Reducing Invoices

If an invoice item shows a variance from the expected quantity or the expected amount and you do not want to accept this difference, you can reduce the invoice.

To reduce an invoice item, proceed as follows:

1. In the item, choose Supplier error: reduce invoice as Correction ID. This makes the fields Invoice Quantity According to Supplier and Invoice Amount According to Supplier ready for input in addition to the fields Quantity and Amount.

2. Enter the quantity and amount as specified in the supplier invoice in the additional fields Invoice Quantity According to Supplier and Invoice Amount According to Supplier.

3. If you want to accept values for amount and quantity that differ from the default values, change the default values. The system determines the difference amount by which the invoice is reduced.

4. Post the invoice.

When you post an invoice with invoice reduction, two accounting documents are created. The first document contains the vendor and tax postings according to the values from the supplier invoice. The second document contains a credit memo for the difference between the actual values and the default (or accepted) values.

This means that an invoice is not really reduced during invoice reduction. Instead, an additional credit memo is posted using the reduction amount. As a result, only the amount reduced by the invoice reduction is kept as a payable to the supplier.

The purchase order history is updated with the default (or accepted) values.

When you post an invoice reduction, the system generates a message. This means that a letter of complaint (notification of credit memo posting) can be issued to the supplier.

For invoice reduction, depending on the company code you can define in Customizing whether the original document needs to be posted with a reduced tax or if the tax needs to be corrected in the reduction document.

You can define the tax treatment in Customizing for Materials Management under Logistics Invoice Verification → Incoming Invoice → Tax Treatment in Invoice Reduction.

If you want to specify why you made the manual reduction, you can define complaints reasons for this. To do so, go to Customizing for Materials Management and choose Logistics Invoice Verification → Incoming Invoice → Maintain Reasons for Invoice Reduction.

You also have to ensure that a document type can be determined for the credit memo document that is generated automatically. For this, maintain the Customizing settings relating to the number assignment for the accounting document. The document types are assigned depending on the transaction. In Customizing choose Materials Management → Logistics Invoice Verification → Incoming Invoice → Number Assignment → Maintain Number Assignments for Accounting Documents (OMR4) and then choose Document Types in Invoice Verification.