Transaction Type Codes

The following codes should be used when posting a Member Account Adjustment.

Share Account Types

82

Credit Balance Only

Credits (raises) the member's account balance.

Example: A member's account was charged $20.00 in NSF fees on June 6. After a lengthy story about the woes of his checking account, the member convinces the MSR that he should only be responsible for half of the fee. The MSR credits the member's account $10.00 using code 82, which raises the member's balance and debits the GL income account designated by the GL Offset. No other information is updated.

 

 

 

83

Credit Balance & Adjust YTD Div

Credits (raises) the member's account balance by paying dividends directly to the member from an expense account, increasing the year-to-date dividend bucket without affecting accrued dividends.

Example: Member John Smith's funds were accidentally deposited into Mary Jones' account on May 27. The balance on which dividends were calculated from May 27 to May 31 was incorrect, and therefore Mr. Smith was shorted dividends on May 31. Mr. Smith brought this to the credit union's attention on June 3, and the MSR calculated that the member was owed $17.84 for the four-day period. The MSR simply paid the dividend directly to the member by posting a $17.84 adjustment using code 83. The $17.84 was expensed to the share dividend application's expense GL, designated by the GL Offset. This increased the member's balance and increased the YTD dividends bucket so that the proper amount of dividends would be reported to the IRS.

 

 

 

84

Credit Balance (Post Dividends)

Credits (raises) the member's balance by paying accrued dividends, lowering the accrued dividend bucket and increasing YTD dividends.

Unlike code 83, the expense of the dividend has already been accounted for through normal daily processing, and the adjustment is being used simply to pay the dividend early.

Example: A member was angry because of poor service and wanted to close his account after having a run-in with the checking department over an NSF fee. The MSR decided to reverse the fee and pay the member the accrued dividends and close the account. Both of these transactions can now be accomplished through Account Adjustment rather than having to do an adjustment for the NSF fee and then force-pay dividends through the separate tool.

On line 1, the MSR uses a code 82 to increase the member's balance for the NSF fee of $10.00 and offsets it against the income account for NSF fees, designated by the GL Offset. On line 2, the MSR would pay the accrued dividends using code 84, which would increase the member's balance, lower the accrued dividend bucket, and increase the YTD dividend bucket by the amount of the outstanding accrued dividends. The credit would be offset by a debit to the share dividend application's accrual GL, designated by the GL Offset.

·     This code is simply an alternative to posting dividends on demand through the separate tool (part of the Close Memberships/Accounts options), or waiting until the end of the month for dividends to be paid automatically.

 

 

 

92

Debit Balance Only

Debits (lowers) the member's account balance.

Example: In a previous month, a deposit intended for checking account 1324-001 was accidentally posted into account 1234-001. Since month-end has passed, the MSR cannot perform an auto reversal. To remove the money from the 1234 account, the MSR would use code 92 to lower the balance for the deposit amount. The offsetting credit would be posted against a suspense account (such as the 870-00 suspense) designated by the GL Offset. Later, the MSR would use code 82 to credit the correct account 1324 using the same GL offset.

 

 

 

93

Debit Balance & Adjust YTD Div

Debits (lowers) the member's account balance by taking paid dividends away, decreasing the year-to-date dividend bucket without affecting accrued dividends. The debit is offset against an expense account.

Example: On May 27, Member John Smith's funds were accidentally deposited into Mary Jones' account. Consequently, Mary Jones was paid more dividends than she was owed because her balance was incorrect from May 27 to May 31. After posting the adjustment to Mr. Smith's account (described under code 83 above), the MSR would post an adjustment to Ms. Jones' account for $17.84 using code 93, which would lower both her balance and her YTD dividends, since the dividends were paid in error. This debit would be offset by a credit to the share dividend application's expense GL, designated by the GL Offset.

94

Debit Balance (Unpost Dividends)

Debits (lowers) the member's balance by removing paid dividends and returning them to the accrued dividend bucket to be paid at a later time through the normal dividend processing. The debit is offset by a credit to the accrual GL account. The actual dividend payment will come through the normal process.

