Credit Memo issue

[Former Member]

Hi,

I want to know the following things

1) Can I create a credit memo / debit memo after the customer has paid the amount ?

2) In my current client, I can't cancel an invoice.Due to some techncal error, I have to cancel an extra invoice in production. So, I am thinking of creating a credit memo request against that invoice.In this case, my question is that if I create a credit memo request with reference to the Invoice (and its subsequent credit memo) then how will it affect the financial transactions?

Basically,I want to understand the difference of creating a credit memo instead of cancelling a billing document?

[Former Member · Accepted solution]

Hi Ronaldo

Even after the customer has paid, you can create a Credit memo safely.

In fact, it is better to create a Credit memo instead of canceeling the billing document.

If you want to cancel a billing document then you have to take the approval of the FI department as the customer has already paid for it. Beside this there may be some problem of closing period etc.

But, you can avoid those by creating a Credit memo for the required amount.

There are two situations for creating a Credit memo.

In your organisation, either you may be following a Release procedure or you may not.

If you are following a Release procedure, then first you have create a "Credit memo request" with ref to either the Billing document or Sales order(can also be created without any reference).

From this Credit memo request, you can create the Credit memo.

If your organisation does not follow Release procedure then you can create the Credit memo directly from the Billing document.

[Former Member · Accepted solution]

But in my case the customer has already paid the amount.

So do I need to reverse the Amount that is posted and then create a credit memo ?

Or I can directly create a credit memo wrt the billing document.

However in that case since the customer has already paid so wouldn't it create a problem? The amount is already cleared and when I cretae a credit memo then what about that amount?

How will system handle that amount as the customer is not going to pay me for the credit memo amount?

[former_member217082 · Accepted solution]

Hi ronaldo

If the customer has paid also, you can create a credit memo with reference to billing document.If you have done some credit to customer means then if he does another transaction you can reduce that amount as customer has already paid complete amount in the previous transaction

Say for example you have given a credit memo of Rs.10000/- and later on when customer has raised a sales order and the payer has to pay Rs.25000/- then FI consultants can reduce that Rs.10000/- and then the customer has to pay only Rs.15000/- only

Regards

Srinath

[Former Member · Accepted solution]

You can still issue a Credit memo even if the customer has already paid.

Craete a "Credit memo request" with reference to Billing document or Sales order in VA01 and order type CR.

Go to chage mode of it in VA02, remove the "billing block" by chossing the blank space in overview screen and save the Credit memo request.

Now, create a Credit memo with reference to this Credit memo request.

Once the Credit memo is created a corrosponding Accounting document will be created which you can see in the Document flow.

When money is given/credited to the customer, the accounting document will show as cleared.

[Former Member]

Hi Ronaldo,

If you find any thing wrong in invoice you can cancel the Invoice by using T.code VF11 . Once it is done it you observe the document flow you can find the canceled accounting document along with the canceled invoice.

Since your business does not allowing you to cancel the invoice you can finely create a credit memo to that customer instead of canceling the invoice.

You can create a credit memo with reference to an existing billing doc or with ref to existing order or with out any reference also.

So you can create a credit memo using a credit memo request order type. When ever customer placing order in future he can claim that credit memo and he can get that amount deduction in the next billing.

Eventhough your customer paid for received goods,still you can issue a credit memo to him.It is simply depends on the understanding between the customer and the business.Nothing more than that.

Regards,

Revan

[Former Member]

Hello,

As the invoice/accounting document is cleared, you may create a Credit memo with reference to the invoice. Otherwise create a credit memo request with reference to the invoice and a credit memo with reference to the credit memo request.

If you reverse the invoice, the preceding document will get open, that is the delivery document. If the invoice is created in previous months and reversal in current period may get affected.In case of credit memo this issues will not be there.

Prase

[former_member315051]

Hi

1) Ans : You can very well create Credit Memo / Debit memo request w r t invoice.

2) Ans : What error eacatly you are getting while cancelling invoice , if you create a credit memo customer account will get credited, revenu accounts will get debited.

if any more finacial transactions you require then consult with your Fi consultant , he can help you ..

Hope this will helps

Regards

Ramesh

[Former Member]

Thanks Ramesh.

I am not getting any error as such in cancelling the document.

But generally, the business doesn't allow us to cancel an Invoice. So, I want to know if I create a Credit Memo instead then what other transactions will it hit and how feasible is this soultion?

[former_member315051]

Hi,

if client dont want to cancel the inovice , you can create credit memo , for this i have mentioned accounting entry in the above thread.

Hope it helps

Regards

Ramesh.