KB Corner: Fixing Misapplied Payments and Credits

August 2017    Tags: Credits, Payments, Reports, Resources, Tabs3 Billing

You run an Accounts Receivable Report only to see clients or figures you weren’t expecting. Other reports, such as a Client Ledger Report, may show a client owes you a different amount or nothing at all, but Accounts Receivable tells a different story. Why is this, and how can you fix the issue?

When payments and credits are misapplied, Accounts Receivable reports can show unapplied payments, negative due values, or both. But what are misapplied payments and credits?

• Misapplied payments are payments that have been entered but were unable to apply. Most often this occurs when a payment is entered specifically as a fee payment and there are either no fees or not enough fees for the payment to apply to, or the payment is entered as an expense/advance payment and there are no expenses/advances or not enough expenses/advances for the payment to apply to.
• Misapplied credits occur when a credit is entered and there is nothing to apply the credit toward. Credit transactions only apply toward fees or costs for which payments have not yet been applied. Once a payment has applied toward a transaction that has been final billed and updated, credits entered after that can only apply when a new transaction of the same type as the credit is entered.

To determine whether unexpected figures in Accounts Receivable Reports are caused by misapplied payments, credits, or both, visit Knowledge Base Article R11673, “Fixing Misapplied Payments and Credits.” This article provides information on determining the cause and how to fix both issues.

Our Knowledge Base can be accessed 24 hours a day, 7 days a week, at support.Tabs3.com.  You can also access our Knowledge Base while in the software by selecting Help | Internet Resources | Knowledge Base.