How to Reverse an AP Invoice

Overview

Reversing an AP invoice may be necessary when an invoice was entered incorrectly, applied to the wrong vendor, or needs to be adjusted. There are two methods to reverse an AP invoice: using a Journal Entry or creating a Credit AP Invoice to offset the original invoice.

Method 1: Reversing an AP Invoice Using a Journal Entry

1. Locate the AP Invoice

• Navigate to the AP Inquiry program.

• Search using either the Vendor Number or the Invoice Number associated with the AP invoice.

• Locate the invoice entry and review its details.
  

2. Review the Journal Entry

• Open the GL Inquiry program.

• Search by the journal number associated with the AP invoice.

• Review which accounts were affected to ensure the reversal is processed correctly.
  

3. Create a Reversing Journal Entry

• Open the Journal Entry program.

• Create a new journal entry using the same accounts affected by the original invoice, but reverse the amounts.

• Enter the Vendor and AP Invoice # on the Accounts Payable detail of the journal.

• Enter a description indicating that this journal entry is for reversing an AP invoice.

• Post the journal entry to complete the reversal.
  

4. Verify the Reversal in AP Inquiry

• Open the AP Inquiry program.

• Search for the Vendor Number or Invoice Number associated with the original AP invoice.

• Confirm that the reversal has been applied correctly and that the AP balance reflects the intended adjustment.
  

Method 2: Reversing an AP Invoice Using a Credit Memo

1. Create a Credit AP Invoice

• Navigate to the AP Invoice Entry program.

• Create an AP Credit Memo for the same vendor.

• Enter the same amount as the original invoice but as a negative value.

• Save and post the credit memo.

2. Apply the Credit Memo to the Original AP Invoice

• Open the AP Inquiry program.

• Search using the Vendor Number.

• 

• Locate the Credit Memo.

• In the Apply To # field, enter the original AP Invoice number.

• Click on the checkmark to apply the credit memo against the original invoice.
  

3. Verify the Application of the Credit Memo

• Once applied, the credit memo and the original invoice will offset each other, reducing the vendor’s outstanding balance.

• Confirm that the AP balance reflects the intended adjustment.
  

Key Considerations

• Reversing an AP invoice does not void the payment if the invoice was already paid. Additional steps may be needed.

• Always verify the journal details in GL Inquiry before making adjustments to prevent discrepancies.

• If the invoice needs to be re-entered differently, ensure the new AP invoice is entered correctly after the reversal.