Creating Refunds without VAT

Customers: 

Go to AR > Customer Refund.

Suppliers:

 Go to AR > Supplier Refund.

Banks: 

1. Go to Bank Accounts.
2. Click on Unprocessed Imported. Find your Bank Transaction.
3. Click Create New Posting > Create Customer Refund or Create Supplier Refund.

Creating Refunds with VAT

If you need to account for VAT on refunds, use:

• Supplier Debit: Go to AP > Item Invoices > New Debit Note. See Creating Purchase Item Debit Notes‍.
• Purchase Batch run: Go to AP > Batch Invoices > New Batch Debit Note. See Creating Batch Purchase Item Debit Notes‍.
• Customer Credit Notes: Go to AR > Item Invoices > New Credit Note. See Creating Sales Item Credit Notes.‍ 
• Sales Batch run: Go to AR > Batch Invoices > New Batch Debit Note. See Creating Sales Batch Credit Notes 

Types of Refunds

Supplier Refunds posts a Purchase Credit Journal which:

• Increases the selected Supplier Balance
• Credits the Supplier Control Account
• Debits the selected bank account 

Customer Refunds posts a Sales Debit Journal which:

• Increases the selected customer's balance
• Debits the customer control account
• Credits the selected bank account. 

How to Post a Refund

In the Refund screen, complete the following:

• Customer A/C / Supplier A/C: Enter the customer or supplier name or account code.
• Exch. Rate: If you select a foreign currency Customer, Supplier, or Bank Account, the rate will default to the latest for that Account's Base Currency. However, you can override it if necessary.
• Refund Date: This defaults to today's date, but you can override it.
• External Reference: Enter a mandatory journal reference number. The refund transaction will not post if it is missing. This reference is used during the bank matching process of the bank reconciliation.
• Bank: Select the Bank Account from the list if you need to post an adjustment to a GL Account, use Sales or Purchase Debit, or Credit Journals.
• BI Code: If required, select a BI code.
• Description: Enter a Description for the journal. This field is mandatory.
• Refund Amount: Enter the refund amount in the customer or supplier currency.
• BC Amount: This is calculated automatically for foreign currency Customer, Supplier, or Bank Accounts. 

To finish, do one of the following:

Supported FX Refunds

The following scenarios are supported:

• Customer/Supplier in the same foreign currency as the bank
• Customer/Supplier base currency with the bank in foreign currency
• Bank in base currency with Customer/Supplier foreign currency

Unsupported FX Refunds

You cannot do the following: 

• Process foreign currency triangulation in refunds, where both the Customer/Supplier and the bank are in foreign currency. Instead, process the refund in two stages:
  1. Process a sales debit or purchase credit journal.
  2. Process a bank debit or credit journal.
• Post refunds from the Bank Transaction matching screen if the Customer/Supplier is not in the same currency as the Bank Account as the transaction may carry bank charges. You will receive an error message if you try. 
• Match a single bank transaction to multiple transactions using the Bank Transaction Matching. You need to manually match them in the Bank Reconciliation screen.

To create Foreign Currency refunds:

1. In the relevant listing grid, find your transaction. In the Actions dropdown, select Create Refund.
2. Complete all necessary details. In the Refund screen, the BC Amount field will be calculated automatically.
3. Click Process.

What’s the difference between Sales Debit Journals and Customer Refunds, or Purchase Credit Journals and Supplier Refunds?