Deduction and Chargeback Management
The Deduction and Chargeback Management SuiteApp enables the A/R Clerk role to efficiently account for customer deductions, chargebacks, and write off small balances.
For information about managing deductions and chargebacks, watch this video:
For information about managing small balances write-offs, watch this video:
The SuiteApp has the following three parts:
The Deduction and Chargeback Management SuiteApp hasn't been tested with SuiteTax.
Deductions
Deductions are valid expenses taken out of the account’s receivables. If a customer pays less than the full amount on one or more invoices, the difference is called a deduction. Deductions can happen for different reasons, like extra insurance costs for the customer, volume sales rebates, and more.
Chargebacks
A chargeback is when you bill the customer for expenses they didn't agree to. You can also use a chargeback when you need to look into a deduction claim before writing it off.
The main difference between deductions and chargebacks is that with a chargeback, the A/R clerk doesn't write off the payment difference from the customer's account. The trade invoice gets paid after the payment difference is handled with a separate chargeback invoice. This means the trade invoice is paid in full, but the chargeback invoice stays open.
Small Balances Write Offs
Sometimes, even after invoices are paid, a small balance is still left over. To avoid these small balances, the A/R clerk might write them off to an expense account and close the invoice. For example, small balances can happen when payments use different currencies and exchange rates change. Instead of sending the remaining balance back to the customer, the A/R clerk covers it using a set small balance threshold.