• From: UK
  • Registered: 03/05/2013
  • Posts: 47

Topic: How to enter a payment for a credit note?

Hi,

Say we buy something for £100.00.  A supplier invoice is raised - and a payment is created and allocated to the invoice.

Say the we find out much later that the supplier has made a mistake - and we're due to get a refund of half the amount. 

So - they send us a credit note for £50.00.

They also put the £50.00 back in our bank account.

Am I right in thinking that we enter the deposit from the 'Banking and General Ledger' screen via 'Deposits'? This seems to work well as the payment can then be allocated to the credit note via 'Purchases' and 'Allocate Supplier Payments or Credit Notes'.

It might be worth flagging up in the wiki as we can't enter a negative supplier payment in the 'Purchases' - 'Payments to suppliers'.  So a bank deposit is the only way to do it.

  • elax
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  • From: UK
  • Registered: 05/17/2011
  • Posts: 326

Re: How to enter a payment for a credit note?

You can't do negative payment. Bank deposit is indeed the way to do it.

3 Reply by nlwowen (edited by nlwowen 10/15/2013 12:39:56 pm)

  • From: Birmingham, UK
  • Registered: 10/15/2013
  • Posts: 3

Re: How to enter a payment for a credit note?

Hi everyone,

Can anyone help with confirmation of the correct process for what I believe is the same question above.
I am unsure of the response that has been given.

If I raise a Supplier Invoice from a supplier for services etc,
The invoice has two elements:-

One for the actual service say - Cost of goods sold @ £100.00 (say - GL 5010)
and one for the VAT (Tax) Element say @ 20% = £20.00 (say - GL 2150)

Total  Invoice value allocated to GL Accounts Payable (Creditors) 2100

I then pay the invoice using supplier payments and thus the corresponding entry from GL Account 2100 and  Bank Account used to pay the invoice - all good.

If i then get a refund direct into my bank, say some time later following week:
I use the Bank Deposits select the supplier and deposit the money from the supplier into the bank account, the
corresponding GL entry is against GL 2100

At this point the suppliers account balance is correct and so is the bank, but there has been no entry against the Tax account or the cost of goods sold account.

So this would cause an inaccurate VAT (Tax Return), And Profit and Loss as the Cost Of Goods Sold will also be out.
Also blowing the TAX Reports.

Surly the correct action is to raise a credit not to duplicate the invoice detail, then offset the credit not either against other outstanding invoices or post as a refund back into the bank.

For this the payments to suppliers would need to be payments/refunds to suppliers and the process should allow for a credit note to be allocated back to the bank.

The reason I ask, is I have this exact problem now, normally all supplier credit notes are just offset against the supplier balance and thus only the difference is paid from the bank. But the supplier I have is not one to be used on a regular basis and has refunded money into the account instead.

The original invoice was in the prior VAT (Tax Quarter) and even though the supplier AND bank are now in balance the VAT (Tax) and PL (Cost of goods is now incorrect.

Any help would be appreciated....

  • elax
  • Senior Member
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  • Registered: 05/17/2011
  • Posts: 326

Re: How to enter a payment for a credit note?

nlwowen wrote:

If i then get a refund direct into my bank, say some time later following week:
I use the Bank Deposits select the supplier and deposit the money from the supplier into the bank account, the
corresponding GL entry is against GL 2100

Right, depends how you do it. You can enter the deposit against the correct account with the correct amount, However it's probably "cleaner" if you enter a credit note. As well, your supplier should send you a credit note (in the same way that I should send you an invoice), otherwise, if the tax man ask, you have no evidence that you didn't need to pay for this service, and so you'll have to pay tax on it. If you have a credit note , then it make sense to enter in FA as a credit note.

In supplier credit note, you can either credit 'items' which have been invoice or enter GL entry manually, so it shouldn't be a problem.
The credit note will against GL 2100, so you'll have to enter a bank deposit against 2100.

/Elax

5 Reply by nlwowen (edited by nlwowen 10/15/2013 01:51:47 pm)

  • From: Birmingham, UK
  • Registered: 10/15/2013
  • Posts: 3

Re: How to enter a payment for a credit note?

