How to Reverse a Vendor Invoice in Sage 100

Understanding Invoice Reversal Scenarios

Before initiating an invoice reversal, it's important to determine your specific situation. There are two main scenarios when reversing vendor invoices:

Scenario 1: The invoice has been entered but the check hasn't been issued Scenario 2: The invoice has been paid and requires both check and invoice reversal

Reversing an Unpaid Invoice

When dealing with an unpaid invoice that needs to be reversed, follow these steps:

1. Navigate to Modules > Accounts Payable > Invoice Data Entry.
2. Enter the Vendor Number and Invoice Number of the original invoice.
3. When the Invoice Adjustment popup appears, click the "Adjust" button.
4. Enter a negative amount in the Adjustment Amount field that matches the original invoice amount.
5. Post the Invoice Register to complete the reversal.

Reversing a Paid Invoice

If the invoice has already been paid, you'll need to perform a two-step process:

Step 1: Reverse the Check

1. Go to Modules > Accounts Payable > Main > Manual Check Entry.
2. Enter the bank code associated with the original check.
3. Input the check number you want to reverse.
4. When prompted "Is this a check reversal?", select Yes.
5. At the "Recall original invoices?" prompt, select Yes to reopen the original invoice.
6. On the Lines tab, verify the negative amount displayed matches the original check.
7. Click Accept to proceed.
8. Print the Manual Check Register and update it.

Step 2: Reverse the Invoice

After reversing the check, proceed with the invoice reversal:

1. Access Accounts Payable > Invoice Data Entry.
2. Enter the original vendor number and invoice number.
3. Use the Invoice Adjustment feature to enter the negative amount.
4. Post the Invoice Register to complete the process.

Special Considerations

Job Cost Integration

When your Accounts Payable module is integrated with Job Cost, additional steps are required:

1. The system will notify you that Job Cost invoices have been recalled.
2. Manual distribution of these invoices will be necessary.
3. Ensure all job cost allocations are properly reversed.

GL Distribution Method

If you choose not to recall original invoices during check reversal:

1. Access the Lines tab in Manual Check Entry.
2. Select the GL Distribution Button.
3. Enter the appropriate GL Account.
4. Input the original check amount as a negative value.

Best Practices

To ensure accurate invoice reversals:

Documentation: Maintain detailed records of all reversals, including reasons and supporting documentation.

Timing: Process reversals in the same accounting period as the original transaction when possible.

Verification: Double-check all amounts and account numbers before posting.

Audit Trail: Keep a clear audit trail by using consistent reference numbers and descriptions.

Common Issues and Solutions

Multiple Checks with Same Number

If you encounter multiple checks with the same number:

1. The system will display a Check Reversal List.
2. Select the specific check you need to reverse.
3. Click the Select button to proceed.

Outstanding Balance Issues

If you notice outstanding balances after reversal:

1. Verify all steps were completed correctly.
2. Check the vendor account for any remaining transactions.
3. Review the GL Distribution to ensure proper posting.

System Requirements and Updates

For Sage 100 2020.1 and later versions:

A new Reverse Check Run utility is available in the Accounts Payable Utilities menu for subscription users. This feature allows for:

• Reversing entire check runs
• Processing multiple checks simultaneously
• Handling both standard and electronic payments

Electronic Payment Reversals

For electronic payments:

1. Select Accounts Payable Main menu > Manual Check and Payment Entry.
2. Choose "Electronic Payment Reversal" in the Payment Type field.
3. Follow the standard reversal procedures as outlined above.

Reconciliation Steps

After completing the reversal:

1. Review the vendor account to ensure the balance is correct.
2. Verify GL account balances are accurate.
3. Update bank reconciliation records if necessary.
4. Document the reversal in your accounting records.

Professional Considerations

When performing invoice reversals:

Consultation: Consider consulting with a certified Sage 100 ERP consultant for complex reversals.

Training: Ensure staff members are properly trained on reversal procedures.

Backup: Always maintain current system backups before processing significant reversals.

Authorization: Implement proper authorization procedures for invoice reversals.

Conclusion

Reversing vendor invoices in Sage 100 requires attention to detail and following the correct sequence of steps. Whether dealing with unpaid or paid invoices, proper execution of these procedures ensures accurate financial records and maintains the integrity of your accounting system. Remember to document all reversals thoroughly and maintain proper authorization protocols throughout the process.

By following these comprehensive guidelines, you can confidently manage invoice reversals while maintaining accurate financial records in your Sage 100 system. Regular practice and familiarity with these procedures will help streamline the process and reduce the likelihood of errors.

Citations: [1] https://www.caserv.com/2018/11/29/sage-100-how-to-reverse-a-check-and-invoice-in-accounts-payable/ [2] https://www.rklesolutions.com/blog/sage-100-reverse-checks [3] https://www.ardentconsultingllc.com/resources/reverse-wire-transfer-and-reissue-wire-transfer-in-sage-100-a-step-by-step-guide [4] https://www.youtube.com/watch?v=PRUqchfu3Uk [5] https://www.top-sage-resellers.com/blog/sage-100-reverse-check [6] https://communityhub.sage.com/us/sage100/f/core-financial-modules/69295/reversing-a-check-and-deleting-an-invoice [7] https://help-sage100.na.sage.com/2022/Subsystems/AP/APMainProced/Reverse_an_Electronic_Payment.htm [8] https://www.acutedata.com/sage-100-how-to-reverse-ap-checks/