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Debit notes and Credit notes play a huge role in proper Accounting management. With the Accounting module, you can easily manage Debit notes and Credit notes.

What is Credit Note : A Credit Note is a document that a seller issues to a buyer to inform them that credit has been credited to their account. A seller can provide a credit note when a customer needs to cancel all or a portion of an invoice for several reasons. Credit Note is also known as Credit Memo, which is a letter sent by the seller to the customer advising the customer that they have been credited a specific amount because of an error in the original invoice or other reasons. 

There are several reasons that can lead to a credit note, such as:

  • A mistake in the invoice.
  • A return of the goods, or a rejection of the services.
  • The goods delivered are damaged.

What is Debit Note : Debit note is issued by Buyer (Customer) to Seller (Vendor) while returning the product process. And Seller (Vendor) has to issue Credit note on behalf of that Debit note issued by Buyer (Customer). It is a commercial document that a buyer sends to a seller.

If I explain in simple words if a seller-provided item in bulk to a consumer, the buyer was responsible for the entire cost. As a result, the transaction was completed. However, the consumer can return the merchandise to the seller for any reason. In such circumstances, the seller issues a credit note to the buyer for the amount paid for the returned merchandise. For the same purpose, the buyer creates a Debit note.

In this blog I will explain the configuration and use of credit and debit notes.

Credit Note : It is effortless to use and manage credit notes with the Odoo 15 Accounting module in any of these cases. To use Credit Note, go to the Accounting module dashboard and click on the customer tab and select the Credit note from the drop down menu.

Accounting Module > Dashboard > Customer > Credit Note.

When you click on the Credit Note, you will see the list of credit notes which have already been created. You can select one among them or you can create a new one with the help of the “Create Button”.

For me, right now there is no Credit note created so I will create a new one. So let’s click on the Create Button and a new form will appear. For reference you can see the screenshot below.

Choose the customer and give them the delivery address. After the configurations on the upper section of the invoice under the invoice tab, you can add the products by clicking on the Add a line button. Choose the product and add it to the invoice as shown in the screenshot below.

Now mention the invoice date, due date, journal. Add the Product, and in the Journal items, you can check the Journal items, and you can have and add more info under the Other info tab.

When you fill in all the information, click on the “Confirm Button.

After this click on the “Register Payment Button”.

When you click on the “Register Payment Button”, a new form will appear. For reference you can see the screenshot above. The Files will be automatically filled in concerning the product you have chosen. After the configuration, click on the “Create Payment” button, and the invoice will display with the tag as “In Payment”, as shown in the screenshot below.

Credit Note from Customer Invoice : You can create Credit Note from customer invoice also. For this go to the customer tab of the Accounting module dashboard and click on the “Create Button” to create a new invoice.

Accounting Module > Dashboard > Customer > Invoice

When you click on the Invoice, you will see the list of invoices which are already created. You can select one from them or you can create a new one with the help of the “Create Button”.

When you click on the “Create button”, a new form will appear. You have to fill in all the fields and click on the “Confirm Button”.

When you click on “Confirm Button” you will come to the new page. Here you can see the button for “Add a Credit Note”. For reference you can see the screenshot below.

When you click on the “Add Credit Note Button” a new window will appear.  For reference you can see the screenshot below.

There are three Credit Methods: Partial Refund, Full Refund, Full Refund, and New Draft Invoice.

You can choose between three options:

  • Partial Refund : Selecting the Partial refund creates the Draft credit note prefilled with the original invoice information. 
  • Full Refund : If you choose Full Refund, the credit note will be automatically validated and will be reconciled with the invoice. 
  • Full refund and new draft invoice : If you select Full Refund and New Draft Invoice, then the credit note will be auto validated and will also be reconciled with the invoice. The original or the real invoice will be saved and duplicated as a new Draft.

Now click on the Reverse Button and you will come to the new page. On the new page click on the Confirm button. For reference you can see the screenshot below.

When you click on the “Confirm Button”, a new page will appear. For reference you can see the screenshot below.

Now click on the “Register Payment” and a new window will appear for configuration of the register payment.

All of the details will be auto-filled, and if you want to change the configuration, you can do it from here. After the setup, click on the CREATE PAYMENT, and the formats will be saved.

Now if you want to see the Credit Note which you have created right now, go to the Accounting tab of the Accounting Module dashboard and then select the Sales Journal from the drop down menu.

Accounting Module > Dashboard > Accounting Tab > Sales Journal.

From here you will come to the Sales section and here you can see the newly created “Credit Note”.

From the above highlighted screenshot you can see the newly created Credit Note.

Debit Note : Debit notes are essential documents issued when the goods are returned due to many factors, including Damage to the goods or issues in services and many more. Managing debit notes is essential to keep an excellent customer-to-business relationship.

If you want to see how Debit Note works then go to the Accounting Module dashboard and then go to the Vendor tab and select bill from the drop down menu of vendor.

Accounting Module > Dashboard > Vendor > Bills.

The page of the Bill list is open as you can see in the screenshot below.

Here you can see the bill number, vendor, bill date, reference, next activity, tax excluded, total and status of the bill. You can see all the details of the bill here. To use the Debit note feature, select from the Bills or create a new bill and a configuration page will show. Let me select one of them from the list and the configuration page will open as shown in the screenshot below.

When you click on the “Add Debit Note Button” a new popup window will appear. For reference you can see the screenshot below.

In the Reason column, you can type in the reason for the debit notice. The Utilize Specific Journal option allows you to use a specific Journal for the Debit Note. To see and choose from the Journals defined, click on the fields next to it. Simply type in the name of the new journal, and a Create and Edit button will appear, as shown in the screenshot below. 

If you want to create a new journal just type in the name of the new Journal, and a Create and Edit button will appear as highlighted in the screenshot below.

From here, you can start a new specific journal. Save the configuration and, if necessary, add it to the Debit note. 

In the Debit Note Configuration section, select the Debit Note Date. After you’ve finished configuring the debit note, click the “Create Debit Note Button” to start creating it. Following the Debit Note setup, the Vendor Bill page will appear. Click the Confirm button after adding the product to the Invoice Lines as shown in the screenshot below.

When you click on the “Confirm Button” you will come to the next page as you can see in the screenshot below.

The name of the Debit Note can be found in the Bill reference section. The name appears after the bill number, “New Case”. To register a payment, click the “Register Payment Button”. 

In Odoo, this is the way to generate and customize Discount notes. 

This is how you can configure Credit Note and Debit Note in Odoo V15 Accounting Module. If you like to read more blogs written by us click on the Planet-Odoo

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