Hi Elax,

Thanks for the reply,

Just for clarity and to document for others.

1) I do the credit note to effectively reverse out the original invoice against the gl line items  tax etc.

2) Raise a bank deposit against the receiving bank and 2100, by selecting supplier and select the supplier from list.

3) Go supplier credit note/payment allocations and allocate the credit note against the bank payment.

Have I got it right now ??

Best Regards


I  too thought that if I did the credit note, then chose the supplier entered the deposit against 2100.

What I didn't realise is that if I did the Bank Deposit it would appear in the allocations/payments screen and I could allocate the credit to the Bank Payment.

  • elax
  • Senior Member
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  • From: UK
  • Registered: 05/17/2011
  • Posts: 326

Re: How to enter a payment for a credit note?

nlwowen wrote:

Hi Elax,

Thanks for the reply,

Just for clarity and to document for others.

1) I do the credit note to effectively reverse out the original invoice against the gl line items  tax etc.

Yes, or credit the "item" if the invoice has been done via item. I strongly recommand to use an "item" if you can.

2) Raise a bank deposit against the receiving bank and 2100, by selecting supplier and select the supplier from list.

Yes

3) Go supplier credit note/payment allocations and allocate the credit note against the bank payment.

Have I got it right now ??

Yes.

  • From: Birmingham, UK
  • Registered: 10/15/2013
  • Posts: 3

Re: How to enter a payment for a credit note?

<<<< P E R F E C T >>>>

Thank you again for the help..

Regards

  • From: USA
  • Registered: 04/12/2018
  • Posts: 35

Re: How to enter a payment for a credit note?

Hello,

I am trying to enter a refund that is part of a regular store purchase for maintenance supplies using the Supplier Credit Note process that is detailed above.  I know this discussion is almost six years old but I could not find any other relevant postings close to the problem I am having. 

When I follow the three steps:

nlwowen wrote:

1) I do the credit note to effectively reverse out the original invoice against the gl line items  tax etc.

2) Raise a bank deposit against the receiving bank and 2100, by selecting supplier and select the supplier from list.

3) Go supplier credit note/payment allocations and allocate the credit note against the bank payment.

I end up with the Supplier having a Credit Balance of exactly twice the amount of the refund.  This appears in red numbers on the Purchases -> Supplier Invoices -> "Current Credit" and the Purchases -> Supplier Credit Notes -> "Current Credit".

When I click on the "Current Credit" red numbers, it pops up the Supplier Inquiry window which is the same display as the tab contents when you click on Purchases -> Supplier Transaction Inquiry. 

When I click on Purchases -> Supplier Allocation Inquiry, the tab contents results are "No records".

During the three step process, there were no errors or warnings displayed.  I had assumed every was correct until the next time I tried to enter this supplier invoice it showed the Current Credit I described above.

I also have screen shots of the Supplier Credit Note, the Bank Deposit and all of the GL account records for that day and I can send them to you if needed.

I have absolutely no idea what causes this or how to correct it.  Can anyone help me?

Thank you,
/JimmyC

[url=https://vgruk.com/]buy here[/url]

JimmyC's Website

9 Reply by JimmyC (edited by JimmyC 05/27/2019 03:33:17 pm)

  • From: USA
  • Registered: 04/12/2018
  • Posts: 35

Re: How to enter a payment for a credit note?

If this can help at all, below is the Generate Patch output using WinMerge of just the Credit Note entry using the procedure that was explained above:

