Managing Credit Memos in Tabs

Once a credit memo is created, you can view, edit, download, or apply it to invoices. This article covers the impact on accounting, notifications, and advanced usage.

Syncing with the General Ledger

• Tabs → GL
  Both the credit memo and invoice adjustment sync immediately.

• GL → Tabs

  • QuickBooks: Credit memos created in QuickBooks sync back as a payment (closing the invoice, but not affecting revenue).

  • NetSuite: Credit memos created in NetSuite do not sync back to Tabs.

Accounting Impact

When a credit memo is created in Tabs:

• Credit: Accounts Receivable

• Debit: Account(s) tied to the integration item(s)

Revenue impact:

• Revenue GL account: Revenue is reduced.

• Expense GL account: No revenue impact.

These effects flow into:

• Revenue Recognition Report

• ARR Waterfall

• Revenue Close Management journal entries

Viewing and Downloading Credit Memos

• From Sidebar: Go to Invoicing > Credit Memos

• From Invoice: Open the invoice → three dots (⋮) → View Details

• Download PDF: Available in credit memo details or via invoice action menu

Customer Notifications

• Customers are notified only when a credit is applied to an invoice.

• They receive an email with a PDF of the updated invoice.

Customization

• Update the credit memo prefix in Billing Settings.

• To adjust revenue impact: Credit Memo Details > View Revenue > Edit Revenue.

API and Advanced Use

• Create via API: Yes.

• Customer-Level Credit Memos: Apply credit at the customer level for future invoices.

• Future Use: Create a credit memo now and apply it later.

• Multiple Invoices: Open credit memos can be applied across multiple invoices.

Key Takeaways

• Credit memos sync to the GL automatically.

• Revenue impact depends on the GL account tied to the product.

• Customers are notified only when credits are applied.

• Advanced API options allow future use and multi-invoice application.