How is the Flat Penalty calculation done in ADDA?

How is the Flat Penalty calculation done in ADDA?


Example:

Flat Penalty: 200 Rs
Invoice date: 01/04/2021
Due date: 10 of every month
Invoicing Frequency: Monthly
Invoice Amount: 4000 Per month

Case-1: Full Payment before the due date.

No Late Penalty will be levied in the month of May

The May invoice will be as below:

Maintenance Fee               4000                       

-----------------------------------------------
Gross Payable                    4000
Arrears(April)                       4000
------------------------------------------------
Net Payable                        8000


Case-2: Full payment after the due date. i.e, payment made on 25th April.

Rs 200 will be posted as Penalty

The May  invoice will be as below:

Maintenance Fee               4000
Late Penalty                         200
-----------------------------------------------
Gross Payable                    4200
Arrears(April)                       4000
------------------------------------------------
Net Payable                        8200


Case-3: Partial payment before the due date. i.e, Rs. 2000 paid before 10th April and remaining payment (Rs.2000) is NOT made until next invoice generation on 1st May.

Rs 200 will be posted as Penalty

The May Invoice will be as below:

Maintenance Fee               4000
Late Penalty                         200
-----------------------------------------------
Gross Payable                    4200
Arrears(April)                       4000
------------------------------------------------
Net Payable                        8200


Case-4: Partial payment after due date. i.e., Rs 600 is paid on 25th April and the remaining payment is NOT made until the next invoice generation on 1st May

Rs 200 will be posted as Penalty

The May Invoice will be as below:

Maintenance Fee               4000
Late Penalty                         200
-----------------------------------------------
Gross Payable                    4200
Arrears(April)                       4000
------------------------------------------------
Net Payable                        8200


Case-5: No payment made till 1st May.

Rs 200 will be posted as Penalty

The May invoice will be as below:

Maintenance Fee               4000
Late Penalty                         200
-----------------------------------------------
Gross Payable                    4200
Arrears(April)                       4000
------------------------------------------------
Net Payable                        8200


In all the above cases LPI will be posted in the next system-generated invoice posted on 1st May as separate line item.
 
Note: In Cases 3, 4, and 5- for April Invoice the Interest will start calculating from day 1 (1st May ) if no respective Payments are done beyond this date. This is because there is no grace period for April Invoice in the period May
 
Ex: let's assume that respective payments are made on 05/05/2020 of Rs 8200, Penalty of Rs 200 will be charged for 5 days (1st to 5th May) as below.

And this will be posted in the next system-generated invoice on 1st June.

June Invoice will be as below:

Maintenance Fee               4000
Late Penalty                         200
-----------------------------------------------
Net Payable                         4200

If the full payment is done after the due date, Rs 200 will be charged for the April invoice and Rs 200 will be charged for May.

June Invoice will be as below:

Maintenance Fee               4000
Late Penalty                         400
-----------------------------------------------
Net Payable                        4400

If there is no payment is done till May 31st, Rs 200 will be charged for the April invoice and Rs 200 will be charged for May.

June Invoice will be as below:

Maintenance Fee               4000
Late Penalty                         400
-----------------------------------------------
Gross Payable                     4400
Arrears(April & May)                       8200
------------------------------------------------
Net Payable                        12600

The same logic can be applied to Quartely, Half yearly or Yearly Invoicing systems.


















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