50c50
< ) ENGINE=InnoDB AUTO_INCREMENT=391 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
---
> ) ENGINE=InnoDB AUTO_INCREMENT=392 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
444c444,445
< ('390', '20190426-DC1 BBC Paint &amp; Supplies', '20', '248', 'wI9l3HH8HXnHa-RC6AEXygxx', '2019-05-21', '20190426 HomeDepot Paint wRefund.pdf', '1625934', 'application/pdf');
---
> ('390', '20190426-DC1 BBC Paint &amp; Supplies', '20', '248', 'wI9l3HH8HXnHa-RC6AEXygxx', '2019-05-21', '20190426 HomeDepot Paint wRefund.pdf', '1625934', 'application/pdf'),
> ('391', '20190426-DC Credit Note Refund cn', '21', '2', 'xIE1HNAJEo-wPesCnCYCFwxx', '2019-05-24', '20190426 HomeDepot Paint wRefund.pdf', '1625934', 'application/pdf');
463c464
< ) ENGINE=InnoDB AUTO_INCREMENT=5204 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
---
> ) ENGINE=InnoDB AUTO_INCREMENT=5207 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
5675c5676,5679
< ('5203', '22', '247', '1', '2019-05-21 08:21:20', NULL, '7', '2019-04-26', '0');
---
> ('5203', '22', '247', '1', '2019-05-21 08:21:20', NULL, '7', '2019-04-26', '0'),
> ('5204', '21', '2', '1', '2019-05-24 17:58:44', NULL, '7', '2019-04-26', '0'),
> ('5205', '2', '42', '1', '2019-05-24 22:19:05', NULL, '7', '2019-04-26', NULL),
> ('5206', '2', '42', '1', '2019-05-24 22:19:05', NULL, '7', '2019-04-26', '0');
5740c5744
< ) ENGINE=InnoDB AUTO_INCREMENT=2111 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
---
> ) ENGINE=InnoDB AUTO_INCREMENT=2112 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
7857c7861,7862
< ('2110', '22', '247', '1', 'SP19053', '2019-04-26', '-81.29', '0', '0', '3', '20', NULL);
---
> ('2110', '22', '247', '1', 'SP19053', '2019-04-26', '-81.29', '0', '0', '3', '20', NULL),
> ('2111', '2', '42', '1', 'BD19001', '2019-04-26', '22.89', '0', '0', '3', '20', NULL);
11088c11093,11095
< ('22', '247', '2019-04-26', '20190426-DC1 BBC Paint');
---
> ('22', '247', '2019-04-26', '20190426-DC1 BBC Paint'),
> ('21', '2', '2019-04-26', '20190426-DC Credit Note Refund cn'),
> ('2', '42', '2019-04-26', '20190426-DC Bank Deposit Refund bd');
18419c18426
< ) ENGINE=InnoDB AUTO_INCREMENT=6344 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
---
> ) ENGINE=InnoDB AUTO_INCREMENT=6348 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
24772c24779,24783
< ('6343', '22', '247', '2019-04-26', '1010', '', '-81.29', '0', '0', NULL, NULL);
---
> ('6343', '22', '247', '2019-04-26', '1010', '', '-81.29', '0', '0', NULL, NULL),
> ('6344', '21', '2', '2019-04-26', '2010', '', '22.89', '0', '0', '3', '20'),
> ('6345', '21', '2', '2019-04-26', '8200', '20190426-DC Credit Note Refund cn', '-22.89', '7', '1', NULL, NULL),
> ('6346', '2', '42', '2019-04-26', '2010', '20190426-DC Bank Deposit Refund bd', '-22.89', '7', '1', '3', '20'),
> ('6347', '2', '42', '2019-04-26', '1010', '20190426-DC Bank Deposit Refund bd', '22.89', '0', '0', NULL, NULL);
25668a25680
> ('42', '2', 'BD19001'),
27449,27450c27461
< ('486', '12', 'CP18208'),
< ('487', '12', 'CP18209');
---
> ('486', '12', 'CP18208');
27451a27463
> ('487', '12', 'CP18209'),
28245a28258
> ('2', '21', 'SCN19001'),
32123c32136
< ) ENGINE=InnoDB AUTO_INCREMENT=249 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
---
> ) ENGINE=InnoDB AUTO_INCREMENT=250 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
32374c32387,32388
< ('248', '20', '81.29', '2019-04-26', '247', '22', '248', '20');
---
> ('248', '20', '81.29', '2019-04-26', '247', '22', '248', '20'),
> ('249', '20', '22.89', '2019-04-26', '2', '21', '42', '2');
32397c32411
< ) ENGINE=InnoDB AUTO_INCREMENT=251 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
---
> ) ENGINE=InnoDB AUTO_INCREMENT=252 DEFAULT CHARSET=utf8 COLLATE=utf8_unicode_ci ;
32650c32664,32665
< ('250', '248', '20', '8200', '-1', '0', '', NULL, '0', '81.29', '0', '20190426-DC1 BBC Paint &amp; Supplies', '8', '4');
---
> ('250', '248', '20', '8200', '-1', '0', '', NULL, '0', '81.29', '0', '20190426-DC1 BBC Paint &amp; Supplies', '8', '4'),
> ('251', '2', '21', '8200', '-1', '0', '', NULL, '0', '-22.89', '0', '20190426-DC Credit Note Refund cn', '7', '1');
32685a32701
> ('42', '2', '20', 'BD19001', '', '2019-04-26', '0000-00-00', '22.89', '0', '0', '1', '22.89', '0'),
32933a32950
> ('2', '21', '20', 'SCN19001', '20190426-DC cn', '2019-04-26', '2019-04-26', '-22.89', '0', '0', '1', '22.89', '1'),
33147,33149c33164
< ('214', '22', '49', 'SP19020', '', '2019-02-25', '2019-02-25', '-43.33', '0', '0', '1', '43.33', '0'),
< ('215', '22', '4', 'SP19021', '', '2019-02-19', '2019-02-19', '-274.35', '0', '0', '1', '274.35', '0'),
< ('216', '22', '2', 'SP19022', '', '2019-02-16', '2019-02-16', '-116.89', '0', '0', '1', '116.89', '0');
---
> ('214', '22', '49', 'SP19020', '', '2019-02-25', '2019-02-25', '-43.33', '0', '0', '1', '43.33', '0');
33150a33166,33167
> ('215', '22', '4', 'SP19021', '', '2019-02-19', '2019-02-19', '-274.35', '0', '0', '1', '274.35', '0'),
> ('216', '22', '2', 'SP19022', '', '2019-02-16', '2019-02-16', '-116.89', '0', '0', '1', '116.89', '0'),

