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Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / Credit Memos: do you h...
Microsoft Dynamics GP (Archived)

Credit Memos: do you have to apply them to documents

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Posted on by Community Member

Our AP is confused about how GP handles credit memos.  She applies them to the inovice, but the credit memo is not printed on the check, the invoice is simply reduced by the amount of the credit.  We have "All Documents" selected and "Print Previously Applied Documents on Remittance" Checked.  Is there a setting where you can just select the credit memo like an invoice without having to apply it.  This way the cm would simply show up as a separate line item on the inovoice?  We don't use GP for POs, as all PO's are generated out of our POS system. 

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  • L Vail Profile Picture
    L Vail 65,271 on at
    RE: Credit Memos: do you have to apply them to documents

    I thought the check stub I copied to a previous message would be just what you are looking for. Could you perhaps sketch up what you would want your check to look like using the numbers in my check stub, or any scenario you could describe?

    Kind regards,

    Leslie

  • Community Member Profile Picture
    Community Member on at
    RE: Credit Memos: do you have to apply them to documents

    Hi Leslie,

    What the vendors question is individual line items.  EX:  Invoice 1005 shows you are paying less than the full invoice amount.  If the credit was not against this (or any other) invoice, they ask why we're not paying it in full.  They understand once we explain the whole picture to them, but as they're entering their receipt they're typically going off of our "Net Amount Paid" column, which shows reduced invoice amounts and no credit amount.

    Thanks,

    Glen

  • Community Member Profile Picture
    Community Member on at
    RE: Credit Memos: do you have to apply them to documents

    Hi Leslie,

    Maybe it's semantics, and it sounds like we don't have a choice anyway, so we'll just continue as-is and field questions from vendors when they ask why.

    Here's my Norwegian thought process:

    Vendor Invoice 1 = $15

    Vendor Invoice 2 = $10

    Vendor Credit A = ($5)  (Credit totally unrelated to Invoices 1 or 2, or to any historical invoice, and it is not for a return of merchandise.)

    So we owe them $20 and cut a check.  We are paying Invoice 1 in full, we are paying invoice 2 in full, and we are taking the credit.  Check amount is $20.  We'd love for the stub to list all three independently.

    If we show the ($5) applied against Invoice 1 or 2 on the stub, they call and say "why did you not pay this invoice in full", and we walk them through to the net check amount.

    But I won't waste your time: if we can't do it, we can't do it.  Thank you for taking the time to review this issue with me.

    Glen

  • L Vail Profile Picture
    L Vail 65,271 on at
    RE: Credit Memos: do you have to apply them to documents

    Hi,

    I didn't apply the credit and then used the Select Checks method for building my payables batch. It did list the credit as a separate item. See below:

    check-stub.png

    Unfortunately the graphic is small, but the last line is a credit memo that I created.

    Kind regards,

    Leslie

  • L Vail Profile Picture
    L Vail 65,271 on at
    RE: Credit Memos: do you have to apply them to documents

    Glen,

    I have fully recovered and am happy to be back on the Forum. I plan to be there in Fargo. Thank you for asking.

    Regarding the thread, sorry I got the wrong module, but the same logic applies. If you have a floating credit from a vendor, how do you apply it? One of those invoices (or many) will not be fully paid. Are you thinking maybe to have the check stub show the original invoice amount and then separately list the credit that is being taken against the invoice? That makes sense to me anyway. I'm going to toy around with the Include previous docs, etc. checkboxes - and the timing of the apply.

    Kind regards

    Leslie

  • Community Member Profile Picture
    Community Member on at
    RE: Credit Memos: do you have to apply them to documents

    Hi Leslie,

    This thread, or at least my intent, was focused on the AP side and not client invoices/credits/payments.  Some AP credits we receive are completely independent of prior invoices from that vendor.  So when the system forces us to choose invoices to apply it to, it's confusing (and incorrect) on the check stub to our vendors because it looks like we're taking credit against an invoice that we are in reality paying in full.

    I'm sure "it is what it is", but I don't follow the logic.

    Thanks, and hope you are recovered and able to fully enjoy Fargo in September!

    Glen

  • Suggested answer
    L Vail Profile Picture
    L Vail 65,271 on at
    RE: Credit Memos: do you have to apply them to documents

    Hi Glen,

    I do not know why they elected to not let us have just a floating credit, but if you think about how transactions move into history, the credits must be fully applied. The truth is that the transactions were actually reduced because of the credit. What you are describing sounds like a balance forward customer - how would you clear an outstanding transaction that was reduced because the customer had a 'credit'. So long as you are keeping track of the instance and payment of each transaction, the credit would need to be specifically applied. If it weren't, it would look like the transaction had not been fully paid. I've been asked about this several times, but the logic always ends up with the fact that they paid less because of the credit. That credit needs to be spread between the outstanding balance using some method. No matter what, something needs to be applied to the invoice if you are tracking the individual documents.

    Kind regards,

    Leslie

  • Community Member Profile Picture
    Community Member on at
    RE: Credit Memos: do you have to apply them to documents

    Hi Leslie - do you know the logic behind that functionality?  We also do not use the GP PO system, and often have vendor credits that do not relate directly to specific invoices.  It confuses our vendors when unrelated invoices are reduced because of the auto-apply.  It seems like this would not be uncommon, and in all other systems I've used a "stand-alone" credit was the norm.  Are we approaching it incorrectly in GP?  Thanks.

  • L Vail Profile Picture
    L Vail 65,271 on at
    RE: Credit Memos: do you have to apply them to documents

    No

  • Community Member Profile Picture
    Community Member on at
    RE: Credit Memos: do you have to apply them to documents

    Is there a way to select a CM just like an invoice without having to apply?  

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