Seven data stores appear in Figure 12.4, the level 0 diagram, five of which are related to event occurrences. Of the two master data stores, the customer master was defined in THE “ORDER-TO-CASH” PROCESS: PART I, MARKETING AND SALES (M/S).
Accounts receivable master data contain all unpaid invoices issued by an organization and awaiting payment. As the invoice is created, a record of the receivable is entered in the master data. Subsequently, the records are updated—i.e., the receivable balance is reduced—at the time that the customer makes the payment. The records also could be updated to reflect sales returns and allowances, bad debt write-offs, or other adjustments.
The accounts receivable master data provide information useful in minimizing outstanding customer balances and in prompting customers to pay in a timely manner.
Now let’s look at the event data maintained in the RC process. First, the process records an entry for the sales data after it has validated the shipment and as it produces an invoice. In the previous section, we showed you a specimen invoice (see Figure 12.5). The logical data definition for sales event data would essentially comprise one or more records of invoices. However, each data record would not contain all of the details reflected on the invoice itself. For example, item numbers, descriptions, quantities ordered, quantities shipped, and quantities back ordered typically are not recorded in the sales event data. Rather, these details would be found in the invoice data.
What are the sales data and accounts receivable data stores?
Accounts receivable adjustments data are created as sales returns, bad debt write-offs, estimated doubtful accounts, or similar adjustments are processed as part of managing customer accounts. As in any event data, records in this data store are typically keyed by date.
Cash receipts data, created when customer payments are recorded, contain details of each payment as reflected on the remittance advice accompanying a payment. A remittance advice (RA) is a business document used by the payer to notify the payee of the items being paid. The RA can take various forms. For instance, it may be a copy of the invoice, a detachable RA delivered as part of a statement periodically sent to the customer (often a “stub” attached to the statement, a turnaround document), or a stub attached to the payer’s check. In any case, RC uses the RA to initiate the recording of a cash receipt. Finally, as its name suggests, the remittance advicefile contains copies of the remittance advices themselves.