PATRONAGE REFUND PROCEDURES - detailed instructions

PATRONAGE REFUND PROCEDURES – DETAIL

These procedures are general guidelines only, as each situation can be different. If you have other questions or need things clarified, please call customer support at 800-366-2474 or e-mail mysupport@agris.com

Step 1. Verify

If you accumulate activity each month as you progress through the year be sure that if you add a new product category that is not a part of an existing recap category that you set up the new patronage code. If you have the patronage codes set up by location, you will have to add the patronage codes for the new location before accumulating the activity for the period.

Step 2. Verify Patronage Codes & Names

If you accumulate activity at the end of the fiscal, review the following for any changes.

a.      Has a new location been added?
b.      Have any new product categories been added?
c.      Has any new commodity codes or discount codes been added?
d.     If yes to any of these questions, please review the patronage code set up and add any that are necessary. See Step 3 below for how to add a patronage code.
e.      Are the flags in Name/Address correct for the patrons? If not, make the necessary corrections. For example, member/non-member or Voting/Non-voting. Be sure for all name ids the question “Accumulate Patronage” on the General Information screen is answered with a Y or W. The W indicates that there is not a social security/federal id number, or the patron is subject to backup withholding.
f.       In Name/Address on the Relationship screen you can set up Patronage Split information for those accounts whose activity needs to go to another name id(s), such as partnerships or if a patron has multiple accounts and you want all of his activity under one account.

Step 3. Add New Patronage Codes

To add a patronage code, go to Patronage

a. Select Patronage Codes from the menu and then chose View/Edit Patronage Codes.
b. Click on the insert button, the following screen appears.

c. For inventory activity type in an S for Purchase/Sales and for the Accounting type use 1.
d. For commodity activity type in a P for Purchase/Sales,
use accounting type 2 – 4 for grain activity,
which are explained below and 5 is used for discounts.

i. Activity type 2 – Commodity Received.
This is for grain delivered by the patron and is accumulated based on the delivery sheet date.

ii. Activity type 3 – Commodity Purchase/Sold.
This is for grain that has been applied to a contract and/or settled.
The activity is accumulated based on the latest date of application to the
contract or date of delivery sheet.

iii. Activity type 4 – Commodity Settled.
This is for grain settled and is accumulated based on the settlement date & payment
name ID. Recommended Method.

e. The next portion on the screen is where you will add the product category, commodity code or discount code. Remember to remove the location code if you are not paying different rates by location.
Suggestion: if your company does direct ships through a unique location, this allows you to exclude that location from patronage. This means you would setup commodities and discounts by location but could still have your inventory sales encompass all locations by leaving this blank.

Step 4. Accumulate Activity

a. To accumulate activity chose the Process Activity menu option and then
the Accumulate Activity menu option
b. The following screen will appear.

c. Put in the date range for which you want to accumulate the activity. We recommend that you accumulate by month regardless if you wait until the end of the fiscal year to accumulate.

Step 5: Balance the Accumulation

Balance the accumulation to ledger, inventory management and/or commodity accounting. The inventory activity will be balanced to the respective product category sales in inventory management or to the sales on the financial reports.

a. Reports to print

        i.     Ledger – Use the financial statements or trial balance
        ii.      Inventory Management –
Use the inventory activity report Gross Margin Report by Product Category.
You will have to adjust the parameters and change the Transaction Type to be 1 – 1,
change the activity date and if you do not want to see every invoice, on the Subtotal & Other
options screen answer the question “Print Inventory Activity Detail?” no.
a.      For active invoice transactions
                                 i.      Transaction type - 1 - 1 (invoices only)
                                ii.      Activity Date - match the patronage accumulation period
                              iii.      Record Type - C to C (customers only)
iv. Blank out reverse dates. You need to see everything keyed in the time period.
                 b.      For voided invoice transactions
                                 i.      Transaction type - 1 - 1 (invoices only)
                                ii.      Activity Date - Blank to ending date of patronage accumulation period
Example: Activity Date = blank to 2/28/22
                               iii.      Reverse Date - Beginning Void date to match beginning patronage period
- ending void date to match ending patronage period.
Example: Reverse Date = 2/1/22 to 2/28/22

iii. Commodity Accounting –
The report you will run depends on the accounting type used to accumulate the activity.
Accounting type 2 “Grain Received” –
Use the standard Delivery Sheet Report.
You will need to run the report twice, once for the active delivery sheets and again for the
voided delivery sheets, these amounts will need to be netted together to get the correct
amount. Adjusting the parameters as follows:

a.      For all delivery sheets
                                 i.      Paid Status – P – V
                                ii.      Purchase/Sale – P – P
                              iii.      Application Type – Leave blank
                               iv.      Apply Date – Use the date range of the activity to be balanced

b.      For voided delivery sheets
                                 i.      Paid Status – V – V
                                ii.      Purchase/Sale – P – P
                               iii.      Void date – Use the date range of the activity to be balanced

Accounting type 3 “Grain Purchased/Sold” –
Use the standard Delivery Sheet Report. You will need to run the report twice.
Once for the active delivery sheets and again for the voided delivery sheets.
Net these amounts will need to be netted together for correct amount.
Adjusting the parameters as follows:

a.      All delivery sheets
                            i.      Paid Status – P – V
                            ii.     Purchase/Sale – P – P
                          iii.    Application Type – AA – ZZ
                           iv.   Delivery Sheet Date – Use the date range of the activity to be balanced

b.      For voided delivery sheets
                            i.      Paid Status – V – V
                          ii.      Purchase/Sale – P – P
                         iii.      Application Type – AA – ZZ
                        iv.      Void date – Use the date range of the activity to be balanced

