The Accounts Payable from Accounts Receivable options on the Period End menu, along with the Vendor/Customer Link Maintenance option on the Setup menu, make up the A/P from A/R Clearing process.

To Setup the Vendor/Customer Link:

1. Open Accounts Payable / Setup / Vendor/Customer Link Maintenance
2. Select the Customer whose balance is to be reduced
3. Select the Vendor whose balance is to be applied
4. Click Accept.

To Process A/P from A/R Clearing:

 
NOTE: Back up all data in Accounts Payable and Accounts Receivable before using A/P from A/R Clearing Register.

1. Go to Accounts Payable, Period End, AP from AR Clearing Selection or AP from AR Clearing Entry and use A/P from A/R Clearing Selection to choose the vendors/customers to be included in the clearing process. The vendor/customer links must have been established in Vendor/Customer Link Maintenance.
   
   NOTE: This option can only be used if customers are set up in the Accounts Receivable module. If multiple customers are linked to a single vendor, verify that the amount being cleared from the customer to Accounts Payable does not exceed the vendor's balance, or the vendor's account may have a negative balance.
   
2. The A/P from A/R Clearing Register is an audit report used to check the accuracy of selected Accounts Receivable invoices before their clearing to Accounts Payable.
   • Information on the A/P from A/R Clearing Register includes the register number, customer/vendor name and number, invoice number, amount to apply, discount date, discount amount, invoice balance, amount credited to Accounts Receivable, and amount debited to Accounts Payable.
   • The amount to apply, the discount amount, the credit to Accounts Receivable, and the debit to Accounts Payable amounts are totaled for each clearing entry.
3. When the selection is correct, update the register.

After the A/P from A/R Clearing process has been completed for a vendor/customer, transactions are recorded in both Accounts Payable and Accounts Receivable.

• The A/P from A/R Clearing process takes the Accounts Payable balance and applies it to the Accounts Receivable open invoice balance.
• It clears the oldest invoices in the account first, and continues to apply the Accounts Payable balance until it is zero.
• This process creates payments in Accounts Receivable with a check number of "CLEARING."
• Bank Code "Z" is used during the clearing process. Do not use Bank Code "Z" if you plan on using the A/P from A/R Clearing feature.
  NOTE: If you do not plan on using the A/P from A/R Clearing feature, you can use Bank Code "Z" for day-to-day entries.
• Accounts Payable / Main / Vendor Maintenance lists the invoice number of the clearing transaction as "ARM-MMDD-x," representing an Accounts Receivable merge, the month and date of the clearing transaction, and the sequence number for the transaction cleared on that day and for that vendor.
• A debit amount appears in the Transaction Amount column, representing the total dollar amount cleared to Accounts Receivable.