11.12. Advance Payments

In SocrateCloud, the business partner cash advances functionality can be treated in four different ways:

• Order registration (sales/purchase) + payment/receipt through the cash journal;

• Automatic cash advance fiscal invoice registration + cash advance closed by allocating it to a final invoice;

• Proforma registration (purchase/sales order) + the payment/receipt;

• Manual registration of the cash advance fiscal invoice;

Advance Payment by Cash

1. Enter the order for which the advance is paid:

• depending on the transaction type, access the Sales Order or Purchase Order window;

• on the document master enter the business partner data

• on the document details, enter the ordered products;

• complete the order

• details in Sales Orders, Purchase Orders.

Accounting Posting:

The Sales/Purchase Order is posted with 0 value, so that it does not influence the balances.

2. Enter the Advance Payment:

• open the Cash Journal window and enter a new line;

• select Cash Type = "Order"

• select the order for which the advance is paid;

• enter the advance amount;

• details in Cash Management;

Accounting Posting:

Advance Receipt: Debit: 5311 Lei Cash Journal

Credit: 419 Customer Credit

Advance Payment: Debit: 409 Vendor Debt Credit: 5311 Lei Cash Journal

When completing the cash journal, the cash journal line will become available for allocation.

3. Close the advance

• enter the invoice based on the order entered above;

• allocate the cash payment to the invoice, using the Matching Cash Invoice window. Details in Allocations;

Accounting Posting:

Matching Cash-Customer Invoice: Debit : 419 Customer Credit Credit: 4111 Customer Receivables

Matching Cash-Vendor Invoice: Debit : 401 Vendor Credit: 409 Vendor Debit

Advance Invoice (automatically)

An advance invoice is registered when a advance has been paid for an order.

1. Enter the order for which the advance is paid:

• depending on the transaction type, access the Sales Order or Purchase Order window;

• on the document master enter the business partner data

• on the document details, enter the ordered products;

• complete the order

• details in Sales Orders, Purchase Orders.

Accounting Posting:

The Sales/Purchase Order is posted with 0 value, so that it does not influence the balances.

2. Register the advance payment:

• • By cash:

    • • open the Cash Journal window and enter a new line;

      • select Cash Type = "Order"

      • select the order for which the advance is paid;

      • enter the advance amount;

      • details in Cash Management;

  • by bank account:

• • • open the Payment window;

    • select the order for which the advance is paid;

    • enter the advance amount;

    • complete the payment;

    • details in Payments;

Accounting Posting:

Cash Advance Receipt: Debit: 5125 Amounts under settlement(*5125- intermediate/transit account)

Credit: 419 Customer Credit

Cash Advance Receipt-Invoice Allocation: Debit: 419 Customer Credit

Credit: 411 Customer Receivables

*Bank Statement- detailed- advance receipt: Debit: 512 Bank Account

Credit: 5125 Amounts under settlement

3. Press the Generate ProForma Invoce button on the cash line or payment to generate the advance invoice. Before running the process you can specify the following parameters:

• Document Type - document type used for the generated invoice. The document type should have the following properties:

  • Base Document Type = "Proforma"

  • Central Document "AR Invoice"

• Charge - used on the advance invoice lines to register the advance (the charge must have Proforma checked when defined)

• Document Action - determines the document status for the generated invoice;

The advance invoice can be viewed by pressing the Zoom Across button from the toolbar and can be found, depending on the transaction type in the Invoice (Customer) or Invoice (Vendor) window and will have the same amount as on the advance payment.

Accounting Posting:

Cash Advance Fiscal Invoice: Debit 411 Internal Customers

Credit 419 Customer Debt (revenue account defined at Charge-Advance level)

Credit 4427 Collected VAT

4. Generate the final invoice, the shipment and close the advance

• the advance will be automatically closed when generating the final invoice;

• the final invoice and shipment are generated based on the order, useing the processes provided by SocrateCloud;

• the final invoice will contain the ordered products and a linte through which the advance s closed, with the following properties:

  • Qty = -1;

  • Charge - charge used to register the the advance;

  • Price = amount on the advance invoice;

Accounting Posting:

Customer Final Invoice: Debit 411 Internal Customers

Credit 7xx Sales Revenue

Credit 419 Customer Debt (negative value- advance reversed)

Credit 4427 Collected VAT

Advance through Proforma

This is used when registering and advance paument without any document or through a proforma.

1. Enter the "Proforma Order"

• depending on the transaction type open the Purchase Order or Sales Order window;

• on the document master check Proforma and enter the business partner information;

• on the order details enter a product or expense type through which the advance is registered;

• details in Sales Orders, Purchase Orders.

Accounting Posting:

The Sales/Purchase Order is posted with 0 value, so that it does not influence the balances.

2. Register the Advance Payment

• • open the Payment window;

  • select the order for which the advance is paid;

  • enter the advance amount;

  • complete the payment;

  • details in Payments;

Accounting Posting:

Advance Receipt:

Debit: 5125 Money to be clarified

Credit: 419 Customer Credit

3. The advance payment can then be allocated to the invoice for which the it was paid. Details in Allocations.

Accounting Posting:

Matching invoice-payment/receipt:

advance value:

Debit 419 Customer Credit

Credit 411 Customer Receivables

difference value (balance) :

Debit 4731 Money to be discounted, unallocated receipts

Credit 411 Customer Receivables

Advance Invoice (manually)

This method is used when you want to manually register an advance invoice.

1. enter the advance invoice:

• depending on the transaction type open the Invoice (Customer) or Invoice (Vendor) window;

• on the invoice details enter the product or expense type used to register the advance;

• complete the advance invoice;

• details in Vendor Invoice, Customer Invoice;

Accounting Posting:

Debit 419 Customer Debt (the account corresponding to the advance product)

Credit 411 Customer Receivables

2. Close the advance:

• depending on the transaction type open the Invoice (Customer) or Invoice (Vendor) window to register final invoice for which the advance was registered

• on the invoice details, in addition to the invoiced products, enter a line through which the advance is closed, with the following properties:

  • Qty = -1;

  • Charge - charge used to register the the advance;

  • Price = amount on the advance invoice;

  • complete the final invoice.

Accounting Posting

Debit 7xx Sales Revenue

Credit 411 Customer Receivables

and, at the same time, cash advance reversal:

Debit 419 Customer Debt

Credit 411 Customer Receivables