Background: AP Payment Reversal

Use the AP Payment Reversal (NVC) program to void payments for reconciliation purposes, reverse payments posted to the general ledger, and print the AP Payment Reversal Register. See Road Map for work flow.

This topic has these subtopics:

Void Checks

You can void pre-numbered checks that are not usable. For example, you can void the number of checks used for forms line-up.

When you void a check, the program sets it to type V and updates the void date. When you print the Outstanding Transaction Listing (NBO) and a check was voided on a date after the cutoff date you select, the check still prints on the listing with the void date.

Voided checks are identified on the Disbursement Report (NMD).

Reverse Payments

You can reverse a check or payment after you have run the AP Payment Register (NCR) program. You may need to do so if you issued the check by mistake or if the vendor never received it. The program makes adjustments to the cash and AP accounts to reverse the payment.

The program gives you several options:

• Reinstate invoice for payment: The next time you run the Vendor Payments (NC) program, you can select this invoice for payment. When you reinstate an invoice, the system creates a journal entry that debits the cash account and credits the AP posting name set up in the Posting Criteria Maintenance (XPC) program.

• Reinstate invoice and place on hold: Vendor Invoice Payments does not list this invoice for payment until you change the Pay/Hold field with the AP Invoice Maintenance (NM) program.

• Cancel invoice: Use this option if you issued a payment by mistake for an invoice you do not plan to pay. The system considers the purchase order line and receiver to be paid. The AP Inquiry (NI) program displays Invoice cancelled in NVC in the Reference column for this invoice.
  
  When you cancel an invoice, the system creates a journal entry that debits the cash account and credits the corresponding expense or asset account. The AP Payment Reversal Register prints a detail and summary GL distribution listing, and depending on the GL posting options established in the System Options Maintenance (XM) program (GL Journal Options), the transactions may be posted in summary or detail to the GL.

Restrictions

Because the reversal process requires information from the payment and invoice to update the correct GL accounts, there are some restrictions on the types of transactions that you can process in the AP Payment Reversal program. The program displays an error message if you try to:

1. Reverse or void a check that has already been voided.

2. Reverse an on-account payment.

3. Void a check that has already been reconciled.

Preview and Final Register

When you print the AP Payment Reversal Register, these documents print in this order:

The register includes this information:

• GL organization code

• GL account number

• Payment number

• Void
  Manual: Reversal of a manual check
  Reg: Reversal of a regular check

• Void/Reversal date

• Authority

• Payment amount

The register also includes this information for a reversal:

• Vendor number

• Reinstate/Cancel option selected: Reinstate, Reinstate on Hold, or Cancel

• Invoice number

• GL organization code for invoice

• Account number

• Account description

• Invoice amount

• Total payment

It includes these totals:

• Total payable

• Total discounts

• Total currency exchange

• Total 1099 withholding tax

• Total payments

Register Updates

If you need to make corrections, do not enter PROCEED for the If the register is correct, enter PROCEED to update prompt. Make the desired changes in the AP Payment Reversal program and then run the AP Payment Reversal Register again. When you approve the register, it performs these functions:

Void Checks

• Updates the check with a "void" status. The check appears as such on the Disbursement Report (NMD).

Reversed Payments

• Removes the payment from bank reconciliation.

• Subtracts the payment and any discounts taken from the vendor's total year-to-date payments and discounts. If an invoice is reinstated, the vendor's AP balance increases by the invoice amount; if an invoice is canceled, the YTD invoice total for the vendor decreases.

• Deletes 1099 detail if this is a 1099 vendor.

• Decreases the total payments-to-date for the contract if the check was applied to a fixed expense invoice.

• Deletes the payment record.

• Retains the payment record, but updates the status to "void" or "reversed."

• Updates the invoice(s) paid with the reversed payment with a new status of Hold, Pay, or Canceled.

• Creates adjusting entries for posting to the general ledger.

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