[GNC] Vendor Refund - Best Practice

[Adrien Monteleone]

I can’t speak to legal or tax requirements, but logistically, you can issue a Credit Note ‘from’ the vendor for the difference, then process one final ‘payment’ on the bill but instead of entering a payment amount, simply select the bill and the credit note. (which should be the same absolute value) They will offset to zero. The bill will show paid and your AP will be reduced accordingly.

To issue the credit note, start a new bill for that vendor, but choose the Credit Note radio button at the top of the Bill creation window. (where you put the opening date, vendor, document #, terms, etc.) If you’ve hit the line-item entry screen, you missed it and went too far. (and can’t delete that bill, you’ll just have to re-use it later)

Document as needed in the Notes, or line-item(s). Post the Credit Note when you’re done, then use Process Payment as noted above to do the offset.

While you could un-post/edit/re-post, a credit note will reflect reality, rather than changing the original accounting.

I only un-post to correct minor data entry errors. (some accountants even frown on that, but I don’t have legal requirements otherwise)

Regards,
Adrien

> On Apr 9, 2020 w15d100, at 3:03 PM, M <M_Stagl at hotmail.com> wrote:
> 
> I'm not very familiar with the Business functions of GnuCash and have been experimenting with them.  I'm looking for a "best practice" and how to accomplish this in GNC:
> 
> I am treasurer for a non-profit PTA.  We issued a grant to the school.  Over time the school would use the grant and I would make payments to the school.  At the end of the year, the school did not use the entire grant.
> 
> I first created a Vendor (the school) and a Bill (as if we owed the school) for the amount of the grant.  Each month, I would make a payment on this bill as the school used our grant money.  I did this so we could show the entire amount of the Grant as an Accounts Payable and thus not accidentally use the money during the year on other things.
> 
> I am stumped how to end this scenario.  The school will not use the entire grant.  I imagine this is similar to a scenario where I owed money to a vendor, but that vendor "wrote off"  or discounted a portion of my obligation after the original bill was issued. Should I un-post and modify the original bill?  Can I create a second bill with a "refund" to offset the unused portion?
> 
> I would love to know how others handle this.
> 
> Thanks in advance,
> 
> Mike