Entering Supplier Rebates
Entering the various discounts, rebates and adjustments that may flow to you from your suppliers varies according to the circumstances.
Price or GST Correction
If price of an item has been reduced or increased or if the supplier has incorrectly charged GST or not charged GST:
- Reverse the original purchase;
- If accounting for GST on the cash basis and if the purchase has already been paid, reverse the payment also;
- Enter a new purchase with the new value/tax status;
- If accounting for GST on the cash basis, re-enter the payment and apply it to the new purchase.
Usually it would be most appropriate to use today's date for a price correction unless you have specific reasons to back-date it.
This process should be used even if the supplier has simply issued a single credit note with a generic value on it to represent a price decrease. It is most useful for your analysis if the value is assigned to the proper stock codes.
Finder's Fee, Commission, Advertising Rebate, Product Rebate
These are normally considered to be income to you, although the supplier may grant the amount to you by way of a credit against your account. In this instance the supplier is really generating a Recipient-Created Tax Invoice:
- Create an invoice for the value of the fee (if necessary, create a dedicated stock code and analysis code to represent the income type);
- If the supplier has sent a cheque or direct deposit, enter the receipt;
- If the supplier has passed a credit to your account, use the Transfer Wizard to apply the invoice to outstanding purchase(s).