PROFCOM

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PROFCOM.PNG
Name Profit Commission
Shortcut PROFCOM
Area Policy

See the NOVUS Walkthrough Guide for general information about the system.


This program allows you to create a PRC (Profit Commission) transaction comprising an insurer amount, a broker amount, and a cover holder amount.

A suitable fee code must be set up in the FEES program, structured to debit all insurers and credit a revenue (pot) partner account. It is possible to use an existing revenue (pot) partner account but you may have a requirement to set up a separate revenue (pot) partner account to hold profit commissions separately from your other revenue.

The user enters the split between (all) insurers, (all) clients, and the revenue (pot) account This entry in the PROFCOM program must sum to zero. This means that the insurers debit can go entirely to the revenue (pot) account or some/all of it can be passed to the clients (cover holders).

Third-party involvement is outside the specifications of this program.

Apart from the specification of the tax code, the first few fields are completed in the usual way. The tax code is used to determine the IBA (insurance brokerage account) revenue (pot) account which will be used to accept the broker amount. The tax code must be one that specifies a revenue (pot) account as a credit item.

Profit commission is normally payable to the broker by the insurers and the amount of this payment will depend on the performance of the policy/treaty.

Therefore normally enter a debit amount in the insurer field, a credit amount into the broker field and a balancing credit amount into the coverholder field (if any). The resulting transaction is a type PRC written entirely against the tax code specified above. A typical entry might look like this:-


PROFCOM 2021 v2.JPG


Note that this program requires known figures to be entered. It could be possible to consider this figure is computed automatically from the historical entries for this policy/treaty but please refer to Morning Data if this would be a requirement.<be>

After the transaction has been posted it can be checked using the ETRAN program. EPERIOD can be used to check that the correct values have been applied to client, company, and fees columns.


Version History

v 5.0.0 – Updated to latest version

v2G - Added a post change event on accounting date to check if the date entered is not in a closed period