Late Fees

A late fee is a finance charge Arcus adds to an overdue invoice. Use Late Fees to turn the feature on, choose how the fee is worked out, and decide which invoices qualify. When a fee is assessed, Arcus creates its own invoice for the customer and posts it to your books.

​

Before You Start

• You need the settings.view permission to open the page.
• You need settings.edit to save. Save Late Fee Settings is shown to every role that can open the page, but the server refuses the save for a role without settings.edit.
• Late fees are off until you turn on Enable Late Fees. While it is off, no late fees are assessed, whether automatic or by hand.
• Check the rules for finance charges where you do business. The page reminds you that maximum finance charge rates vary by state and that Arcus does not provide legal advice.

​

Open Late Fees

1. In the deck, open Settings.
2. Under Payments & Checks, choose Late Fees.

The breadcrumb reads Settings > Payments & Checks > Late Fees. The AR & Invoicing page links here with Go to Payments > Late Fees, and you can also search for Late Fees in the command palette.

​

Settings

Change the fields you need, then click Save Late Fee Settings once. All fields save together, and Arcus shows “Late fee settings saved”.

​

Enable Late Fees

The master switch. When it is off nothing is assessed.

​

Rate and timing

​

Compounding method

For example, 18 percent a year monthly on a $1,000.00 balance is$15.00. With Maximum Fee Per Cycle at $10.00, the fee is$10.00. A flat fee of $25.00 charges$25.00 no matter the balance or the rate.

​

Tax and notifications

• Finance Charges Are Taxable: when on, Arcus asks AvaTax to calculate sales tax on the fee. It needs your AvaTax connection to be active, and whether finance charges are taxable depends on the jurisdiction. When tax cannot be calculated, the fee is still posted without tax.
• Email Customer on Assessment: when on (the default), Arcus emails the customer the Late Fee Assessed message each time a fee posts.

​

What Makes An Invoice Eligible

An invoice is assessed only when all of these hold. Otherwise Arcus skips it and says why.

• Late fees are enabled, and a flat fee or a rate is set.
• The document is an invoice or a sales order that has been invoiced, and it is not paid, voided, a draft, or not yet invoiced. A cancelled, archived, or expired order is skipped too.
• The customer is not exempt. Mark a customer exempt with Finance Charge Exemption on the customer’s account page.
• The invoice has a due date and is past the grace period.
• The balance is at or above Minimum Invoice Balance.
• Goods billed on the invoice have shipped. Arcus does not charge a fee on an invoice for goods that were billed but not yet shipped.
• The invoice was not already assessed today.
• The computed fee is above $0.

​

How Fees Are Assessed

Every day Arcus checks each company that has late fees on. With Monthly compounding it assesses only on the Assessment Day of Month. You can also run an assessment by hand from Assess Late Fees in AR Management, which previews each fee before anything is charged. Each assessed fee:

• Creates its own late fee invoice for the customer, linked to the overdue invoice.
• Posts a journal entry that debits Accounts Receivable and credits Finance Charge Income.
• Adds tax when Finance Charges Are Taxable is on and tax can be calculated.
• Emails the customer when Email Customer on Assessment is on.

​

Messages You May See

A red message above the button shows the first problem and nothing is saved until you fix it.

​

What Changes Elsewhere

• Invoices and AR: each fee is a new invoice on the customer’s account, so it shows in aging and on the customer’s open invoices like any other.
• Accounting: each fee posts a journal entry to Accounts Receivable and Finance Charge Income. If a fee posts without tax that you wanted, void the fee invoice and assess again.
• Customer email: the Late Fee Assessed email goes out when notifications are on.
• Tax: with taxable fees on, AvaTax is called for each fee.
• Audit trail: each save is recorded in the Audit Log with the old and new values, and each fee is recorded when it is assessed.
• Other open sessions: when another administrator saves a change here, your page refreshes to show it.

​

Related Articles