Chargebacks and Adjustments
Receivables lets you create adjustments and chargebacks against transactions to which you are applying a receipt. You can create multiple chargebacks and adjustments against each transaction, for positive or negative amounts.
Receivables lets you enter a chargeback against a credit memo or an on-account credit if they have a positive balance.
Receivables uses the transaction type of the transaction you are adjusting to validate the adjustment or chargeback amount. If the transaction type does not allow over-application, you cannot enter an amount that would reverse the sign of the balance of the debit item. Chargebacks and adjustments do not follow the Natural Application rules; this lets you adjust transactions in either direction, regardless of the Natural Application flag. For more information, see: Transaction Types.
If the profile option AR: Allow Actions is set to No, the Chargebacks and Adjustments buttons are not available in the Applications window.
Creating a Chargeback
Use chargebacks to create a new debit item for your customer when closing an existing debit item. For example, your customer sends payment of $75 for a $100 invoice. You can apply the receipt to the invoice, then create a chargeback for the balance due.
Receivables requires that you automatically number your chargebacks. You can change the base number for your chargeback numbering sequences by updating the Last Invoice Number field for this chargeback batch source in the Transaction Sources window. See: Transaction Batch Sources.
Prerequisites
To create a chargeback:
1. Navigate to the Receipts window.
4. Select or enter the Transaction to which you want to apply this receipt. See: Applying Receipts.
5. Choose the Chargebacks button.
6. Enter the transaction Type and the Amount of this chargeback. The default chargeback amount is the remaining amount of the transaction. Receivables displays the new remaining amount in the Balance Due field. You can enter an amount greater than the balance due only if the Allow Overapplication option for this transaction type is Yes. For more information, see: Transaction Types.
7. If document numbering is enabled and the document sequence associated with this receipt is Manual, enter a Document Number for this chargeback. If the sequence type is Automatic, Receivables assigns a document number when you save.
8. Enter the Account for this chargeback. The transaction type provides the default account, but you can change it.
9. Enter the Due Date for this chargeback. The default due date is the value of the Chargeback Due Date parameter in the System Options window. For example: Current Date, Deposit Date, Open Invoice Due Date, or Receipt Date.
10. Open the More alternative region, then enter a Reason for creating this chargeback and any Comments (optional). Chargeback reasons can include Refund, Billing Error, or Write Off. You can define additional chargeback reasons in the Receivables QuickCodes window. See: Defining Receivables QuickCodes.
Note: The Transaction Code field is only used by Public Sector Accounts Receivable.
11. Save your work. Receivables uses the chargeback batch source to automatically number your chargeback and assigns the default payment term 'IMMEDIATE.'
Note: You can view the payment term, GL date, and other information about this chargeback in the Transactions window. To do this, perform a query using the chargeback number.
Creating an Adjustment
Create adjustments to increase or decrease the balance due for an invoice, debit memo, chargeback, or commitment. For example, you apply a receipt to an invoice, but there is still an open balance of two dollars. You can create an adjustment to write off the remaining amount and close the debit item.
Prerequisites
To create an adjustment:
1. Navigate to the Receipts window.
4. Select or enter the Transaction to which you want to apply the receipt. See: Applying Receipts.
6. Enter an Activity Name and choose the Type of adjustment you are creating. Valid adjustment types include Invoice, Line, Charges, Freight, and Tax.
7. Enter the Amount of this adjustment. If you specify 'Invoice' as your adjustment type, Receivables requires that the amount of your adjustment be at least enough to close the item you are adjusting, and displays this value in the Amount field. If the amount of this adjustment is outside your adjustment approval limits, Receivables sets the status of the adjustment to Waiting Approval when you save (unapproved adjustments do not update the balance due for an item).
Attention: You can enter an amount greater than the balance due only if the transaction type's Allow Overapplication option is set to Yes. For more information, see: Transaction Types.
8. Enter the GL Date for this adjustment. The default is the later of either the transaction GL date or the current date. However, if this date is not in an open period, the default GL Date is the last date of the most recent open period. The GL date must be later than or equal to the GL date of the debit item you are adjusting and must be in an open or future-enterable period.
9. Enter the Adjustment Date. The default is the current date, but you can change it.
10. Open the Account, IDs alternative region, then enter the GL Account for this adjustment. The activity name provides the default GL account, but you can change it.
11. If you are using manual document numbering, enter a unique Document Number for this adjustment. If you are using automatic document numbering, Receivables assigns a document number when you save. See: Implementing Document Sequences.
12. Open the Comments alternative region, then enter a Reason for creating this adjustment. Receivables prints your reasons on the Adjustment Register.
13. Update the Status of this adjustment (optional). If this adjustment is within your user approval limits, you can choose any status. If you are reviewing a previously approved adjustment, Receivables skips this field.
14. Save your work. Receivables generates a unique number for this adjustment.
See Also
About Adjustments
Foreign Currency Transactions
Transaction Types
Adjustment Register
Define chargeback standard memo line