Introduction

A credit note or credit invoice is used to correct a sales invoice that has been processed or when items from a sales invoice have been returned. The financial transactions created from the credit notes will be displayed in the debtor card and general ledger card. These transactions will be displayed in the debit or credit column in positive or negative amounts based on the transaction subtype and the subadministration type of the general ledger account.

The transaction subtypes for financial entries in the reversal entry functionality are redefined for invoice lines with negative amounts and credit note lines with an increase in the amounts from the original invoices in line with local financial reporting practice. 

Menu path

• Invoice/Entries/Invoices
• Invoice/Entries/Print/Process

What has been changed

As a prerequisite, the Reversal entry setting under the Entry section in General ledger settings must be enabled and the changes are applicable only to the Invoice module for the China legislation. The changes refer to the financial entries created for the VAT general ledger account (G/L), Revenue G/L, and Debtor G/L. The changes will affect the transaction subtypes used in the financial entries created for the following:

• sales invoice or direct sales invoice lines with negative amounts.

• credit notes or direct credit notes created to indicate an increase in amounts from the original invoices.

The following are the changes implemented during the final processing of a credit note:

• For negative amounts in the sales invoices or direct invoices, the transaction subtype for the negative invoice line transaction is changed to Reversal credit note from Sales invoice.

• For credit notes or direct credit notes, the transaction subtype for the invoice line transaction where the amounts exceed the original invoice is changed to Sales invoice from Reversal credit note.

The transaction subtypes can be viewed at the debtor card or G/L card as shown in the example below.

Related document

• Creating Credit Notes Based on Invoices
• Creating and Maintaining Credit Notes