Correcting Past Invoices

Pyn

We recently discovered that an invoice from 7 years back was recorded $0.50 less than the invoice amount but full invoice amout was paid at that time (becasue of direct debiting). Since it is not advisable to change the original invoice now, I wonder if there are ways to get rid of the $0.50 balance that is stuck with this supplier? 

 

I know it is only $0.50 but it is quite annoying every time we check the balance with this supplier. 

 

Appreciate any help. 

Steven_M

Hi @Pyn 

 

It is probably something that you want to have a discussion about with your accounting advisor in regards to the best way to handle that situation going forward. Generally speaking, as that transaction is dated so long ago you would not be able to make changes to it to clear that balance so you would not be able to update the purchase and probably have to deal with it in the current financial year.

 

Personally, the way I would deal with it as it's such a long amount is to generate a debit note for that supplier (enter a negative purchase). Once that has been generated, apply that to the purchase to close it off. 

 

An alternative way would be to record a payment on that account with a holding bank account being used rather than a bank account this would close that purchase. You could then record a journal entry to another account to clear that holding account if necessary.