The Vendor Credit Memo (CM) document allows authorized users (by default, AP Processor role) to process vendor refunds for goods or services related to invoices processed on POs. You may process a vendor credit memo against a specific payment request, a purchase order, or a vendor ID.
Credit Memo Initiation
When you select Vendor Credit Memo the Credit Memo Initiation tab opens. This tab is used to specify the vendor credit memo number, date, and amount for the credit memo along with the number for a payment request, a purchase order, or a vendor in order to initiate the Vendor Credit Memo document.
An entry in one and only one of these three fields is required: Payment Request number, Purchase Order number, or Vendor number. These options do not determine how PREQs and CMs bundle. PREQs and CMs always bundle based on vendor and processing campus.
Click Continue button to initiate the vendor credit memo.
- If the vendor number and credit memo number match those of a CM previously processed, a warning notifies you of the potential duplicate. You may override the warning and continue.
- If the credit memo amount and credit memo date match those of a CM previously processed, a warning notifies you of the potential duplicate. You may override the warning and continue.
The Vendor tab allows you to modify the vendor address information via address lookup if the credit memo has been processed against a PO or a vendor. You may also add check stub notes on this tab.
A different address or customer number can be selected if the Credit Memo is initiated against a PO or a Vendor. The Customer Number displays if there is an existing Customer number associated with the vendor.
PO/Vendor Initiated VCM
PREQ initiated VCM
Credit Memo Info
The Credit Memo Info tab displays information pertinent to the current credit memo.
- The following fields are populated from the Vendor Credit Memo Initiation page:
- Credit Memo number from Vendor
- Credit Memo Date
- Vendor Credit Memo Amount
- Credit Memo Type
- The following fields are populated based on the Credit Memo Type
- Vendor #: populated regardless of Credit Memo Type
- Purchase Order #: populated if VCM is processed against a PO or PREQ
- Payment Request #: populated if VCM is processed against a PREQ
- PO End Date: populated if VCM is processed against a PO or PREQ
- PO Notes: indicates if there are notes on the PO and is populated if the VCM is processed against a PO or a PREQ
- The following fields are populated by the system:
- AP Processed Date: The date the vendor credit memo was submitted by Accounts Payable.
- Payment Method: Defaults to Check / ACH. In a future release, this will be a dropdown and will display Payment Methods that are allowable options as defined by the Payment Method table. For additional information, refer to Additional Payment Methods.
- Bank Code: The bank code will display when the BANK_CODE_DOCUMENT_TYPES parameter includes CM and ENABLE_BANK_SPECIFICATION_IND is set to Y. The default bank is determined by the Payment Method table if a default bank is specified for the selected Payment Method. If no default is specified in the Payment Method table, the Bank defaults to the value in the DEFAULT_BANK_BY_DOCUMENT_TYPE parameter. Parameter DEFAULT_BANK_BY_DOCUMENT_TYPE paramter must be completed even if Bank Offsets will not be used.
- Extract Date: The date the vendor credit memo was extracted to the Pre-Disbursement Processor.
The Process Items tab includes two sections, Items and Additional Charges
- identifies the lines of a specified purchase order or payment request that this credit relates to.
- indicates the dollar amounts to be credited to individual lines
- allows you to edit the accounting information associated with these lines.
- allows you to enter additional credits pertaining to items such as restocking fees or miscellaneous credits.
The makeup of the Items section varies based on whether the credit is being applied to a purchase order, payment request or vendor.
- If crediting by vendor, the Items section contains no fields and the Miscellaneous line in the Additional Items tab must be completed, including accounting lines.
- if crediting by PREQ, PREQ Quantity Invoiced and Unit Price display
- if crediting by PO, PO Quantity and PO Unit Price display
Items Section - VCM Processed against a PREQ
Items Section - VCM Processed against a PO
- Credit memos may only be processed on:
- items that have an invoiced open quantity, PO open quantities are incremented by the line item quantity on a credit memo when the Credit Memo is submitted.
- non-quantity items—invoiced dollar amounts remaining, PO open amount is increased by the line item amount when the Credit Memo is submitted.
