Financial Institutions [FM]

Financial Institutions

From the DockMaster menu, select File Maintenance > Financial Institutions

This section is used to provide bank information for A/P check processing and Boat Sales calculations.

Accounts Payable

The Financial Institution code is also referred to as a Bank Code in A/P processing. The Bank Code provides the following information to A/P:

The G/L Cash Account is credited when a check is printed.
The A/P Check Format determines the print format of the A/P check.
The Next Check # determines the beginning check number for the next automated check run.
The Audit Limit determines the maximum check amount.

Boat Sales

Each lending institution that you write boat contracts for should be set up in the Financial Institution File. This file determines the following defaults for financial calculations and accounting when this institution is used to finance a contract:

The Cash Account (asset) will serve as the credit entry when a Serialized Boat Deposit is paid. Note: If you are drawing on a line of credit to pay deposits, you may also use a Notes Payable account in lieu of the Cash Account here.
F&I Form Format - this is the default bank contract form, which will be printed when this Financial Institution is used on a contract. A default Financial Institution Code can be entered in the Boat Sales Parameters. This code will automatically appear on each financed contract and Quick Quote; it can be changed at the users discretion.
Income Account - is credited when dealer reserve income is booked on a contract for a financial institution.
Reserve Account - this account is debited for the interest reserve amount booked on a contract (this account is your Dealer Reserve A/R account).
Maintain the Draft Account field in each Financial Institution you will receive drafts from. The draft account (liability) will serve as the credit entry when a draft is received.
Maintain the Draft Pay Type field in each Financial Institution you will receive drafts from. If the draft pay type entered is a ‘Post to A/R’ type, then you will have to enter a Customer ID in the Financial Institution if one doesn’t exist.
Reserve Rate - interest rate you pay to this institution for floor plan monies or points you receive for a given interest rate level.

General [tab]

Institution ID - Enter an Institution ID. Any combination of up to 5 letters and/or numbers can be used. Press F6 to get a list of existing codes.
Name Box - Enter the Name of the Financial Institution. Any combination of up to 25 letters and numbers can be used.
Customer ID - Enter a Customer ID if this is a Bank or Finance Company that you write finance contracts with. The amount of reserve income due to you from the finance company will be booked to this customer account so that you can track your reserve receivables.
Branch - Enter the Branch name of the Financial Institution.
Address - Enter a street Address where the financial institution is located. You are given 3 lines to enter in the street address. If you do not need additional address lines, leave them blank.
City - Enter the City where the financial institution is located.
State/Province - Enter the State/Province. A two-letter abbreviation is required. Use the official U.S. Post Office abbreviation.
Postal Code - Enter the Postal Code. Either a five-digit or nine-digit numeric code can be used.
Country - Enter the vendor’s Country. If Canada or CAN is entered, the Postal Code format in the next prompt will be #A# A#A (3C1 H7J).
Phone - Enter the Phone number. You can enter the phone number using any format. For example, you can enter 4075551212, 5551212, (407)5551212, or 407-555-1212. If you don't enter an area code the system will default to the area code used in your DockMaster Parameters.
Account Number - Enter your Account Number with this Institution.
Tax ID - Enter the Financial Institution’s Tax ID number.
Contact - Enter a Contact name. Any combination of up to 25 letters and/or numbers can be used.
A/P Check Format - Enter the A/P Check Format for this Financial Institution or press F6 to view the formats available. Note: This prompt is mandatory if you are going to print A/P checks using this bank code.
F&I Form Format - Enter the F&I Form Format for this institution. This is the bank's financing form to be used for printing finance contracts. All finance forms can be entered or modified through the Layout Maintenance program located in the Boat Sales module. DockMaster can design forms for a nominal fee. The Boat Sales module uses this prompt.
Cash Account - Enter a General Ledger Cash Account number or press F6 to list the Chart of Accounts if the G/L is installed. In Accounts Payable this account will be credited when you use this financial institution (bank code) to print A/P checks or P/R checks. With regards to Boat Sales, the Cash Account (asset) will serve as the credit entry when a Serialized Boat Deposit is paid. Note: If you are drawing on a line of credit to pay deposits, you may also use a Notes Payable account in lieu of the Cash Account here.
Income Account - Enter a General Ledger Income Account number or press F6 to list the Chart of Accounts if the G/L is installed. This account will be credited if a finance reserve is booked on a boat sales contract for this institution. The Boat Sales module uses this prompt.
Reserve Account - Enter a General Ledger Reserve Account number or press F6 to list the Chart of Accounts if the G/L is installed. This account will be debited if a finance reserve is booked on a boat sales contract for this institution. The Boat Sales module uses this prompt.
Draft Account - Maintain the Draft Account field in each Financial Institution you will receive drafts from. The draft account (liability) will serve as the credit entry when a draft is received. The Boat Sales module uses this prompt.
Draft Pay Type - Maintain the Draft Pay Type field in each Financial Institution you will receive drafts from. If the draft pay type entered is a ‘Post to A/R’ type, then you will have to enter a Customer ID in the Financial Institution if one doesn’t exist. The Boat Sales module uses this prompt.
Next Check # - The Next Check # prompt is updated by the A/P Check Printing program. You can enter your starting check number on your check stock to initiate this number.
Audit Limit - Enter an Audit Limit for this bank code. The audit limit determines the maximum check amount; however, this function is not active at this time.

