Balancing Deposits and Distributions

Modified on Wed, 03 Aug 2022 at 03:57 PM

Best Practice Suggestion: A Balance should be struck every day but can be done weekly or monthly. This document describes the steps using the SMI Reports available in Tax Client and Report Manager. This tutorial divides the process into five steps:


  1. Check for open batches
  2. Reconcile the Deposit Summary to the Deposit
  3. Document Strike Offs & Refunds
  4. Reconcile the Deposit Summary to the Detail Collection Summary
  5. Reconcile the Detail Collection Summary to the Distribution Reports


Other useful reports

Overpay Refunds

Distribution Summary

Attorney Distribution Summary

Rendition Summary Report


Step 1: Check for Open Batches

This is the time to check the status of the batches to be gathered for the required period's business. For the purposes of striking a balance, only closed batches are considered. Run a Deposit Summary set for the date range required, Open Batches, and select all batch types. 



The report will list ALL Open batches. ***** These need to be resolved *****

If they are to be included in the balance they will need to be closed. This is a good method to catch a batch that has accidentally been left open if someone had to leave for the day or was interrupted as they closed out for the day.


Important: Open batches should, normally, have a deposit date of 01/01/9999 and when closed their deposit date will be modified to today's date. The example below does show some Open batches where a user has manually set a deposit date. This is not recommended as the date will be overwritten when the batch is closed and may appear confusing.


Part A will order the batches by Clerk/Date and categorizes by tender; Cash, Check, Credit or by Stroke Off, Other and Refund.





Part B will order the batches by Clerk/Date and categorize by Receivable; Levy, Penalty, Interest, Atty Fees etc.



Use the Tax Client Batch reports to reconcile an open batch. The UnPay feature is much less complicated for error repair than reversals after a batch is closed. Closing a batch automatically sets the Deposit Date. It is this Deposit Date that is considered when setting the parameters for the reports. A date range is requested as a selection parameter. The user fills in the From and To dates for the report. The report reflects all closed batches in the date range at run time. The “run” date and time are included on each report. If a report is run, then a batch is closed, it will not reflect the batch. However, if the same date range is run a second time, but at a later date, the amounts will not match, because it will pick up all closed batches in the date range at the new run time. The batch that was closed after the first run will now appear on the second run and will be included in the totals.




Step 2. Reconcile the Deposit Summary to the Deposit

 

Run three individual Deposit Summaries. The first will include Cash/Check. Credit Cards and other payment batch types. Set the parameters for the same date range, Closed Batch Status, but adjust the Batch Types for each of the reports.

 

Cash, Checks, and Credit Card and other payment types

These settings will give a listing of the Cash, Checks, and Credit Card batches in the date range that have been closed. 

Please, remember to select all types that reflect incoming payments.

These are the original payments and will not reflect any later adjustments.





Reversal

These settings will give a listing of all Reversal batches in the date range for closed batches. When posting to a Reversal Batch, do not mix Reversals that will be reapplied (i.e.: payments made on the wrong account, or payments made for the wrong amount) and Reversals that will not be reapplied (i.e.: NSF Checks). Using a Reapply batch will make this much clearer. Keep them in separate batches, and note the batch numbers. This will make it much easier to document for an auditor. On some occasions, like this date range, there may be no closed reversals.

 



Reapply

This final setting will give a listing for all Reapply Batches in the date range for closed batches.

Reversals that are reapplied for the same amount are now reversed and reapplied in the same batch, so that instead of two batches that when summed would equal zero, now one batch will have a zero total, since the Reversals and Reapplies are posted together. Do both the Reversal and Reapply on an account at the same time to keep the entries in order.

The UnPay feature can be used before the batch is closed to catch most typos and misapplies. However, if the batch has been closed and the deposit doesn’t match the report, a typo may be discovered. When explaining something like a payment that has been made for the wrong amount where the reversal will not be for the same amount as the Reapply, this will make tracking the event much easier. 



Once the reports have been run, compare the numbers this way:

 



Documentation for the Reversals with No Reapply can be found in TaxClient. It is a good idea to note the batch numbers. The Batch Manager Reports can be filtered on a specific user’s batch.




Step 3. Document Strike Offs and Refunds

The Deposit Summary run for the required date range, closed batches, all batch types will provide these numbers. The Cash, Check, and Credit Cards have been proved out along with the deposit for the day.


Strike Offs can be verified by running Balancing Reports: Strike Offs / Balance Adjustment by Unit or Year/Unit


Refunds can be OverPay or Recalc. Overpay being the result of too much money being applied to the account. Recalc. are created when the Levy is adjusted down or when exemptions are increased or when new exemptions are added to the account.


To verify the refunds add together the totals from the Refunds Paid and Refunds Void reports.


Step 4. Reconcile the Deposit Summary to the Detail Collection Summary

 

The Detail Collection Summary breaks out all the receivable types by Tax Unit, their current and delinquent status, then  M&O, I&S, and Special Funds. It represents the same data as the Deposit Summary, except that it does not include Strike Offs and Balance Adjustments. To reconcile the Detail Collection Summary to the Deposit Summary, start with the grand total from the Deposit Summary. Subtract the Strike Off and Balance Adjustments. This total should match the Detail Collection Summary Grand Total. 






Step 5. Reconcile the Detail Collection Summary to the Distribution Reports

Once the money is collected, the collecting entity must then disburse it to the appropriate parties. Add the following for a full disbursement of the collections:

Disbursements to the jurisdictions the collecting entity represents (includes Recalc.refunds)

Disbursements to the collecting attorneys (collection fees)

Disbursements to the appraisal district (rendition penalty admin fees)

Overpay Refunds in the process of being disbursed to Tax Payers

These must match the Detail Collection Summary. 




Overpay Refunds are calculated with a combination of three reports. To calculate to the disbursement amount use the following:


Grand Total Overpay Refund Only for Each: Refunds Collected Report – Refunds Paid Report – Refunds Void Report



 Important reports


Distribution Summary 

The Distribution Summary details all the money distributed to each jurisdiction that the collecting entity represents. 

 

 

Attorney Distribution Summary

The Attorney Distribution Summary details only those accounts that have Collection Fees calculated. There is a summary and a detail report. The Collection Fees Paid column details the amount to be paid to the collecting attorney.

 


Rendition Summary

The Rendition Summary Report details the Rendition Penalty data. This is a net report and does take into account recalculations on accounts. The report shows current and delinquent totals for each entity on the penalty on the Rendition Penalty, the interest on the Rendition Penalty, the Rendition Penalty itself, and the Rendition Penalty Admin Fee. 


 


$117.57 was paid to the appraisal district. Current (4.66) and Del (112.91) show as negative numbers. In the Distribution summary, the total Rendition Penalty is shown and the Rendition Penalty Admin Fee is subtracted as it does not go to the jurisdiction. This way the reports give full accounting but pay the correct parties. This report shows the admin fee in the same manner for consistency. Please remember that this is a net number. If a Recalculation happens, and there are more Recalc Rendition Penalty Admin Fees, the signs can reverse. 

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