To re-instate the invoices that were paid by a cheque that has subsequently been dishonored, an entry via the Cash Entry program is made using Payment type classified as a cheque but with a negative cheque amount (100.00-). The Payment type can be given a code to differentiate between a cheque payment and a dishonored cheque entry. This negative cheque is then allocated to the invoices that were originally paid, reinstating the invoice balance. If running the Bank Reconciliation facility, the fact that the Payment type was a cheque means it will be picked up when matching the Bank statement to the Bank account entries in the Bank Rec file.
| Note | If the Dishonored cheque is processed via the Bank Reconciliation facility prior to the customer account being rectified, the entry on the customer account needs to be a journal so that it does not go through to the Bank Rec File. |
- In the menu, expand Base Modules > Distribution > Debtors & Claims > Accounts Receivable > Entry and then double-click Debtor Cash/Journal Entry. ARE005 Cash Entry payment selection panel appears.
- On the Payment function field, select CSH from the drop down list and click OK.
- Enter the required details on the header panel, with Document type = ‘CHQ’ and negative cheque amount.
- Click OK. ARE005 Cash Entry detail panel appears with the invoice listing.
- Click the invoice for which payment is being reversed and click the Pay option to place a Y in this field.
- Enter the allocated amount. It must be negative to cancel the cheque.
- Ensure the Auto adjustment flag is ‘N’
- Click OK to enter the bank reference details on ARE210 Bank reference – Charge panel.
- Click OK to process the payment.
