The whole process of advance payment processing

Hello everyone,

Some of the raw materials we purchase are advanced payment methods.
But, I had to figure it out myself because there was no procedure or training on the advance payment processing process.
The entire process of processing the advance payment as I understood it is as follows. Could you please let me know if what I have figured out is correct or if there is a process that needs to be added?

  1. Purchase Order Entry : Create a purchase order
  2. AP Invoice Entry : Create an advance payment AP invoice with that PO
  3. Payment Entry : Create a payment with that advance payment AP invoice
  4. Receipt Entry : Create a Receipt when the raw material is actually received
  5. AP Invoice Entry : Create an AP invoice with that Receipt (Put the previously created Adv Invoice into the Ref Invoice field)
  6. Apply Debit Memo / Prepayment (I’m not sure if this is required or not)

I’d really appreciate it if you could let me know if I’m misunderstanding something.

I am more familiar with the AR side, but it sounds similar.

Step 3 is not required at this point, it can be done at a later time.
During Step 5, the balance from the Advanced should reduce the amount for the Receipt Invoice.
Step 6 does not apply here.

So basically after this workflow, you would have 2 AP Invoices, one Adv Bill and a Receipt, how you pay them it is up to you.

The process for Prepayment, which is different from Advance Billing, as I understand it is like this:

  • Create Misc Payment and mark it as Prepayment in Payment Entry, this creates a debit memo.
  • After the Receipt AP Invoice is posted you can use Apply Debit Memo/Prepayment. (Not sure if the Ref Invoice field would also work here)

Like I said, I’m used to this process on the AR side mostly and only as a developer, so the actual business process might be different.

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Thanks for your reply. May I ask you a few questions?

  1. “During Step 5, the balance from the Advanced should reduce the amount for the Receipt Invoice” - How do you handle this?
  2. After listening to your words, I think I can do the Payment Entry in Step 3 directly without the AP Invoice Entry in Step 2. Is that right?
    I would appreciate it if you could teach me.

On the AR Side, when you generate the shipment invoice, lets say for $500, if you have an advance billing for the Sales Order for say $100, the invoice is automatically generated for $400.
I assume it is similar to AP, but I could be wrong, be sure to test it.

Yes, although one is a “Prepayment” and the other is an “Advance Billing”, I guess it depends on each companies specific process, how you receive the money from the supplier, and based on that which one to use. Test both and choose the one that aligns better with your company.

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I am a bit late to the party but have been trying to put the same process down on paper and trying it out. I have done exactly what you have done in the steps that you have taken but I find that when I get to creating the final invoice for the receipted goods Epicor tells me that the Adv Pay is automatically populated with the sum of any advance payments but this is not the case in my example as the field although enabled is empty. I ran a BAQ and the PODetail.AdvPayBal (which is apparently where the figures comes from) does indeed show the advance payment balance but Epicor does not bring it onto the invoice detail screen and if I enter it manually it is not accounted for in the group edit list which makes me think I am missing a step somewhere.

@GMerrey Here is the KB that we follow and has worked for us. KB0071598

If you search EpicCare there are a lot of KBs on this subject.

Thanks Greg - that is the exact method I am following but the advance payment is not showing in the less adv pay field. I will try again and document each step before submitting a case to support as I am obviously doing something wrong.