Accounting type 4 “Grain Settled” – Recommended Method
Use the standard Delivery Sheet Report. You will need to run the report twice.
Once for the active delivery sheets and again for the voided delivery sheets.
Net these amounts will need to be netted together for correct amount.
Adjusting the parameters as follows:

a.      Active delivery sheets
                            i.      Paid Status – P – V
                            ii.     Purchase/Sale – P – P
                          iii.    Application Type – AA – ZZ
                           iv.   Settle/Defer/void Date – Use the date range of the activity to be balanced

b.      For voided delivery sheets
                            i.      Paid Status – V – V
                          ii.      Purchase/Sale – P – P
                         iii.      Application Type – AA – ZZ
                        iv.      Settle/Defer/void Date – Use the date range of the activity to be balanced

Report for Settled Grain

Accounting type 5 “Commodity Discounts” –
Use the standard Delivery Sheet Report adjusting the parameters as follows:
a.      Paid Status – P – U
b.      Purchase/Sales – P – P
c.      Settlement Date – Use the date range of the activity to be balanced
d.     On the Additional Options screen adjust the following parameters:
i.      Deduction Status – P – P
ii.      Deduction Type – This is the discount code of the activity
                        iii.      Answer Y to the question “Include Only the Sheets With These Deductions”.

iv. Patronage – Product Activity Report – Summary

b. Monthly versus Yearly Accumulation
If you are accumulating the activity as you progress through the year you can balance each month as
you go along or at the end of the year. If you are accumulating the activity at the end of the fiscal year,
then balance first for the whole year. If there are problems, then balance by the month to find where the
problem is.

Step 6. Compress

After everything is balanced, compress the activity by going to Process Activity and the chose Compress Activity. Be sure to answer Y to “Compress Activity” question. This takes 12-months of activity down to a single line for patronage code. This also updates the activity with the current name id flags, so that the activity inherits the data from name/address.

Step 7. Add Accrual Activity

Now is the time to add any accrual activity that needs to be accounted for (i.e. storage). To determine storage accruals run the Storage Charge process without updating. See the print screen below.
This data can be placed in a Patronage Activity import file or manually keyed through PAT > Account Balance Inquiry > select name > Select 8) Activity History > insert button at bottom of screen.

Step 8: Import of Key 3rd Party Activity

Import or key any 3^rd party activity that needs to be accounted for (i.e. third-party feed/seed sales)
This data can be placed in a Patronage Activity import file or manually keyed through PAT > Account Balance Inquiry > select name > Select 8) Activity History > insert button at bottom of screen.
The import file layout is found in AGRIS > Maintenance > import file layouts > PAT > Patronage Activity
or
Run the standard patronage activity report for report 11. Patronage Activity Export Spreadsheet. This can used as a template for the import file.

Step 9: Transfer Activity

Transfer any activity that needs to be transferred. The system looks at the patronage split information in Name/Address to move the activity. This would be partnership splits to individual names or transfer of activity to heirs of an estate.

Step 10: Auditor Reports

Your auditors may require reports that show member business vs. non-member business. The report to use is the standard activity report Product Activity Report – Summary. Print the report once with all activity and then again adjusting the parameters for only member business using the flags that are set up in Name/Address to control who is eligible to participate in the refund.

Step 11: Key Refund Rates

Put the correct refund rates on the patronage codes. To do this go to Patronage Codes > View/Edit Patronage Codes. Select each patronage code and verify the rate and the rate base.

Step 12: Setup Patron Refund

In Set up Information verify the Patron Refund Information and change what is necessary. This is how much you are paying out in cash, stock, &/or equity.
PAT > Setup > Patronage Refund Setup

Step 13: Print Projected Refund

Print the Projected Refund Summary - by Patron report. Be sure to adjust the parameters to only include those people who are eligible to participate in the refund. An example of this would be the name/address flag for Members only. Review this information to be sure that the patrons included are correct.

Step 14: System Integration

Check the System Integration to be sure that it is turned on for Patronage Refunds so that vouchers will be created in AP
PAT > Setup > System Integration

Step 15: Create Refund

You are now ready to create the Patronage Refund Transactions
PAT > Patronage Transactions > Patronage Refunds

Step 16: Verify Refund Matches Projected Refund

Run the Patronage Transaction report, standard, Patronage Refund Report.
Compare the refund amount to the projected refund amount in the Unrefunded Patronage Activity Report.
The totals should match. If they don’t, then you have included activity in your Unrefunded Patronage Activity Report that no longer has a patron code defined in the Patronage codes. You can tell this because the report will have a description of PATRONAGE CODE:
This activity will be included in your preliminary reports but will NOT be paid out on the refund.
If they do not match due to this, reverse the refunds, refigure your refund rate, re-issue the refund.

Step 17: Print Checks

After the transactions have been created you will need to go to AP to print the checks.
ACP > Distributions > Patronage Distributions.
Note that there is a unique check form for this. It does NOT use the standard payables check form. This check form prints a summary of patronage accumulation and the ending totals of stock/equity on hand.

Verify the form via ACP > forms manager > Patronage Refund Check Forms to be sure you do not need any changes BEFORE issuing checks. Look for hardcoded dates or possible signature changes, for example.
Note that you can have a user-defined advanced graphic form print that has a signature jpg on the check, so the checks are pre-signed.