Understanding Invoice Match with Deduction (TI Code 17)

Entering receipts and drafts with deductions is a method of postponing a response to a short payment from the customer without delaying payment entry. You can enter the payment immediately while another person researches and resolves the deduction. Some common reasons that a customer might take a deduction are:

Damaged or defective merchandise.
Unearned discounts.
Billing errors.
Refusal to pay shipping charges or tax.
Shortages in the shipment of merchandise.

You specify that you want the system to calculate deductions by using type input code 17. If the amount applied to the invoice is less than the receipt amount, the system updates the Deduction Amount field for the difference automatically. The system also updates the deduction reason code with the default value that you specify in the processing options.

When you enter a receipt or draft with a deduction, the system generates documents in these tables:

Table	Document
F03B11	A deduction invoice document, which takes the place of a specific invoice or group of invoices, for the disputed amount that you want to research and resolve. The system closes the invoice, marks it as paid, creates a new deduction invoice record, and assigns the document type R5 to it. The deduction invoice record has these characteristics: It establishes an audit trail to the receipt payment ID. It establishes an audit trail to the original invoice (if the deduction was generated for a specific invoice). It is expressed as a debit amount. It has a batch type of either RB (if generated from a receipt application) or DB (if generated from a draft application). It contains a posting status of D (posted). The posted codes for the payment records in the F03B13 and F03B14 tables remain blank until the receipt or draft is posted.
F03B13	The payment record.
F03B14	The detail record that pays the invoice from which the deduction was generated.

Table

Document

F03B11

A deduction invoice document, which takes the place of a specific invoice or group of invoices, for the disputed amount that you want to research and resolve. The system closes the invoice, marks it as paid, creates a new deduction invoice record, and assigns the document type R5 to it.

The deduction invoice record has these characteristics:

It establishes an audit trail to the receipt payment ID.
It establishes an audit trail to the original invoice (if the deduction was generated for a specific invoice).
It is expressed as a debit amount.
It has a batch type of either RB (if generated from a receipt application) or DB (if generated from a draft application).
It contains a posting status of D (posted).

The posted codes for the payment records in the F03B13 and F03B14 tables remain blank until the receipt or draft is posted.

F03B13

The payment record.

F03B14

The detail record that pays the invoice from which the deduction was generated.

Regardless of the type input code that you use, if you specify a deduction amount and reason code, the system creates a deduction record.

After you enter receipts and drafts, you must post them. When you post payments with deductions, in addition to the bank account (or draft receivables account) and A/R trade account, the system debits the deduction suspense account that is set up for the AAI item RN. The system also creates records in the A/R Deduction Management table (F03B40). The deduction record enables you to research and resolve the reason for the deduction at a later time.

Note:

If you have to change the deduction amount or void the payment after it is posted, you must first reverse or void the deduction record (F03B40) using the deduction application. You can, however, revise other non-deduction payment detail records.