal by order? No/Yes."
  • Select no to exclude subtotals for each sales order and credit order. Command options will appear allowing you to print or choose from a set of other print options.
  • Select yes to have each sales order and credit order subtotaled on the report. Command options will appear allowing you to print or choose from a set of other print options.
• Select Regular Reports(X) to print the sales commissions payable and the sales commission accrued. The following message will display: "Subtotal by order? No/Yes."
• Select no to exclude subtotals for each sales order and credit order. Command options will appear allowing you to print or choose from a set of other print options.
• Select yes to have each sales order and credit order subtotaled on the report. Command options will appear allowing you to print or choose from a set of other print options.

 

See Printing Commission Processing for more information.

Important: Reports must be printed prior to updating the commission processing. Once updated, the reports are no longer available and cannot be recreated.

The Next Page/Prior Page command option will only appear if there is more than one page of information.

After changes have been made to a sales rep's or broker's commission, Update must be selected for the changes to take effect.

Before selecting Update, however, users should:

• Make any required changes
• Print the necessary accrual and regular reports.

Important: Reports must be printed prior to updating the commission processing. Once updated, the reports are no longer available and cannot be recreated.

To Update Commissions Processing:

Updating commissions saves the changes to the commission amount paid, changes the earned amount to accrued, and updates each commission amount as it is paid.

1. After selecting the Update Comm from the command options, the following message will display: “Print first for detailed record of commissions!!! Continue? No/Yes”. (This does not mean that the system will print the reports at this step)

• Select no to return to the command options.
• Select yes to continue. The following message will display: “Commissions will be updated for amount shown!!! Continue? No/Yes”.
  • Select no to return to the message line commands.
  • Select yes and a journal entry will be created by sales rep. The following message displays: “Commissions completed for ___(sales rep or broker ID), JE #___(journal entry reference number)!!! Space bar to continue. The entry may be viewed in Journal Entries and will display in Post Batches.

 

Note: During update, the invoice databases are locked. Other users on the network will not be able to invoice. Plan your update around invoicing.

Note: The first time commissions is run, the calculation will include all invoices in the system up to the ending date. To align your system so that accruals and payables on previously settled items are not recalculated, the Ending Date should be the day prior to calculating commissions using Net•Yield. To insure that all prior invoices are marked as not having a commission calculated, set the Collected Sales Only setting to N (N=no) in Sales Rep and the Collected Sales Only (Y/N) setting to N (N=no) in Broker. The journal entry that will be created through this process must be deleted in Post Batches.

Select Return to return to the window displaying sales rep or broker summary information without updating any changes and processing the earned commissions.