Payments
Policy
FIACCT 05-10_01 Payments – Payment document credit memo
Effective: July 1, 1994
Revised: January 1, 1997
Reviewed: July 1, 2018
Purpose
This policy establishes the method for entering vendor credit memos.
Background
Credit memos represent money owed to the government by the vendor. They are entered in FINET as a
decrease at the time a payment that exceeds the amount of the credit memo is being made to the vendor.
Policy
Payment documents can be used to record credit given to Agencies because of overpayment or returned
goods. If cash is actually received from the vendor in lieu of credit, it should be recorded on a cash receipt. Credit Memos should be entered on a payment document only when there is a payment due to the vendor that exceeds the amount of the credit. Credit Memos will be recorded with a decrease line. If a
Credit Memo cannot be used by the Agency within 60-90 days, the Agency should request a cash refund
from the vendor.
Procedures
Responsibility
Action
If Agency Takes Credit on Payment Document
Department
Code the payment document as follows:
Mark the “New” button for document action.
The prior document reference fields must be blank.
Use an appropriate accounting distribution, including an appropriation and object code. Discount type must be blank.
The line amount is the amount of the credit.
Mark the “Dec” button.
The vendor must be indicated by a vendor code or vendor name.
Follow all other steps as outlined in the Vendor Payment transaction policy.
If Agency Cannot Take Credit on Payment Document
Department
Contact vendor to request cash payment for credit.