Invoice Installments in Netsuite
Back again is Plative’s principal NetSuite Consultant Larry Woo with some more tips and tricks with NetSuite and invoice installments.
I had a conversation with a long-time NetSuite client recently and we were discussing how they were setting up billing schedules and invoicing their customers. The longer the conversation went along, the more it became clear it wasn’t a billing schedule (issuing invoices at an agreed upon interval based on a single order) problem they had it was a payment problem.
Their need was that they invoice their customer in totality but allow them to pay this invoice at given intervals, essentially offering their customers to pay in installments. So what’s the difference between issuing out, for example, three invoices over time and a single invoice with three installments? The main difference is in the receivable.
If you use billing schedules, you only establish the receivable for the period that you create each invoice, say once in July, September, then October. With installments, the invoice is posted in July and then an installment schedule is created such that payments are due in July, September, then October. This allows the receivable to post entirely in July but your Aging is then calculated based upon the due date of the payment and the amount due at that installment interval (i.e July, September and October).
Required Setup for Invoice Installments
To enable this feature, Set-up→Enable Features→Accounting Tab
Under the Advanced Feature section enable “Installments”
1. Setting up Installment Term
This is not a new set-up list but rather it uses the existing Payment Term accounting list. With Installments enabled you’ll notice a few changes to the definition screen. Navigate to Setup→Accounting→Accounting Lists→Term (Type)–>New
The new fields of note are:
Installment: Check this box to indicate that this Payment Term triggers an installment payment
Recurrency Frequency: Select the frequency of payments
Recurrence Count: Enter the number of payments
Repeat Every: Indicate the repeat interval of payments
Split Evenly: Check this box to split payments evenly across all payments. Note that the first payment will also include any tax and shipping charges in addition to the evenly divided payment. If unchecked, you will need to define the payment amounts directly onto the transaction.
Pay Tax Upfront: To include the total tax amount with the first installment. If the Pay Tax Upfront box is checked, any shipping fees are split across the installments. However, the total of any shipping taxes is included in the first installment.
2. Add the Payment Term to a Transaction
Select the Installment Payment Term and you’ll notice under the billing tab that an installment list will be displayed based on the definition of your installment term. Note the header due date of this transaction will be set to the next installment due date and will be read-only.
At this point you can also Override Installments by checking the override box, this will allow you to modify the Installment list dates and amounts.
When a payment is accepted against this invoice (it will work with Vendor Bills as well), it will match against the first installment and update the status to paid or partially paid. If the customer exceeds the installment amount in their payment, it will be applied to the next installment automatically by the system.
A/R Aging without Installments on the Invoice:
Give NetSuite invoice installments a try, consult SuiteAnswers, and if you’re stuck don’t hesitate to contact one of our highly skilled NetSuite Consultants or email firstname.lastname@example.org