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Banking & chart of accounts: Reconciliation

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Reconciliation - Allow credit notes to show and be selected on the find & match screen

Ability to show and can select credit notes on the find & match screen.

Purpose: To save time rather than having to go in and allocate the credit note against an invoice then going back to the bank reconciliation screen.

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AdminXero Team (Admin, Xero) shared this idea  ·   ·  Report…  ·  Admin →
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In development  ·  AdminKelly Munro (Community Manager, Xero) responded  · 

Hi community, thanks again for all the support and very honest feedback you’ve shared on this idea over the years.

We appreciate the manual steps to apply credits are time consuming, especially if you’re managing large volumes of these on a regular basis.

We'd like to share that we've now developed functionality that allows Xero to suggest relevant unpaid credit notes as matches when you’re reconciling. We’ll be releasing this feature slowly to all users over the coming weeks.

You’ll also be able to find and select Credit notes using Find & Match - Just make sure you tick "Show Received Items" (for spent statement lines) or "Show Spent Items" (for received statement lines) so the credit note appears in the list.

When you select a Credit note to Reconcile, Xero will create a cash refund against the credit note (rather than allocating the credit to a specific invoice automatically), instead of requiring you to set this up separately first.

Front footing here, we know this solution won’t yet cover all the scenarios customers have asked; for example, overpayments and prepayments, and including credit notes in bill payment batches are still out of scope for this phase - We’ll continue to monitor feedback to help inform where we take this next, so please do continue to share through Xero Product Ideas and the ideas I’ve linked above.

As this becomes available in your business, you’ll see a message within Xero highlighting the new behaviour and where to find credit notes in bank rec.

Once this is available to 100% of customers, we’ll come back to update everyone here and provide more detail to help with understanding exactly how it works, and making the best use of this feature.

Thank you again for your patience, persistence, and for sharing real examples of how this impacts you, they’ve been critical in shaping what we’re delivering here.

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  • Rebecca Tomlinson commented  ·   ·  Report

    Fantastic, look forward to it being implemented :) Although first idea of it was in 2012 so not sure how quickly this will happen ....

  • Rebecca Tomlinson commented  ·   ·  Report

    Bank reconciliation - would be very helpful to be able to match credit notes and invoices from this screen using find and match when matching bills and bank payments instead of having to either go into the credit note and apply credit or the invoice and use the credit note before reconciling in the bank account.

  • Shona Bol commented  ·   ·  Report

    I find it annoying that you have to always allocate a credit note to an invoice. Why can't you "pick up" a credit note when allocating a payment from a customer, the same way as you can "pay" an invoice. Why do you have to allocate it to an invoice first?

  • Bee Hesketh commented  ·   ·  Report

    Good to hear that this is finally in development. Will we be able to allocate credit notes to future repeating invoices? It feels like repeating invoices are always forgotten about when it comes to development.

  • Carole Mail commented  ·   ·  Report

    Well its took over a decade to get from an idea to working on it so by the time its in operation i will of retired!

  • Gill Izen commented  ·   ·  Report

    Thank you. We really need this. We issue credit notes that don't relate to specific invoices - but have to allocate them to a random invoice which makes everything so messy when looking back at records. Can't wait!

  • Rhonda Zlatanovski commented  ·   ·  Report

    AMAZING! Thank you!

    This will help so much.

    Also, AP credits to be available as 'refunds' on the bank reconciliation would also be a life saver!

  • Sean Huxley commented  ·   ·  Report

    Glad to hear, finally.

    It also needs to apply to the 'make payment' option in awaiting payments.

  • Alice Mason commented  ·   ·  Report

    yeah, it was about time... we can't wait ;) please please, i know we can mark them as refunded and they'll show on bank recon, but that's a proper nigthmare... it should be automatic... prepayments, overpayments, credit notes... thank you

  • Bee Hesketh commented  ·   ·  Report

    Will this development include allowing us to allocate credit notes to repeating invoices as well?

  • Paul Swinton commented  ·   ·  Report

    After over 12 Years since I created the original thread on this, I'm glad to see it is finally getting looked at!

  • Kyle Stutter commented  ·   ·  Report

    I'm stoked the devs have decided to work on this!

    I also agree with the others. Having to manually allocate credit notes before preparing a batch payment to a bunch of suppliers or reconciling a bulk payment from a customer is time-consuming and slows down what is otherwise a relatively quick and streamlined workflow.

    The manual step can also be prone to human error, especially when a customer or supplier has lots of credit notes to be allocated.

    For this reason, we dread working with clients whose business model means they have lots of credit notes to deal with.

  • Sarah Verge commented  ·   ·  Report

    I agree with Claire and Luke. It's important that, when setting up suppliers' payments, it's possible to select both the outstanding invoices and credit notes. Currently, credit notes have to be allocated against random invoices first, which means that it's not possible to produce a remittance advice showing which credit notes have been used or why there's an underpayment on some invoices. This is basic functionality.

  • Luke Abbott commented  ·   ·  Report

    Agree with Claire.

    Suppliers often ask us why we have randomly allocated a CN against an unrelated invoice on the remittance rather than just taking it as a credit against the whole payment. Only Xero users appear to have encountered the forced invoice allocation of credits.

  • Claire Barning commented  ·   ·  Report

    Hi Kelly, can you please also add to the scope of this - the ability to select credit notes when setting up a creditors payment. So that way the remittance actually matches the payment, instead of having to allocate all credit notes against invoices (whether they are relevant or not).

  • Jason Greenwood commented  ·   ·  Report

    Why would this NOT be the default in Xero? It is SO infuriating to have to figure out a workaround for this...

    I always dread trying to reconcile credit notes as I never seem to be able to do it the right way.

    Why should these be different to any other type of reconciliation?

    Boggles the mind...

  • Zahid Mustafa commented  ·   ·  Report

    On the bank reconciliation screen you cannot allocate a bank payment (or receipt) to a credit note when there are also several invoices to pay. I believe you have to allocate the credit note to an invoice before going back into the bank rec screen and allocating the payment. This is quite long winded.

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