Let me know if you would like any information that I may provide.

Thank you,
/JimmyC

[url=https://vgruk.com/]buy here[/url]

JimmyC's Website

10 Reply by JimmyC (edited by JimmyC 05/28/2019 01:54:21 pm)

  • From: USA
  • Registered: 04/12/2018
  • Posts: 35

Re: How to enter a payment for a credit note?

To try to make it faster and I hope simpler, I've pasted below the General Ledger entries for that day.  To me, everything looks correctly balanced and should not show when I click Purchases -> Supplier Credit Note -> "Current Credit:    -45.78".  This Current Credit amount is exactly twice the amount of the refund of $ 22.89.

Type         #    Reference      Date             Account             Person/Item             Debit         Credit

Supplier    248    SI19053    04/26/2019    2010 AP        Supplier [00020] HD                     81.29
Invoice
Supplier    248    SI19053    04/26/2019    8200 BldExp    Supplier [00020] HD        81.29
Invoice
Supplier    247    SP19053    04/26/2019    2010 AP         Supplier [00020] HD        81.29
Payment
Supplier    247    SP19053    04/26/2019    1010 OprAcct    Supplier [00020] HD                  81.29
Payment
Supplier    2      SCN19001    04/26/2019    2010 AP         Supplier [00020] HD        22.89
CreditNote    
Supplier    2      SCN19001    04/26/2019    8200 BldExp    Supplier [00020] HD                  22.89
CreditNote    
Bank        42     BD19001    04/26/2019    2010 AP        Supplier [00020] HD                     22.89
Deposit
Bank        42     BD19001    04/26/2019    1010 OprAcct    Supplier [00020] HD        22.89

If anyone experiences this or if anyone knows what I am obviously doing incorrectly, please enlighten me, it would be greatly appreciated.

Thank you,
/JimmyC

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  • From: USA
  • Registered: 07/16/2017
  • Posts: 276

Re: How to enter a payment for a credit note?

Its a bug.  I suggest you open a bug report on http://mantis.frontaccounting.com/ referencing your post so it doesn't get lost.

  • From: USA
  • Registered: 04/12/2018
  • Posts: 35

Re: How to enter a payment for a credit note?

Thank you @Braath Waate!

I opened a bug report #0004895 and referenced this topic discussion.

