- There is an Expense that has been paid by an employee who need to get a reimbursement
- The Expense is beeing invoiced and paid in a non-default currency (CNY)
- default currency is USD
So accounting wise I need 3 documents
- a Purchase Invoice
- a Payment that makes the Purchase Invoice “paid” & creates a liability against the Employee
- a reimbursement that equals the liability against my Employee created in Step 2
I am aware that #2 & #3 have to be done with a Journal Entry. A payment Entry (the obvious choice for paying Invoices) can not be used because it is not able to create the liability against the Employee and neither can make use of any other then an asset account of the company as a source for the payment.
The Payable Account I am using to create and balance liabilities against employees is in the default currency USD, so the Journal Entries are multi-currency.
now I am getting an error on the payment JV mentioning a difference between Credit and Debit amount which in fact does not exists (
Total Debit &
Total Credit matching each other as marked).
- line 2 in this JV has a reference to the open Purchase Invoice.
- When I cut off this connection between the JV and the PINV, the error about a Difference entry disappears. But that is not a solution as the Invoice remains in the status of unpaid/overdue if you do not reference to it in the JV line (even if the supplier is referenced)
If I create a 3rd line to
Exchange Gain/Loss with the amount of the error message an actual Difference appears and likewise makes me go in circles when making another difference entry to even that.
We use multicurrency payment entries frequently and the difference for us usually arises from the exchange rate. Since the default company currency is USD - make sure all the lines value in USD is the same. You have to adjust the exchange rate manually as the difference seems small.
If you want to write off the difference - change the sign of the write-off amount from negative to positive - this will not lead to doubling of difference. Also ensure that the total amount withdrawn from USD account is exact - otherwise your bank balance will not tally.
Remove line 3. The difference with Purchase invoice is arising as it is booked at a different exchange conversion.
Thanks, the exact right pointer.
manually adjusting the exchange rate of the foreign currency in the Purchase Invoice to match the rate in the journal Entry made the problem with the Payment Journal Voucher away.
However I believe the correct way would be that ERPNext shows the difference as Difference Amount in my figure 1 giving the opportunity to make a Difference Entry and likewise being able write that off to Exchange Gain/Loss correctly.
Welcome - glad it resolved your issue…
The journal entry is posting a payment for the invoice. Use same exchange rate in Journal Entry as invoice - and payment will match invoice amount. If you use different exchange rate for journal entry and invoice - they are independent of each other in ERPNext - the payment will post - but the outstanding balance on the account (in this case employee or supplier) will show a pending - either overpaid or underpaid. So we always lookup the purchase invoice exchange rate and then use in Journal Entry - as payment date generally lags invoice date.