--- title: "Manual Processing - Processing Credit Notes" canonical: "https://kb.myframeworks.com.au/space/PROSTIXV48DOC/31099906/Manual%20Processing%20-%20Processing%20Credit%20Notes" format: markdown --- This procedure explains how to raise credit notes for stock purchases that either do or do not match up with a return/credit request, and process credit notes through CIA when they are received from the supplier. A Credit Note reverses the General Ledger movement that occurs when a creditor's invoice is approved, effectively reducing the amount that is owing to a supplier because goods have been returned or invoiced at an amount that differs from the cost on a purchase order. It should match up with a Return/Credit Request that has been previously been applied to stock. If the credit note is not processed in the same accounting period that the goods were returned, the Purchases Clearing Account has a debit/credit in different periods. Refer to the following processes for further information: Raising a credit note To raise a credit note, perform the following: 1. A Credit Note is processed in the same way as a Creditors Invoice is approved. That is, f rom the ProStix Main Menu select ' Purchasing & Receipting ' then ' Creditors Invoice Approval ', select the required company, then select (New Batch). Do not use the (New Credit Note) option. 2. The Return/Credit Request is created with a ' Purchase Order ' number. Once you have selected this number, choose option ' Receipt Details ' to confirm the amount that being processed against the amount that was applied to stock when the Return/Credit Request was originally created. 3. Confirm that the Invoice Header is titled ' Stock Return ' to ensure you are processing the correct type of approval. 4. Type a negative amount into the ' Invoice Amount' field, otherwise you are increasing the amount owing to the nominated supplier (unless the pre-defined tolerances prevent you from adding the transaction to the batch). 5. A GST Amount appears after the ' Invoice Amount ' is typed. Remember, this credit note is a reversal of the creditor's invoice entry. When the creditor's invoice was processed, GST would have been added to this amount so the credit note should also include GST to reverse the original invoice transaction. 6. Add to Batch, Complete and Post as per a normal Creditors Invoice Approval transaction/s. New Credit Notes The (New Credit Note) option does not match up a Return/Credit Request with the Credit Note being processed, and is used when a Supplier has sent you an 'unidentified' credit note. That is, one that you cannot relate back to a specific purchase order. The system tailoring flag ' InvPurCred ' determines whether this function can be run from 'Creditors Invoice Approval' as it is really a Transaction Processing function. To process a new Credit Note, perform the following 1. From the ProStix Main Menu select ' Purchasing & Receipting ', then ' Creditors Invoice Approval ', select the required company (if applicable), then select (New Credit Note) , not . 2. After selecting the period to post and the supplier, the 'Credit Note Details' screen is displayed. U pdate the fields. Refer to the ' Credit Note Details fields ' collapsible link below for a screenshot and an explanation of these options. 3. After completion of the Credit Note, the GST figure appears, and the figures show as negative amounts. 4. You are prompted for the G/L allocations. 5. Once completed select (Add to Batch) to close, then complete and post as per a normal Creditor's Invoice Approval transaction. Refer to Creditors Invoice Approval for further information. Credit Claims When the Credit Note is received from the Supplier the Claim is then ready to be processed via the CIA process. When you select a Return for approval that has an associated claim, you are warned that the return is Subject to Credit Claim nnnnn (where nnnnnn = the credit claim number). The Credit Note can then added to the batch as normal. All regular postings occur with the addition of the following: