Down Payment Interim Account, Down Payment Clearing Account 
Note
The automatic reconciliation functionality of these two accounts is not available in the following localizations, which have their own down payment handling process: Czech Republic, Slovakia, Hungary and Russia.
When a company receives or makes a down payment, the payment amount is recorded in an interim account before it’s deducted from the final transaction. For period end auditing purposes, the transactions that make up the value of the interim accounts must be easily auditable.
In SAP Business One, postings are made to the following two interim accounts in the down payment process:
Down payment clearing account
Down payment interim account
The postings to these two accounts are automatically reconciled as follows:
Down Payment Request Process
When you create a payment for an A/R or A/P down payment request, the down payment interim account is debited or credited with the payment amount, and the down payment clearing account is credited or debited with the payment amount excluding tax.
When you fully or partially draw the down payment to the final A/R or A/P invoice, the down payment interim account is credited or debited with the drawn amount, and the down payment clearing account is debited or credited with the drawn amount excluding tax.
As a result, the postings to the down payment interim account and the down payment clearing account are fully or partially reconciled accordingly.
Down Payment Invoice Process
When you create a full or partial payment for an A/R or A/P down payment invoice, the down payment clearing account is credited or debited with the invoice amount excluding tax.
When you fully or partially draw the down payment to the final A/R or A/P invoice, the down payment clearing account is debited or credited with the drawn amount excluding tax.
As a result, the postings to the down payment clearing account are fully or partially reconciled accordingly.
In the above two processes, if the final A/R or A/P invoice is then fully or partially drawn to a credit memo, the postings to the two accounts generated by the A/R or A/P invoice are proportionately reversed and reconciled.
However, if either of the two accounts has been fully, manually reconciled before the automatic system reconciliation takes place, SAP Business One does not perform the system reconciliation.
Note
You can cancel the automatic system reconciliation only if the document that triggers the reconciliation is cancelled.
Example
You create a sales order as follows:
Item No.
Quantity
Unit Price
Total
Tax
A01
50
1
50
8.75
You create an A/R down payment request based on the sales order and create an incoming payment for it as follows:
Item No.
Quantity
Unit Price
Total
Tax
Down Payment Made
Total Payment
Payment Means
A01
10
1
10
1.75
10
11.75
Cash
The corresponding journal entry posting is as follows:
Account
Debit
Credit
Cash on Hand
11.75
BP Account
11.75
Down Payment Interim Account
11.75
VAT Payable (Output Tax)
1.75
Down Payment Clearing Account
10
You create a final A/R invoice based on the sales order and partially draw the down payment to it as follows:
Item No.
Quantity
Unit Price
Total
Tax
Net Amount to Draw
Tax Amount to Draw
Gross Amount to Draw
A01
50
1
50
8.75
4
0.7
4.7
The corresponding journal entry posting is as below:
Account
Debit
Credit
BP Account
58.75
Down Payment Interim Account
4.7
Down Payment Clearing Account
4
VAT Payable (Output Tax)
8.75
VAT Payable (Output Tax)
0.7
Revenue Account
50
Inventory Account
50
Cost of Goods Sold Account
50
SAP Business One automatically reconciles the postings to the down payment interim account and down payment clearing account as follows:
Account |
Debit |
Credit |
Reconciliation Amount |
Balance Due |
|---|---|---|---|---|
Down Payment Interim Account |
11.75 |
4.7 |
4.7 |
7.05 |
Down Payment Clearing Account |
4 |
10 |
4 |
6 |