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Overview

Invoice Reconciliation is the process of creating Invoices, matching Transactions, and handling Refunds for a Business. It ensures the correct bookkeeping entries are made for outstanding, paid, and voided Invoices, while helping Business owners clearly see earned revenue and cash still to be collected.

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Working with Invoices in Asset

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1. Create an Invoice

  1. Call the Create an Invoice endpoint.
You can use the Customer Credit Balance Report to check available credits for a customer before creating an Invoice. This lets you apply credits immediately to reduce the amount due.
  1. Asset automatically creates a Journal Entry to record earned revenue:
    • Debit Accounts Receivable
    • Credit Sales Revenue (selected Ledger)

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2. Match Payments to an Invoice

  1. Call the Create Transactions endpoint to create a new Transaction in Asset. Alternatively, use a Transaction that already exists.*
  2. Call the Apply Transaction to an Invoice endpoint to match a Transaction to an Invoice:
    • If the Transaction amount is less than the Invoice amount, additional Transactions can be applied later.
    • If the Transaction amount is greater than the Invoice amount, the extra amount can be applied to another Invoice. If not, Asset records the excess as Customer Credit.
  3. Asset creates a Journal Entry to record the payment date.
  4. Once the sum of matched Transactions is greater than or equal to the Invoice amount, the Invoice status updates to paid.
*Asset attempts to automatically match Transactions to Invoices based on description, amount, and date.

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3. Refund an Invoice

  1. Call the Refund an Invoice endpoint.
Do not manually update the Invoice status to refunded or partially_refunded. The status updates automatically when you call the Refund an Invoice endpoint.
  1. Refund rules:
    • Partial Refund: You must provide the line ID being refunded. Asset sets the Invoice status to partially_refunded.
    • Full Refund: When the Refund amount equals the Invoice amount, the status updates to refunded.
    • Refunds cannot exceed the Invoice amount (the system returns an error).
  2. The refund_credit field specifies refund type:
    • True → Creates a Customer Credit Journal Entry (Refund completed).
    • False → Creates a Journal Entry increasing Accounts Payable (Refund pending).

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4. Match Payments to an Invoice Refund

  1. Call the Create Transactions endpoint to create a new Transaction in Asset.*
  2. Call the Apply Transaction to a Refund endpoint to match a Transaction to a Refund:
    • If the Transaction amount is less than the Refund amount, additional Transactions can be applied later.
    • If the Transaction amount is greater than the Refund amount, the excess can be applied to another Refund. If not, Asset records the extra as Uncategorized Outflow.
  3. Asset creates a Journal Entry to record the payment date.
  4. Once the sum of matched Transactions is greater than or equal to the Refund amount, the Refund status updates to completed.
*Asset attempts to automatically match Transactions to Refunds based on description, amount, and date.
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