Loan Reserve Rates [tab]

Select the Loan Reserve Rates Tab to enter information about buy and sell rates for financed contracts. The rates entered on this tab will be used as default rates when this lending institution is used to finance a boat contract; the rates can be overridden at any time. The Boat Sales module uses this information.

Amortize Reserve - Click on this box if you will receive an amortized portion of the interest reserve from the lending institution each time a loan payment is made by the boat buyer. Leave this box cleared if you will receive a lump sum interest reserve payment from the lending institution when the contract is approved.
Up Front Percentage – Enter the Up Front Percentage required on a deal financed with this institution.
Reserve Rates – click on the Reserve Rates grid to enter your rate chart.
If you clicked on the Amortize Reserve box, then enter your BUY RATE on line one of the Reserve Rates grid. The cursor will then proceed to the Rate Schedule grid where you can enter your SELL RATE(S) for any range of financing. An example is shown on the next page.
If you left the Amortize Reserve box clear, then enter the points that you are paid for each interest rate that you sell on a contract as your reserve rates. The cursor will then proceed to the Rate Schedule grid where you can enter your the interest rate level for each point. An example is shown on the next page.

Once you enter your reserve rates, the cursor will move to the Rate Schedule grid and allow you to enter your SELL RATES for each level of financing.

Greater Than and Less Than columns - Enter a range for the Amount to be Financed. If you want the same SELL RATE to default for all dollar ranges, enter zero (0) as the first value, and press Enter to accept 9,999,999 as your second value.

In the event that a lending institution increases or decreases their sell rates, the F7 key will increase your sell rates by .25% and the F8 key will decrease the rates by .25%. If there are different financing levels (0 - 4999, 5000 - 9999), you must place the cursor on each line to change the rates.

Two examples are shown below which show the difference between the charts for an institution that amortizes the interest reserve and one that doesn't.

Most lending institutions will supply these charts or the figures to create them.

Example: Institution that Amortizes the Interest Reserve
ABC Bank charges you 8.00% interest on all contracts purchased. You can charge any rate equal to or over this 8.00%. You decide to make your default rate on all contracts between (0 and 25000) 10.00% and between (25000 and 9999999) 9%.

The maximum loan term is 120 months on all contracts, and you normally require a 10% down payment.
The Reserve Rates grid should look as follows:

Reserve Rates
Rate
8.00

The Amount Financed chart should look as follows:

Rate Schedule
Greater Than	Less Than	Max Term	% Down	Flat Reserve	0.0000 %
0	25,000	120	10.00	1000	10.00
25,000	9,999,999	120	10.00	950	9.00