When a payment amount exceeds the open invoice amount, a part of the payment remains unadjusted. The exceeding amount can either be adjusted to a different invoice for the same payer, converted to an advance payment, posted to a separate bookkeeping account or refunded to the customer. 

Adjustment to another invoice

If the customer has another open invoice to which you would like to adjust the payment, do as follows:

First register the entire payment:

1. Go to the Financial Management > Payments folder.
2. Click New > Payment.
3. Fill in the payment information to the Payment window.
   • NOTE! In the Payment Amount field, enter the total amount paid by the customer.
4. Save the payment.

Next, make a payment adjustment to the first invoice:

1. In the payment, go to the Adjustments folder. 
2. On the ribbon, select New > Adjustment.
3. In the next window, find the customer’s invoice via the magnifying glass in the Invoice field.
4. Select the invoice and click OK.
5. The open amount of the selected invoice is automatically added to the EUR field. If needed, you can manually change the amount before saving.
6. When saved, the amount is adjusted to the invoice.

Now, you can make the next adjustments by selecting New > Adjustment.

• The EUR field in the adjustment window always shows how much of the payment is still unadjusted.

Converting payment to an advance payment

An overpayment can also be converted to an advance payment to ensure that it will be used for the customer’s next invoice.

1. In the payment window or payment list, select Open Amount to Advance on the ribbon.
   
2. Select the temporary account through which you wish to convert the original payment as a posting to a new advance payment.
3. Also provide the registration date for the posting and the advance payment.
4. The system creates an advance invoice to which the advance payment is automatically adjusted.

The Advance Payment and the Advance Payment Amount are displayed in the original payment.

Posting to a bookkeeping account

In case the customer does not have other invoices to which the exceeding amount could be adjusted, and the remaining unadjusted sum is too small to be refunded to the customer, you can post it to a bookkeeping account meant for overpayments. 

1. Open the Payment window > Adjustments folder.
2. Select New > Posting to open the posting window opens.
   
3. Enter the amount to be posted and select a suitable credit account for overpayments.
   • If there is no suitable account, click the magnifying glass and then the ‘New’ button at the bottom of the window to add a new bookkeeping account. 
4. Save the posting.
    

Making a payment refund

A third option for overpayment processing is to return the excess to the customer. Depending on the situation, you can create a payment refund for the payment or for the invoice.

If you have registered the whole payment into the software, and a part of the payment cannot be adjusted to any invoice nor converted into an advance payment, do the following:

1. Go to the Financial Management area > Payments folder.
2. Select the “Unadjusted Payments” view and select the payment you want to create a refund for.

3. Select the Create Payment Refund function on the ribbon, fill in the entry date and debit account for the refund and select OK to save.

   

The unadjusted amount of the payment will be posted, and the payment will no longer be listed in the Unadjusted Payments view. Note that entries made in the software do not move money, so you need to make the actual payment refund via your bank.

If the invoice has already been paid and a partial or full credit invoice created for it, you cannot create a payment refund to the payment, since it has been totally adjusted. But since the open amount for the credited invoice will be negative, you can create a payment refund on the invoice. Make the payment refund as follows:

1. Open the invoice you want to create the payment refund for.
2. Select the Create Payment Refund function on the ribbon.
3. Fill in the credit account and entry date for the refund. If for some reason you don’t want to refund the whole negative amount you can change the refund amount.
4. Select save and close. The payment refund corrects the open amount of the invoice to zero, and the payment refund entry is displayed in the Payment List report.