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Process Spotlight: Vendor Prepay

Just like how most of your customers pay you prior to being invoiced, there are times of the year where you may need to pay a vendor before you receive an actual invoice from them. Below outlines the steps we recommended to complete this process.

Setting Up Vendor Prepay (Chart of Accounts)

If you haven’t already, you will need an account for Vendor Prepay in your Chart of Accounts. Do to this, go to System Settings → Chart of Accounts. Scroll to the bottom of the portal and enter a New Account for Vendor Prepay.

Create a New Check

A new check can be created through the Add menu or through the Transaction tab on the Vendor Detail page.

  • Enter the date for the check.
  • Go to the Expense tab and press the + button.
  • Enter your Vendor Prepay Account and amount you wish to Prepay.
    • Optionally, enter the department and any notes.
  • Save the Transaction.
  • Repeat the process, starting with the + button, as many times as needed.

Print the Check or Mark as Printed

To assign a Check or Transaction Number you need to either print or mark the check as printed.

  • Open the Hamburger Menu and select option.
  • You will be prompted to enter in the starting check number.
    • If you are sending via ACH, you can enter a text designation. Press continue.
  • If you selected Print, follow the printing steps.

After printing, please confirm that the check printed correctly and exit using the back logo.

Create a Vendor Credit Memo (VCM)

Create a Vendor Credit Memo under the Add menu or the Transaction tab of the Vendor Detail page.

  • If the Add menu option was used, assign the Vendor.
  • Set the date on the VCM to match the date of the check issued.
    • VERY IMPORTANT NOTE: Change the account FROM Accounts Payable TO Vendor Prepay.
  • Complete any notes or additional information desired.
  • Go to the Accounts tab and press the + button.
  • Enter the Vendor Prepay Account and the amount issued on the Vendor Prepay check.
  • Optionally, enter the department and any notes.
  • Repeat the process, starting with the + button, as many times as needed.

Please verify that both accounts on the VCM reflect Vendor Prepay. Exit the Memo using the back logo.

Applying the Vendor Credit Memo

When you receive an invoice from a vendor that you’d like to use this

Prepay against, follow the steps to create a bill (these steps can also be found under the Create a Bill video). The open VCM can be found under the Transaction tab on the Vendor Detail page or from any detailed version of the Accounts Payable Report.

  1. Open the VCM by clicking on the number.
  2. Open the Hamburger Menu and select Apply Credit.
    1. Note: All open Bills should be reflected under Apply Credit Memo.
  3. Select the bill to apply against.

The total open amount should automatically apply. If you only want to apply a partial amount, you can override the default by clicking in the Amount to Apply field and entering the desired value. Exit using the back logo.

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