Hai. I think debit note & credit note can be assigned to creditor or debtor in order to make changes. This is because sometimes we have shortage or overpaid. We can’t issue new invoice. Its wrong. In order to set things right. We have to use debit or credit note. Currently the software only can use credit note for customer n debit note for supplier.
If you cannot reissue the invoice with an increased invoice amount you can issue a new adjustment invoice that refers to the adjustment of the original invoice or try issuing a negative credit note.
@tony A negetive credit note is unprofessional.
Can one send a negetive invoice?
A credit note would be used in place of a negative sales invoice.
Yes. Im totally not agree with that. Adjustment should be made using credit or debit note. We can’t simply re-issue the invoice. That is totally wrong. Because once you already send an invoice, the contract its already there. To make an amendment, we must use credit or debit note.
You cannot issue a negative sales. Its totally wrong.
If you issued invoice number 100 for the incorrect amount of $500 but it should have been invoiced for $550, I expect that you can issue invoice number 101 for $50 referring to the amount undercharged in invoice number 100.
You have to understand the concept of contract. An invoice is an agreement of acceptance. If you already issued 100 unit for $500. The changes should be under debit debit note to customer. In the debit note you should mention undercharged amount. From the previous invoice. But if, you overcharged 100 unit for $600. You should issue credit note to knock off the $50 from the invoice.
@tony that is true, but it get complicated when tax authorities come in. When they want every record including gross sales, tax collected number of sales transactions etc. In my country, it is clearly stated in the VAT law that tax invoices will be adjusted (upward or downward) with only a credit and a debit note (Tax Credit Note and Tax Debit note). This helps in the correct counting of actual sales and number of sales and allows the tax payer to avoid penalties on delayed tax payment etc.
Credit note is not limited to customers and neither is debit note limited to suppliers. They could be used for so many things
Yes. This is why i’m here… because we i can’t do an adjustment on my account.
Why? According to who? That is exactly what a credit note is, but with a different title.
No, it is not. A sales invoice is is a demand for payment that is the result of a contract, whether written, verbal, or implied. There is nothing from an accounting perspective to keep you from issuing multiple invoices for goods or services, effectively dividing the invoice into installments.
Use a credit note for the downward adjustments. Give a new title to a sales invoice used for an upward adjustment if you (or the authorities) do not like making the adjustment with a second sales invoice. See Create sales invoices | Manager.
The document title change won’t flow into the general ledger or customer statements. It just a document title change.
@Abeiku, given that a debit note created against a customer is financially indistinguishable from a sales invoice, how would authorities react to a note in a custom field citing the local regulation and stating something like, "This transaction constitutes a tax debit note under the meaning of XXXXX, Section YYY?
We can’t simply issue a negative sales or negative receive of bill. Goods received note should follow the amount of goods you received accordingly. No such thing as negative receive. Thus, amendment should be made using debit or credit note. Debit note is not specified for customer while credit note is note specified for supplier. They can be used both side. Either debtor or creditor. Please refer back to International Financial Reporting Standards IFRS for more details.
@iszza93, if you issue a negative-quantity sales invoice and are using delivery notes, you would not issue a goods receipt for a returned item. You would issue a negative-quantity delivery note. This functions correctly in Manager and keeps proper track of both amounts invoiced or received, as well as quantities going out and back in.
In other words, if they are used, credit notes and delivery notes go with sales invoices. And debit notes and goods receipts go with purchase invoices. Other than concerns about titles, which can be modified, there is no need for further capabilities in Manager.
The manager already have that capability to do that. The only problem is, debit and credit note are restricted to certain item only. Thats the only issue. Back to your explanation, to buy goods you have to open a Purchase Order. Then the supplier will sent you the goods together with the Delivery Order and invoice… Documents in the DO and Invoice must equal. When the customer received the goods, when there are shortages or extra. The customer should use Debit or Credit Note in order to inform the supplier. This is the correct work flow.
No, you do not. A purchase order has no financial impact in Manager. And why did you suddenly shift to discussing purchases? You have been discussing adjustments to customer’s sales invoices via various transaction types.
I am sorry, but the idea that a customer can use transactions in its own accounting system to notify a supplier of anything simply is not logical. Yet that is what you seem to be saying.
The issue is, how you are to balance up in the system if the quantity or the amount in the invoice is wrong either from supplier or customer. So adjustment must be made using debit or credit note. Debit or credit note are not restricted certain thing. We can’t simply issue a negative value invoice. Purchase doesn’t make any changes. Yes you are correct. But in when you received goods using Goods Received Note (GRN) you must follow the purchase order amount. If there is variance between the amout. We have to notify the supplier. Using credit note or debit note.