Adjustment DA – Add, Remove, or Change Who is Charged a Deduction – KWMCAngel

Adjustment DA – Add, Remove, or Change Who is Charged an Outside Referral

If this is your first Adjustment DA, please review the Adjustment DA Guide to understand the process for correcting transaction errors through Adjustment DAs.

Adjustment DAs are used to correct production on a DA that was entered in a prior month and has been transmitted. An adjustment DA is like doing a journal entry where when you take the initial DA and the adjustment DA and add the numbers together, you should end up with the final distribution of commissions.

If the DA is in the current month, you will correct/update the original DA.

The below example assumes you have issued checks to the Associate and those checks have already been cashed. Following the process as documented places balance due for the referral back in your clearing commissions account so you can issue the correct checks/ACH to each party owed.

If you have the original check un-cashed, then you will void the original check in AE and enter $0.00 as the amount collected in the check box when posting the DA. When you void the original check in AE and write the new check for the correct amount, the difference stays in your clearing commission to write to each party owed.

Begin with a $0.00 balance in 50060

This is necessary to confirm when all steps have been completed correctly.

Step 1 / Page 1 – Closing Information

Create a new DA
Close Date: First day of current month
Contract Date: First day of current month

Adjustment Type: Regular
Change to DA#: Original DA number
Type: S - yes, use S even if it was a listing or dual agency
Class: P
Property Code: R

Street Address: Adj to DA ####
Click Save/Part 2

Step 2 / Page 2 – General Commission Information

Because you are not changing any of the numbers related to sales price or commission listed on the HUD, these entries are 0 to reflect no change.

Price: 0
Sales Commission: 0
Unit: 0

Because the original commission has already been recorded on a DP, only one “side” of the check transaction will be involved - Spend Money.

Check For: 1
Deposit #: enter a unique deposit number; Adjustment DAs should always be on a deposit by themselves

Step 3 / Associate Detail Screen

Add associate to DA
Type: S
Class: P

Agency: B
Unit: 0
GCI: 0
Keep tabbing through the detail screen, making sure to zero out E&O Insurance and any automatic deductions.
Deduction(s): add the amount of the deduction (+$0.00 if the associate needs to pay someone or -$0.00 if the associate needs to be refunded) and select the corresponding deduction information

Note the amount in the Associate Check field. If negative (adding a deduction), this is the amount the original agent owes back to the market center. If positive (removing a deduction), this is the amount the market center owes the agent.
Click OK

Remove a Deduction – to remove a deduction, enter a negative value for the deduction that was mistakenly added on the original DA

Add a Deduction – to add a deduction, enter a positive value for the deduction that should be taken

To change which associate is charged a deduction, add both associates and

Use the remove deduction steps for the associate who should not have been charged the deduction
Use the add deduction steps for the associate who should have been charged the deduction.

Both associates must be added to the Adjustment DA for the correction to take effect.

Page 2 – Complete the Deposit Balancing Information

To complete the terms on Page 2 to balance the Adjustment DA,

In the Check Box,

Enter 0 in the first box

Enter $0.00 in the second box

In the Reconcile Box

Click into the first empty cell to reveal funds owed back to the market center
Add “Pay to KW” in the Description field

Recording the Transaction

All DAs – regular and Adjustment – must be recorded in AccountEdge/LoneWolf even when no new funds are being received or issued:

Save the DA
Save the DP
Import the DP into AccountEdge or Lonewolf
Spend Money from 50060 where a positive amount is listed on the DA
Receive Money into 50060 where a negative amount is listed on the DA

All funds must be accounted for. The originally issued funds will either be voiding when the original check is returned to be voided/reversed or the party writes a check back to the market center.

End with a $0.00 balance in 50060

Pay careful attention to the Royalty Exception effects of completing adjustment DAs. Run your Royalty Exception Report following each Adjustment DA posted and follow the instructions in How to Request a Franchise Royalty Adjustment to address an imbalance between your royalty accounts on your Income Statement well before transmittal.

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