Fields needing additional explanation are listed below:
- Credit Processed: Defaults to 0.00 and must be cleared in order to calculate the Credit (CM Qty x CM Unit Price). This will be fixed in a future release to not default. The reason that the Credit Processed does not calculate when there is a value in the field is to support credits that may not match exactly when calculated.
The Additional Charge lines that display are determined by parameter ADDITIONAL_CHARGES_ITEM_TYPES.
- Credit Processed: The amount of the credit. A positive amount increases the credit total. Whether or not a negative, positive or zero amount can be entered in the Credit Processed field is determined by the following parameters:
- Tax Amount: Displays when ENABLE_SALES_TAX_IND is set to Y and is calculated when the tax service is called. This field may be edited.
- Description: Required for item types in parameter ITEM_TYPES_REQUIRING_USER_ENTERED_DESCRIPTION.
- Total Amount: Display only. Credit Processed plus Tax Amount.
- Accounting Lines: Are populated from the Purchase Order if the Credit Memo is created against a Payment Request or Purchase Order. If the Credit Memo is created against a Vendor, the accounting line must be added.
- Accounts: When parameter SHOW_CONTINUATION_ACCOUNT_WARNING_AP_USERS_IND is set to Y, AP users are warned when one or more expired or closed accounts on a CM are replaced by a continuation account.
- Amount: The system re-encumbers amounts associated with each line item on a credit memo. The Amount encumbered follows the rules of PO encumbrance (CM Quantity x PO Unit Cost), which is similar to the payment request disencumbrance that utilizes the PO unit cost rather than the PREQ unit cost if the two unit costs are different.
- Object Code: The following parameters control allowable object codes:
View Related Documents
The View Related Documents tab collects information about PURAP documents related to this Vendor Credit Memo document. For example, it displays identifying information and any pertinent notes for the requisition, purchase order, receiving documents, payment requests, or other vendor credit memos associated with the purchase order.
View Payment History
The View Payment History tab tracks payment information related to the purchase order associated with this Vendor Credit Memo document. It shows pending payment information and updates indicating when a payment was processed through the Pre-Disbursement Processor (PDP). This tab also shows any other vendor credit memos that have been processed against the related purchase order and any associated payment requests. Fields needing more explanation are listed below.
- APAD Date: The date Accounts Payable submitted the credit memo.
General Ledger Pending Entries
- Credit Memos create the following entries:
- A set of Actual (AC balance type) entries to post the expense (debit) to the accounting string associated with the items credited on the Credit Memo and to establish the liability (credit) to an accounts payable offset defined in the Offset Defition table.
- If the Credit Memo was processed against a Purchase Order or a Payment Request, a set of Encumbrance (EX balance type) entries are created to increase the encumbrance.
- If the line item is quantity - the amount of encumbrance increased will be equal to the quantity invoiced times the PO item cost.
- If the line item is non-quantity - the amount of the encumbrance increased will be equal to the amount credited.
- Unlike other documents, the entries will post to the General Ledger next time the batch runs, regardless of the status of the document.
Canceling Credit Memos
If the Credit Memo is canceled , the G/L entries of the credit memo are reversed, any encumbrance created from AP approval of the credit memo are reversed, and any PO open quantities or amounts that were incremented from the creation of the credit memo are decreased.
- When a credit memo is processed against a payment request or a purchase order and the purchase order has been closed, the purchase order is reopened.
- A credit memo may be canceled or placed on hold at any time prior to extraction.
- When a credit memo is in AP-Processed status, it is eligible to be extracted to PDP for disbursement.
- The system groups all PREQs and CMs eligible for extract for disbursement as a positive payment based on vendor and processing campus.
- Only AP users may modify a CM’s check stub notes after AP submit and before extract.
The Vendor Credit Memo document is initiated by a member of the Accounts Payable Processor role. Routing is dependent on whether an image attachment is part of an institution's configuration.
- The document goes into Awaiting AP Review status if REQUIRE_ATTACHMENT_IND is set to Y. The AP Review status may be satisfied by an image attachment or in another fashion (configurable at your institution). After AP review, the document routes to the fiscal officer or fiscal officer delegate as an FYI. At the AP Review routing level, approvers are not permitted to change content on the document. They may only add notes and attachments and approve or cancel.
- The document routes an FYI copy to the fiscal officer associated with each account number that appears on the vendor credit memo.