Example: This is a rare case. A new employee inadvertently posted dividends through the manual posting option to several member accounts for a new sub-share type. The employee needs to reverse the dividend posting and reset the accrued buckets so that the dividends can be paid through the proper end-of-month procedure. The employee would post each dividend reversal by using code 94, which would lower the member's balance, increase the accrued bucket, and lower the YTD dividends bucket by the amount of the dividend. The debit would be offset by a credit to the share dividend application's accrual GL, designated by the GL Offset. The dividends would be re-posted through the normal end-of-month processing. In this case, the employee would probably block the original and adjusting transactions from the member’s statement. (See Blocking Transactions from Appearing on Member Statements for details.)

 

Loan Account Types

 

82

Credit Balance Only

Credits (lowers) the member’s loan balance but does not affect the maintenance items such as annual interest, payment due date, or delinquency status.

Use the Interest field to adjust the accrued interest amount. The difference between Amount and Interest will be credited to principal.

Example: A member called in for a payoff on her loan and was quoted an amount of $1,015.50 based on her payment arriving on Friday, May 28. However, the mail did not arrive until June 3, and the actual payoff at that time was $1,018.75 due to interest accruing over the weekend). Before posting the payment, the MSR adjusts the interest due so that the payment will bring the loan to a zero balance, using code 82 and entering $3.25 as both the transaction Amount and the Interest to be credited. This would lower the member’s interest due without changing the balance, and would have no effect on any other loan information. The offsetting debit would be against the loan income account, designated by the GL Offset.

 

 

 

83

Credit Balance & Adjust Govt Int

Credits (lowers) the member’s loan balance, decreasing student loan government interest totals. Remember that the Int Due verification fields shown on the screen represent member interest due, not government interest, regardless of the tran code being used. Be sure to view Inquiry after making this type of adjustment to verify the government interest amount. (Also see *NOTE below.)

Use the Interest field to adjust the accrued government interest amount. The difference between Amount and Interest will be credited to principal.

Example: On June 6, the student loan coordinator finds that a student loan’s deferment should have ended on April 30, 1999. The loan has been accruing to the government interest bucket in error since April 30. The total incorrect interest comes to $18.30. The loan coordinator would correct the loan using code 83, entering $18.30 as both the transaction Amount and the Interest to be credited. This would lower the member’s outstanding government interest due and have no effect on the member’s balance or any other loan information. The offsetting debit would be against the government income account, designated by the GL Offset.

·     The only difference between codes 82 and 83 is which interest due bucket is affected: With code 82, the member’s interest due is adjusted; with code 83, the government interest due is adjusted.

*NOTE: Remember that Account Transaction History screens always show member interest, not government interest, even on student loans. Be sure to take that into account when viewing transaction history after an adjustment has been made to government interest (using codes 83 or 93).

Transaction History Sample

Notice that the balance did not decrease by a full $100.00 after this adjustment. The difference was credited to government interest (not shown here).

images\trantypecodes-historysample_shg.gif

85

Credit / Post Payment

 

Credits (lowers) the member’s loan balance and affects maintenance items as if a normal payment was being made. Corrects annual interest, moves payment date ahead by affecting the Partial Payment field, and changes delinquency status.

Use the Interest field to adjust the accrued interest amount. The difference between Amount and Interest will be credited to principal.

Example: On May 13, a payment for loan 332-786 was posted to account 632-786 in error. Therefore, since May 13, loan 332-786 has been accruing interest on the incorrect principal balance. The loan payment needs to be adjusted and the member’s outstanding interest needs to be corrected.

Loan 332-786 has a balance of $1,000.00 and has been accruing since May 13 at daily per diem of $1.85. If the member’s payment had been posted correctly on May 13, the balance would have been $935.00, and the daily accrual would have been $1.55. Using the Div/Int Calculator, the loan officer determines that for the period of May 13 to June 6, the member needs an interest correction of 24 days at $0.30 per day, for a total correction of $7.20.

To correct the situation, two adjustments must be posted. On line 1, the loan officer uses code 85 to post the May 13 payment of $139.55, with an Interest amount of $74.55. This would lower the principal by $65.00 ($139.55 - 74.55) and lower the interest due bucket by $74.55. It would also advance the next payment due date based on the payment being received, and increase the YTD interest paid by $74.55. The offsetting debit would be against a suspense GL account (such as 870-00), designated by the GL Offset.

