> ## Documentation Index
> Fetch the complete documentation index at: https://docs.arcuserp.com/llms.txt
> Use this file to discover all available pages before exploring further.

# Sales Commission and Attribution

> Capture sales-agent attribution on orders, generate sales-by-agent reports, and compute commissions. Current state and roadmap for commission engine.

<Note>
  Arcus captures sales-agent attribution (who closed the sale) on every order. Commission tiers and automated calculation are currently a roadmap item. This guide explains what's available today and how to compute commissions using the Sales-by-Agent report.
</Note>

## What is captured

Every order in Arcus includes a **Sales Agent** field that tracks who originated or closed the sale. This field is used for:

* **Attribution reporting:** Know which rep is responsible for each sale.
* **Performance metrics:** Track revenue per sales agent.
* **Commission basis:** Manually compute commissions from the exported report.

## Setting sales-agent attribution on an order

### During order creation

When creating a new order, the system prompts you to assign a sales agent:

1. Click **Create Order**.
2. Search for the customer.
3. In the **Sales Agent** field, search for the sales rep by name.
4. Select the rep from the dropdown.
5. Complete the order as normal.

**Expected result:** The order is stamped with the sales agent's ID. Reports will attribute the sale to this rep.

***

### Changing the sales agent after order creation

If the rep who closed the deal changes:

1. Open the order.
2. Click **Edit Order** or the pencil icon next to the Sales Agent field.
3. Select a different sales agent.
4. Click **Save**.

**Expected result:** The order is reassigned to the new rep. Reports will reflect the change.

***

### Bulk assign sales agents

If you have a large list of orders that need agent assignment:

1. Click **Orders** > **Bulk Actions** (if available).
2. Select multiple orders using checkboxes.
3. Click **Assign Sales Agent**.
4. Select the agent.
5. Click **Apply**.

**Expected result:** All selected orders are assigned to the rep. If you have a CSV with order numbers and agent names, contact your admin about bulk import.

***

## Generating the sales-by-agent report

The **Sales-by-Agent Report** is the current way to track commission basis.

### Step 1: Access the report

1. Click **Reports** in the main navigation.
2. Scroll to find **Sales-by-Agent** (or search for "Sales by Agent").
3. Click the report.

***

### Step 2: Configure the report parameters

1. **Date range:** Select "This Month", "Last Month", "Custom Range", etc.
2. **Sales Agent filter (optional):** Choose a specific rep or leave blank to see all.
3. **Customer filter (optional):** Narrow to specific customers if needed.
4. **Report type:** Select "Summary" (totals per agent) or "Detail" (all orders per agent).
5. Click **Run Report** or **Generate**.

***

### Step 3: Review the report

The report displays:

| Column              | Meaning                                        |
| ------------------- | ---------------------------------------------- |
| **Sales Agent**     | Name of the rep                                |
| **Orders**          | Count of orders attributed to the rep          |
| **Gross Sales**     | Total order amount (before returns, discounts) |
| **Returns**         | Value of returned items (negative)             |
| **Net Sales**       | Gross Sales minus Returns                      |
| **Discount Amount** | Total discounts applied to their orders        |
| **Taxable Sales**   | Sales subject to sales tax                     |

***

## Computing commissions (current manual process)

Since an automated commission engine is not yet available, commissions are calculated manually using the exported report.

### Step 1: Export the report

1. From the Sales-by-Agent Report, click **Export** or **Download as CSV**.
2. Open the CSV in Excel or Google Sheets.

***

### Step 2: Determine your commission structure

Common commission structures for distributors:

**Structure A: Percentage of Net Sales**

* Rep gets 2-5% of Net Sales (after returns, before tax).
* Example: Net Sales $50,000 x 3% = $1,500 commission.

**Structure B: Tiered percentage (volume incentive)**

* Rep gets 2% on first $50K, 3% on $50K-$100K, 4% above $100K.
* Example: $60,000 net sales = ($50K x 2%) + ($10K x 3%) = $1,300 commission.

**Structure C: Commission minus chargebacks**

* Rep gets 3% of net sales, minus any dispute losses or bad debts.
* Example: Net Sales $50,000 x 3% = $1,500, minus $200 chargeback dispute = $1,300 commission.

**Structure D: Gross profit-based**

* Rep gets a percentage of gross margin (not revenue).
* Requires a separate margin report (contact your accountant).

***

### Step 3: Apply your formula in the spreadsheet

Create a new column in the exported CSV:

**Column: Commission**

* Formula (for 3% on net sales): `=NetSales * 0.03`
* Or (for tiered): `=IF(NetSales<=50000, NetSales*0.02, IF(NetSales<=100000, 50000*0.02 + (NetSales-50000)*0.03, 50000*0.02 + 50000*0.03 + (NetSales-100000)*0.04))`

***

### Step 4: Review and approve

1. Check the math. Do totals make sense?
2. Have your sales manager review for accuracy.
3. Adjust any reps who had disputes, refunds, or special deals.

***

### Step 5: Process commission payments

Once you've computed commissions:

1. **Record as expense:** In Arcus Accounting, record commission as an Expense account (e.g., "Sales Commission Expense").
2. **Pay the rep:** Via paycheck, wire transfer, or check.
3. **Document in Arcus:** Add a note linking the commission to the report period and the sales rep.

**GL Entry:**

* Debit: Sales Commission Expense (P\&L)
* Credit: Accrued Commission Payable or Cash (balance sheet)

***

## Current limitations

The current implementation has these constraints:

* **No automated commission calculation:** Commissions are computed manually from the exported report.
* **No commission tiers:** You define tiers in your spreadsheet; Arcus does not enforce them.
* **No dispute integration:** If a rep's sale is later disputed, you manually adjust their commission.
* **No recurring commission:** Subscriptions or multi-month contracts are attributed to the rep in the month the sale closed; subsequent revenue is not re-attributed.
* **No sales agent hierarchy:** You cannot track "who supervises which rep" for manager commissions.

***

## Best practices for commission accuracy

* **Verify agent assignment:** Spot-check 10-20 orders each month to ensure the right rep is assigned.
* **Document exceptions:** If a rep doesn't get credit for a sale they made, document why.
* **Review large sales:** For any sale over a threshold (e.g., \$10K), verify the rep's assignment before commission is paid.
* **Account for returns:** If a customer returns items, subtract the return value from the rep's gross sales.
* **Chargeback policy:** Decide whether the rep's commission is reduced if their sale is later disputed. Document the policy.

***

## Roadmap: Automated commission engine (future)

In future releases, Arcus plans to add:

* **Commission tier configuration:** Define tiers per entity (2% on first \$50K, 3% above).
* **Automated commission calculation:** System computes commissions automatically at period close.
* **Commission accrual:** GL entries automatically accrue commission expense as sales are recorded.
* **Exception handling:** Configure chargeback offsets, refund deductions, and dispute adjustments.
* **Multi-level commission:** Support manager commissions (% of team commissions).
* **Commission reports:** Built-in commission detail and payment reports.

**Timeline:** TBD. Contact your account manager for the latest roadmap.

***

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