Overpayment

When you add a payment it has to be fully allocated to one or more invoices. It cannot 'float' in the system with the company who paid considered to be in credit.

If you receive a sum of money from a company that is greater than the amount that they owe for an invoice, there are several ways to handle this.

The simplest solution is to enter the correct invoice payment amount in Case Manager and handle the return of the extra payment amount separately in your accounting software.

If you don't want to do this, you need to be aware that Case Manager prevents you overpaying an invoice. To get around this, first create a temporary adjustment to increase the invoice.

Thus, to manage an overpayment accounting issue completely in Case Manager:

• Add a temporary adjustment to bring the invoice total up to the full payment received.
• Create a payment transaction for the amount received and linked it to the invoice.
• Delete the temporary adjustment.

The invoice is now overpaid, i.e. the amount of money owed for the invoice is a negative number.

• Create a refund transaction for the excess payment amount against the invoice. This is a positive amount.

This transaction records that money effectively moves out of your business and hence, increases how much money is owed for the invoice.

However, it does not affect the invoice's costs or the tax totals.

• Return the excess amount back to the company as a cheque, or equivalent.

As an example, if the invoice is for $990 and the sum of money received is $1000:

• An invoice adjustment is added for $10.
• A payment of $1000 is entered against the invoice.
• The $10 invoice adjustment is deleted,
• A refund transaction is added for +$10.
• $10 is mailed or transferred back to the company.

invoice	990
add adjustment	10
payment	-1000
delete adjustment	-10
refund	10
Net value of invoice Net received for invoice Amount owing for invoice	$990 $990 $0

Overpaid invoices

Note that if you do overpay an invoice by any means (e.g. you do not add the refund transaction in the scenario above) the invoice has a negative amount owing.

Overpaid invoices appear in reports as unpaid (amount owing is not equal to zero) so that you are made aware of them and can rectify the situation.