FAQ: Vendor Payments

Can I record a payment without assigning it to specific bills?

Yes, you can record a payment to a vendor without immediately assigning it to bills. The payment will be held as a credit (advance balance) on the vendor's account. Later, you can use this credit to offset bills when you are ready, or you can allocate it retroactively when the bills arrive. However, it is best practice to allocate payments to bills at the time of payment for clearer accounting records.

What happens if I pay less than the bill amount?

The paid portion is deducted from the bill, and the unpaid remainder stays outstanding. For example, if a bill is 1,000 and you pay 600, the bill now shows 400 as unpaid. You can pay the remaining 400 later with a second payment.

Can I split a single payment across bills from the same vendor?

Yes. When recording a payment, you can choose to allocate it across multiple bills. For example, if you are paying a vendor 5,000 and they have three outstanding bills (1,500, 2,000, and 2,500), you can allocate 1,500 to the first, 2,000 to the second, and 1,500 to the third (leaving 1,000 unpaid on the last bill).

What is the difference between a payment and a vendor advance?

A payment is recorded against specific bills and reduces those bills' balances. An advance is money paid to a vendor in advance of receiving goods or services. In Usystems, if you pay more than the vendor owes, the excess becomes an advance (credit balance) on the vendor's account and can be used toward future purchases. If you intentionally pay an advance without specifying bills, it is treated as a credit from the start.

Can I undo a vendor payment?

Payments, once recorded, are permanent transactions in your accounting system. They cannot be deleted, but they can be reversed by recording an equal reverse payment (a refund or credit memo). Contact your system administrator if you need to reverse a payment. Do not delete or edit recorded payments in the database.

What if the vendor owes money in multiple currencies?

If the vendor has bills in different currencies (e.g., some in USD and some in EUR), you can pay in either currency. Usystems will use the current exchange rate to convert the payment to match each bill's currency. Make sure to verify the exchange rate applied is correct.

How do I pay a vendor by check?

When recording the payment in Usystems:

1. Select the vendor.
2. Choose Check as the payment method.
3. Enter the check number in the reference field so you can match it to the check register later.
4. Enter the amount and allocate it to bills as usual.
5. Physically write and mail the check using the same amount and reference number.

Usystems records the payment in your system, and you can mark the check as cleared once it is recorded in your bank statement.

What is FIFO in vendor payments?

FIFO stands for First In, First Out. It is a common accounting method where the oldest bills are paid first. When you allocate a payment to multiple bills, Usystems may suggest FIFO allocation (oldest bills first), but you can override this and pay bills in any order you choose.

If I pay a vendor early, do I get a discount?

Discounts are typically negotiated with vendors and are based on the bill terms (e.g., "2% discount if paid within 10 days"). Usystems does not automatically apply early-payment discounts. If you have negotiated a discount with the vendor, record the discount in the bill itself (when the bill was created) or contact your accounting team to apply it when you pay.

Can I see the payment history for a vendor?

Yes. Open the vendor's contact card. You will see a transaction history or ledger showing all bills, payments, and running balance. This helps you verify the vendor's current balance before making a payment.

What accounts are affected when I record a vendor payment?

When you record a payment:

• Accounts Payable (or the specific payable account for that vendor) decreases.
• The bank or cash account you paid from (e.g., bank account, petty cash) decreases.
• The vendor's account balance is updated to reflect the payment.

These accounts are automatically updated when you record the payment in Usystems.