The second correction would be to lower the resulting outstanding interest due by $7.20 ($0.30 x 24). On line 2, the loan officer enters code 82 (described in more detail above) with the Amount and Interest equal to $7.20. The offsetting debit would be against the loan interest income G/L account, designated by the GL Offset.

·     See the example outlined under code 95 below for the separate adjustment required to correct account 632-786 and clear the suspense GL account.

 

 

 

92

Debit Balance Only

Debits (raises) the member’s loan balance but does not affect maintenance items such as annual interest, payment due date, or delinquency status.

Use the Interest field to adjust the accrued interest amount. The difference between Amount and Interest will be debited to principal.

Example: A member’s credit life insurance was not set up in time to have the account debited by the automated process at the beginning of the month. To post the May insurance premium on June 5, the loan officer would post an adjustment for the premium Amount of $5.85 using code 92. There would be no interest adjustment, so the Interest amount would be zero. This code would raise the member’s balance and have no other effect on the loan. The offsetting credit would be against the insurance payable GL, designated by the GL Offset.

 

 

 

93

Debit Balance & Adjust Govt Int

Debits (raises) the member’s loan balance, increasing student loan government interest totals. Remember that the Int Due verification fields shown on the screen represent member interest due, not government interest, regardless of the tran code being used. Be sure to view Inquiry after making this type of adjustment to verify the government interest amount. (See the *NOTE above.)

Use the Interest field to adjust the accrued government interest amount. The difference between Amount and Interest will be debited to principal.

Example: On June 6, the student loan coordinator finds that a member’s student loan was put on the system at a rate of 8.75% and it should have been set to 9.25%. The system has been accruing interest to the government bucket at the wrong rate for 32 days, totaling $12.85. The coordinator would add the $12.85 to the government bucket using code 93, entering $12.85 as both the transaction Amount and the Interest to be debited. This would raise the member’s outstanding government interest due and have no effect on the member’s balance or any other loan information. The offsetting credit would be against the government income account, designated by the GL Offset.

·     The only difference between codes 92 and 93 is which interest due bucket is affected: With code 92, the member’s interest due is adjusted; with code 93, the government interest due is adjusted.

 

 

 

95

Debit / Reverse Payment

Debits (raises) the member’s loan balance and affects the maintenance items that are changed when a normal payment is made. Corrects annual interest, moves payment date back, and changes delinquency status.

Use the Interest field to adjust the accrued interest amount. The difference between Amount and Interest will be debited to principal.

Example: On May 13, a payment of $139.55 intended for loan 332-786 was posted to account 632-786 in error and the payment needs to be reversed from account 632-786. The payment resulted in an interest payment of $57.00, and since May 13 interest on this loan has been under-accruing due to the lowered principal balance.

Because the payment was made in error by the credit union, the loan officer decides not to raise the interest for account 632-786, but rather to simply recover the funds from the other member’s account. Using code 95, the loan officer would post a debit of $139.55 with an Interest amount of $57.00. This would result in the principal being raised by $82.55 ($139.55 - 57.00) and the interest due bucket being raised by $57.00. This would also reset the next payment due date back to the previous due date prior to the May 13 payment being posted, and lower the YTD interest paid bucket. The offsetting credit would be against a suspense G/L account (such as the 870-00 suspense), designated by the G/L Offset. See the example outlined under code 85 above for the adjustment required to correct account 332-786 and clear the suspense account.

HINT: If the CU did decide to charge 632-786 for the extra interest that should have accrued, the loan officer would use the Div/Int Calculator to determine the amount, then post an adjustment using code 92, entering the calculated figure as both the Amount and the Interest amount, with an offsetting credit to the loan interest income G/L account, designated by the GL Offset.

  • HINT: Be careful when using this code to reverse a loan payment that was originally applied to principal only.  Remember that a principal-only payment generally does not move the payment due date forward.  If you reverse a principal-only payment with this code, make sure to double-check the loan’s due date after the adjustment is posted.

 

 

 

Link to ID: https://help.cubase.org/cubase/cubase.htm#Transaction_Type_Codes.htm