How To: Cancel a Credit Note
Table Of Contents
- WARNING: Credit Notes can only be deleted if they have NOT been issued. If they have then you will have to create balancing sales orders and / or credits in order to balance the customer's account.
There are several reasons why you may need to cancel a credit note. For example, the wrong Sales Order type may have been selected when the order was created, or a return credit may have been raised by mistake.
The process you follow depends on whether the credit note has been issued.
Unissued Credit Notes
If the credit note has not been issued, it can be cancelled directly from the credit note.
Cancel the Credit Note
- Find and open the credit note.
- Click Delete to remove the credit note.
- Enter a cancellation reason and click OK.Note: By default, a free-text cancellation reason is entered manually. Alternatively, you can select a reason from a predefined list maintained in
System Data | Cancellation Reasons.Predefined cancellation reasons require custom development and may incur additional charges. - Click Yes when prompted to confirm the cancellation.
View Cancelled Credit Notes
You can view previously cancelled credit notes using the audit report.
Display the Cancelled Credit Notes Report
- Open a Sales Order screen (show me how).
- Open the Other Actions menu by:
- Pressing F9, or
- Clicking the drop-down arrow next to the green circle with the white cross icon on the toolbar.
- Select Audit.
- Select Legacy Audit.
- In the Audit Dialog, click the Cancelled Sales Orders Report button.
- Select the required date range.
- Click OK.
- When prompted for the order type, select Credit Notes.Note: Select Cancel if you want to view cancellations across all order types.
- The Cancelled Orders Summary report will be displayed.
Issued Credit Notes
Once a credit note has been issued, it cannot be cancelled directly. Instead, the recommended approach is to create an invoice in the SP Ledger and allocate the incorrect credit note against it.
Create an SP Ledger Invoice
- Open the [ Accounts | SP Ledger ] tab.
- Press Alt + E or click Edit.
- Press F3 or click New.
- Use the lookup window to find the customer associated with the incorrect credit note.Note: Use the Supplier checkbox to switch between customers and suppliers.
- Select the customer. A new row is added to the grid.
- Enter the following details:
| Field | Value |
|---|---|
| Post | Ticked |
| Pay | Unticked |
| Crd | Unticked |
| S/P | Enter S |
| Nominal | Enter the nominal account to post against |
| InvDate | Enter the invoice date |
| Tax | Exempt |
| Gross | Enter the value of the incorrect credit note |
| Description | Enter a note explaining that the invoice has been created to offset an incorrect credit note |
Note: If you enter today's date as the invoice date, a warning message may be displayed.
- Press Ctrl + S or click Save.
- Acknowledge any warning messages and complete the save.
Allocate the Credit Note Against the Invoice
After creating the SP Ledger invoice, allocate the credit note to clear both transactions.
- Open a Customer screen.
- Find and load the customer.
- Open the Statement tab.
- Drag the credit note from the Allocate From grid and drop it onto the SP Ledger invoice in the Allocate To grid.
The issued credit note will now be allocated against the balancing invoice, effectively reversing the original transaction.
Additional Information
- Unissued credit notes can be cancelled directly.
- Issued credit notes cannot be cancelled and must be offset through the SP Ledger.
- Cancellation reasons are recorded for audit purposes.
- Cancelled credit notes can be reviewed later using the audit reporting tools.