Adjusting Customer Payments

Outcome

Customer payments are executed. Payment differences are dealt with. Invoice and payment records are netted. Credit memos and debit notes are created. Payments that cannot be allocated are recorded on account for further investigation.

Follow up write-offs, payment tolerances, cash discounts, bill backs and debit notes by selecting column templates with the following value types in 'Accounts Receivable. Display Balances' (ARS225):

Value Type	Description	Currency
62	Payment tolerances	Local
162	Payment tolerances	Foreign currency
63	Bill back	Local
163	Bill back	Foreign currency
64	Debit note	Local
164	Debit note	Foreign currency
65	Write-offs by using option 20-98 in 'Payment Received. Record' (ARS110/F)	Local
165	Write-offs	Foreign currency

Accounts receivable and the general ledger are updated.

Which transactions are created for deductions, write-offs, and other differences is controlled by the 'Split payment transaction' field for the FAM function used.

Before you start

• The starting conditions listed in Allocating Customer Payments to Invoice must be met.
• For recording user-defined adjustments of customer payments, accounting options must be defined in 'AR Accounting Option. Open' (ARS020).

Follow These Steps

All the activities below are carried out in 'Payment Received. Record' (ARS110/F).

1. Accept and Write Off Differences

   Write off or otherwise manage differences between a customer payment and the corresponding invoice record:

   • Manually write off payment difference
   • Automatically write off payment difference
   • Accept cash discount.

   Any currency deviation due to exchange rate gain or loss is automatically managed in M3.

   As an outcome, Write-Offs and Cash discounts are recorded.

2. Match Invoice and Payment Records

   You can also manage the difference in the following ways:

   • Manually match existing credit invoice records or on accounts records
   • Manage unauthorized but accepted payment deductions made by the customer (debit notes)
   • Match invoice records to create a credit memo
   • Perform netting of invoice record against supplier invoice.

   As an outcome, Records Matched or Netted and Credit Memos and Debit Notes created.

3. Managing Non-adjustable Differences by Recording on Account

   Manage payments that cannot be entirely written off or allocated to an invoice for a customer by recording it on account for later allocation.

   As an outcome, Payment Registered for Prayer for Later allocation.