Accounting

This is where we will show you how to reconcile your accounting numbers using the tools available to you in Infinity.

 

The very first step in accounting is understanding the two accounting methods: Cash Basis Accounting, and Accrual Basis Accounting.

• Cash Accounting: Income is counted when cash (or a check) is actually received, and expenses are counted when actually paid.
  
• Accrual Basis Accounting:  Income is counted when the sale occurs, and expenses are counted when you receive goods or services. You don't have to wait until you see the money or until you actually pay money out of your checking account.
  

Reports You Will Need To Reconcile Your Books:

The first report is the Daily Recap Report.  This report provides important information about your daily,monthly, quarterly or yearly (or all) financial activity.  The purpose of this report is to see the overview of “what happened today” in your business. This information could include: number of payments taken, the number of payments that have been reversed or how many loaned have been issued or written off.

Another key report for accounting is your Portfolio Report.  The Portfolio Report is a non-customizable report which allows you to see the “flow” of funds for each loan product your business offers.  The Portfolio Report uses to kinds of data: Loan state data and events data.  The Loan state data includes snapshots of your loans throughout their history.  This means the report tracks when a loan was active, when/ if it became past due, when a loan was paid off/written off and what the total “amount” was at various points in time.  Loan Events include the payments, fees, and new loans.

 

Finally, you should consult Infinity's Payments Report which will itemize your ACH payments.  This is a customizable report that you can pull all of your “Pending Payment settlement Status” payments that have been made via ACH.  This is something you can add in your business rules for adding this temporary loan status to your customers when they make an ACH payment.  This will allow you to see what payments that have actually posted and ones that have not yet posted. 

 

The Reconciliation Process:

This section of documentation will outline where the numbers in the Daily Recap Report, the Portfolio Report and the Payments Report are coming from.  This will require payment details, adjustments, as well as "up-loans" and "re-loans". 

 

Here is our documentation on reconciling our accounting reports. These pages will provide you with step-by-step instructions on how to balance your books by comparing a series of reports:

• Reconciling the Daily Recap Report Balancing this report will help you to understand your company's financial activity. So, how many loans you have issued or reversed, for example.
  
• Reconciling the Drawer Operations Report Balancing this report will allow you to balance your cash drawers in one or many store locations. If you do not handle cash transactions, this process is not applicable to you.
  
• Reconciling the Outstanding Loans Report If you are interested in balancing your collections activities, this documentation page will walk you through balancing the income from past due loans.
  
• Reconciling the Past Due Payments Report : If you are interested in balancing the income generated from payments made on past due loans, this documentation page will lead you through the steps to focus the accounting aspect of your collection efforts.
  
• Reconciling the Portfolio Report : If you would like to verify that the information in the Portfolio report (which shows the "flow" of funds in your company, follow the steps outlined in this document.
  

Infinity's reporting engine is DYNAMIC, not static. This means figures are consistently changing according to what is happening in real time.  In order for you to have Infinity's reports work as if they were truly "static" is to manually run the reports listed above at a set time every day.  Infinity allows you to either print this information directly or to export it as a CSV file.

It is important your company creates a process of how they get the details for reconciling.

 

You can create a custom report to pull the specific data set for which you are looking.

 

Here are some suggestions for filters and columns you may consider including in a custom accounting report:

 

Filters:	Columns:
Amount Due Amount Paid Bankruptcy (Yes/No) Pending Payment Settlement Status Days Since Last Payment First/Last ACH Return Date Loan Amount Loan Status Missed First Payment Past Due Days Payment Hold Payment Plan Principal Due Principal Paid	Name Loan Amount Funded Amount Interest on Due Date Total on Due Date Principal Due Interest Due Fees Due Total Due Due Date or Original Due Date First/Last NSF Fee Date First/Last ACH Return Date Number of Payments Last Payment Days Late Total Paid

 

A complete glossary of our available report filters and columns can be found HERE.

 

Calculation Variances:

Depending on how you have set up Infinity to calculate reversed payments, you may have what is known as a "calculation variance."

To determine how your Infinity calculates reversed payments, go to the Settings page and select the Corporate Settings link in the top left of the screen. Next, scroll to the very bottom of the page, to the "Recalculate Payment Reverses" checkbox.

 

 

If this checkbox is checked: when a customer’s payment is reversed out of the customer’s account the system acts as if the payment never happened in the loan history and therefore, a higher principal balance is available to calculate interest and fees. 

If the checkbox is not checked when a customer's payment is reversed, Infinity shows the payment being reversed out of the loan history and acts as if the payment was posted and then returned.  This means the interest, fees and principal will reflect a lesser amount until the payment is actually reversed.

There is no recommended method: whether you check the box or not, this is truly the lenders preference on how they want the loan to recalculate the reverses. 

Perform Daily Data Backups:

The last part of this section has to do with your company’s backups. 

Infinity has a daily export feature housed in its Corporate Settings called Daily FTP export which allows you to export a daily report to your sererwhich includes to –date customer and loan data.  If you are interested in this feature of the software, you will need to have FTP capabilities and a server to which to export your data.  If you would like Infinity to house this data, we have the capability to do this feature for you for your backups as well. 

 

Chart of Accounts Report:

We are currently working on creating a customizable detailed report modified by assigning account numbers to various sources of income and expense by grouping.  This will be known as a Chart of Accounts report in Infinity.  This report will also have the ability to be exported to CSV to be used for your Accounting software.