Down payment clearing account (SAP Business One)

The down payment clearing account is a special account that is used when posting down payments. By default, the system accesses the account displayed in the "Account determination for G/L accounts" in the field "Down payment clearing account" is stored. Alternatively, in the "Business partner master data" under the tab "Accounting" → "General" a different account can be specified.

Important: This account must not be "Chart of accounts" not be defined as a reconciliation account. When posting a down payment, the down payment clearing account acts as an offsetting account to the customer or vendor account.

Additional information on advance payments:

Companies use advance payments to secure orders and guarantee the customer's commitment.
There are two types of down payment vouchers:
1. Down payment request
  - This receipt only serves as a reminder and payment request to the customer.
  - No journal entry is made at the time of creation. Turnover, value added tax, Change in inventories and expenses are only posted when the down payment request is transferred to an outgoing invoice.
2. Down payment invoice
  - During creation, VAT is posted for the down payment amount, while the net down payment amount is posted to the down payment clearing account.
  - Sales, inventory changes and expenses only arise when the down payment invoice is converted into an outgoing invoice.

Example:

A company receives a down payment of €1,000 from a customer. The booking is made as follows:

The advance payment clearing account is Have booked at € 1,000.
At the same time, the customer's debtor account in the Target charged with € 1,000.

The down payment clearing account is therefore a central instrument in SAP Business One for correctly posting down payments. It ensures that the current status of down payments is displayed transparently and precisely in financial accounting at all times.

FAQ-FINANCE-SAP BUSINESS ONE