About inline credits

An inline credit is a negative line item in a AP purchase invoice. The way inline credits are applied and used depends on configurations in your company.

Automatically apply inline credits

As a best practice, select to automatically apply inline credits in Accounts Payable. This means that an inline credit is automatically consumed within the AP purchase invoice. Any remaining credit can be applied to any AP purchase invoice as a supplier credit on the Pay AP purchase invoices page.

However, if your company is not configured to automatically apply inline credits, any inline credit is not applied within the AP purchase invoice. Instead, it becomes available to apply to any AP purchase invoice as a supplier credit on the Pay AP purchase invoices page.

Reserve inline credits for application in the owning entity

You can configure your company so that inline credits are reserved strictly for application in the owning entity. This eliminates the need to generate inter-entity transactions to account for credits applied to the wrong entity.

When your company is configured to limit Accounts Payable credits to the entity owners, you can add negative inline credits only when each line item is for the same entity. If you need to enter AP purchase invoices that include line items for multiple entities as well as negative inline credits, deselect Limit AP credits to the entity owners. When your company is configured to limit Accounts Receivable credits to the entity owners, you can add negative inline credits only when each line item is for the same entity. If you need to enter AR sales invoices that include line items for multiple entities as well as negative inline credits, deselect Limit AR credits to the entity owners.

Inline credits that net the AP purchase invoice to zero

Creating inline credits that net the AP purchase invoice to zero? Any inline credits created across locations are automatically consumed within the AP purchase invoice, regardless of company configurations.

For example, you create a AP purchase invoice with two line items: A line item for your San Francisco location for £100 and a line item for your New York location for: £100. Because the AP purchase invoice nets to zero, the inline credits automatically apply and are consumed within the AP purchase invoice.

Inline credits are applied using the waterfall method, where the credit is applied top-down, consuming the maximum amount per row until the credits are completely consumed.