/JimmyC

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  • From: Singapore, India, Chennai
  • Registered: 05/02/2009
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Re: How to enter a payment for a credit note?

@joe: ??

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  • joe
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  • Posts: 5,085

Re: How to enter a payment for a credit note?

We are monitoring this. Please help me with a solution, if you can?

/Joe

  • From: Singapore, India, Chennai
  • Registered: 05/02/2009
  • Posts: 6,089

Re: How to enter a payment for a credit note?

The functions supplier_credit_rowand customer_credit_row() are defined in includes/ui/ui_input.inc in lines 982-1004.

The link for the supplier_credit_row() is like:

purchasing/inquiry/supplier_inquiry.php?supplier_id=###

The actual value of $credit is being passed into the said functions from/by the calling script which in this case appears to be twice the value it should report..

The supplier_credit_row() is called in:

purchasing/includes/ui/po_ui.inc line 145 (function display_po_header(&$order)):
    supplier_credit_row($order->supplier_id, $order->credit);

purchasing/includes/ui/invoice_ui.inc line 160 (function invoice_header(&$supp_trans)):
    supplier_credit_row($supp_trans->supplier_id, $supp_trans->credit);

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  • joe
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  • Posts: 5,085

Re: How to enter a payment for a credit note?

Hello,

I cannot reproduce this on my fresh copy of FA.

Please download the snapshot from our master repo here:

https://sourceforge.net/p/frontaccounting/git/ci/master/tree/ [^]

The error you are reporting has been fixed during this 2.4.5 or 6 period.

Please try if you can reproduce the error in the above snapshot.

I hope so. We will ship a new minor release asap.

Regards
Joe

17 Reply by JimmyC (edited by JimmyC 06/02/2019 03:23:02 pm)

  • From: USA
  • Registered: 04/12/2018
  • Posts: 35

Re: How to enter a payment for a credit note?

@Joe

I downloaded the latest snapshot, replaced all old files with the new snapshot files. 
Logged into FA and entered a supplier credit note for $22.89 USD. 
Opened the Supplier Invoices screen and it showed Current Credit:  $22.89.
Went to Banking and General Ledger -> Deposits and selected Supplier -> Home Depot.
Defaulted to 2010 Accounts Payable and entered Amount -> 22.89 -> Process Deposit.
Went to Purchases -> Supplier Invoices and Current Credit was $45.78.
Went to Purchases -> Allocate Supplier Payments or Credit Notes -> Home Depot.
Only one line displayed Supplier Credit Note : Home Depot : Total : 22.89 : Left to Allocate : 22.89.
Clicked the "Allocate" icon and entered the Allocation screen where I entered 22.89 into the "This Allocation" box -> Process.
The screen cleared and "no records".
Went to Purchases -> Supplier Invoices and Current Credit was $45.78.

As you can see, after entering the latest snapshot, there is no difference in output.

As a side note, I can reason why a Deposit by a Supplier causes a Credit.  But I can't understand why we have to do both processes?  That  is, I create a Supplier credit note and then the system automatically creates another credit note from the Deposit but the "allocation" process does not balance out either one.  I really do not know how it is supposed to be done correctly by Bookkeeping rules.

Good luck and thank you for working on it.

/JimmyC

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  • joe
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  • Posts: 5,085

Re: How to enter a payment for a credit note?

@JimmyC.
Ah, now I understand what you mean. It is the presentation of the Suppliers Balance that is wrong when entering a Suppplier Invoice.

The Supplier Balance reports are ok.

I will check the algorithm for calculating the suppleir balance in the Supplier Inovice form.

/Joe

  • From: USA
  • Registered: 04/12/2018
  • Posts: 35

Re: How to enter a payment for a credit note?

@Joe

The Supplier Credit Notes form also shows the same amount as the Invoice form.

/JimmyC

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  • joe
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Re: How to enter a payment for a credit note?

This has now been fixed. Committed to stable repo.

The fixed two files can be downloaded here and here.

/Joe

  • From: USA
  • Registered: 04/12/2018
  • Posts: 35

Re: How to enter a payment for a credit note?

@Joe

Yes! It works!

A thousand "Thank You"s!

/JimmyC

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