Customer Adjustments

Customer adjustments are used to increase or decrease a customer balance by affecting another account. For example, if you needed to charge a customer interest, you could process a customer adjustment to increase the customer balance and affect an Interest Received account.

When you are working with customer adjustments, you will work with VAT in the same way you do when processing customer invoices – you always enter VAT at the point of the original transaction and the customer balance will always be increased or decreased with the VAT inclusive amount. For customers, you enter original transactions via customer invoices (and returns), or via customer adjustments. In both these processes, you enter VAT codes along with the transactions. When you receive payment from customers, you do not enter VAT.

  • Click on the Customers…Transactions…Customer Adjustments option.
  • The following screen will be displayed:
  • Click on the Add Customer Adjustment button.
  • The following screen will be displayed:
  • Select the customer from the Customer drop down menu.
  • Select whether you are increasing or decreasing the supplier account.
  • Select the By Affecting account.

By Affecting is the “other” account affected when you post a transaction.

The principle of accounting dictates that every debit should have a credit. In other words – every transaction affects at least two accounts. A main account and a contra account. The contra account is referred to as the by affecting account.

In an example of a Customer Adjustment you would affect the Customer (or Accounts Receivable) but the by affecting account would be the other ledger account affected by the adjustment for example Interest Received.

  • Enter a description for the adjustment in the Description field.
  • Select the date when the account is adjusted in the Date calendar look up field.
  • In the Unpaid Invoices section select the invoice that you want to adjust.

An increase adjustment cannot be allocated to unpaid invoices.

  • Select the Process button to save the adjustment that was made.

Adjustments using the Customer Adjustment Quick Entry Grid

  • You also have the option to do customer adjustments using a Quick Entry Grid:
  • Enter all the customer adjustment information in the respective fields.
  • Click on the Process button to save the customer adjustments.

Customer Opening Balances

If your opening balances were recorded incorrectly, you can use this feature to rectify the balances on your customers.

  • Click on the Customers…Special…Adjust Opening Balances option.
  • The following screen will be displayed:
  • Select the customer that must be adjusted in the Customer field.
  • Enter a reason and the new opening balance in the respective fields.
  • Select the date when the opening balance must be effective at.
  • Click on the Save button.

If the opening balance period falls within a closed VAT period or a locked financial year, you will not be able to adjust the opening balance.

It is recommended that you seek professional advice from an accountant or auditor before adjusting your opening balances.