Create an Adjustment Transaction (Outside Referral)

Please review the Transaction Adjustment Guide to understand the process for correcting Transaction errors with Adjustments.

Adjustment Transactions are used to make corrections to Transactions that were closed in a prior period.  An Adjustment Transaction is like doing a journal entry where when you take the initial Transaction and the Adjustment Transaction and add the numbers together, you should end up with the final distribution of commissions.  

If the Transaction is in the current month, undo the original transaction, make the corrections, re-close the transaction, create the deposit and upload to AccountEdge. Remember to delete the original deposit from AccountEdge.  

Here's a summary of the steps to complete an Outside Referral Adjustment Transaction. Continue to the bottom of the article for more detailed instructions. 

1. Log in to https://agent.kw.com with your KW login credentials.

2. At the top of the page, click CommandMC.

3. Click to access the Transactions Applet, , on the left side of the page.

4. Locate the original closed Transaction from the prior period that needs the Outside Referral added, and click on the Transaction ID to open it. 

5. At the bottom right of the page, click Create an Adjustment.

6. Select Outside Referral, then click Start Adjustment. 

7. On the General Information page the date of the adjustment will be auto-populated to the current date, or the last date of the current period of the month being closed. Click Next to Commission Details.

8. On the Commission page, click Add Outside Referral (this information is pulled from the Vendor database). If the referral partner has not yet been entered in your Vendor database, add them to the Vendor database, and return to the Adjustment Transaction. 

9. Enter the Agent's name to search for the Outside Broker record, select the appropriate record, and enter the amount of the referral (Total Commission will show as a negative). Click Add Outside Referral to close the window, then click Next to Agent Details.

10. The Agent Details screen will correct the commission originally paid to the Agent and add it to the referral: 

• Enter the amount of the referral in the Outside Referral field. The remaining fields will auto-populate as follows:
• Total Commission - this will show as a negative as this is the amount of commission being taken back from the agent to pay to the referral partner. 
• Brokerage Fees - the system will automatically calculate these figures if the agent is not yet capped.
  • Royalty & Company Dollar - these will show as negative numbers if the agent is not yet capped. Company Dollar will be added back to the agent's Company Dollar cap owed to the Market Center. 
    • If the agent is capped on Royalty, the system will auto-calculate to zero. The Royalty paid on the original transaction will apply toward their Royalty cap. 
    • Do NOT override or adjust the royalty. 
  • Agent 1099 Income - This will show the dollar adjustment that will reflect on the agent's 1099. 
• Summary:
  • Agent Check amount reflects the amount to collect from the agent
  • Pay to KW reflects the amount that has been added back to the agent's cap.

11. Click Save Adjustment. A notification will appear that the transaction was created and the Commission Reconciliation window will appear. 

12.  On the Financials tab, the Commission Reconciliation should balance to zero with no further action needed. Click Close Transaction, at the bottom right of the page.

• Best practice is NOT to record any money received from the agent in Checks Received. When money is collected from the agent this will be recorded directly into AccountEdge using the Receive Money option. The payment received from the agent will be recorded to the Clearing Commission account 5-0060.

• Pay to KW: This reflects the amount of company dollar and/or royalty that was assessed on the referral portion of the original transaction. The amounts assessed on the referral were not subject to company dollar and commission because referrals are taken off the top.

  • Be aware that processing this adjustment could uncap the agent if they are already capped. 

• Disbursement: The amount for the agent should be a negative amount to be paid (since this is being received back from the agent). 

  The amount under Other Brokers should be a positive amount to be paid to the Outside Referral. 

  Ready to be Paid reflects the difference between the Referral and the amount being collected from the Agent. This is only for reference. 

• Balance: This will show zero. The transaction is considered balanced, and when the adjustment is closed and the deposit is imported into AccountEdge, Clearing Commission will have a balance of the amount the agent owes the Market Center, plus the amount the Market Center owes the referral partner.

• Totals Paid: The amount ready to be paid

13. A confirmation will appear, click Yes, Close. 

14. Create the Deposit and Import into AccountEdge.

• A best practice is to keep adjustment transactions on a separate deposit. 
• Since no money was collected, the transaction will show as having a zero check amount.

15. Pay the Outside Referral. Based on the amount shown in the transaction to be paid to the Other Broker, cut a check to the Outside Referral from the Clearing Commission account. 

16. Collect the funds from the agent and record it as Received Money, coded to Clearing Commission. 

17. Confirm Clearing Commission account is zero.