SuiteSolution- Vendor Prepayment

By - July 22, 2019


Have you ever run into a situation where you have to pay a vendor prior to receiving the goods and services? NetSuite out of the box allows you to create three types of transactions to handle this requirement.

  1. Create a holding account: The holding account tracks the funds until they are applied to a vendor bill.
  2. Write a check: The check moves funds into the holding account and out of the checking account. Then, the funds are not available in the checking account for other payments.
  3. Enter a vendor credit: The vendor credit is used to apply the funds to the vendor bill when the bill is entered.

The difficulty with the out of the box functionality is that NetSuite does not track the Vendor Prepayment against the Purchase Order / Vendor Bill correctly and is unable to report on it.

NetSuite has created a SuiteSolution to be able to resolve the issue. The Vendor Prepayments SuiteSolution allows advance payments to vendors to be created, tracked and applied to vendor bills automatically.

Once the SuiteBundle, SuiteSolutions – Vendor Prepayments (ID- 132058), is installed and configured, here are the high level steps you could follow:

  1. Create a Purchase Order and send it through the approval workflow
  2. Create a Vendor Prepayment Bills
  3. Auto- Create on offsetting credit
  4. Pay the Bill

Below is an example of the Vendor Prepayment Transaction created via the SuiteSolution.

Creating Vendor Prepayment Transaction via the SuiteSolution:

  1. Create and save a PO that has been approved. In the View screen, click on New Vendor Prepayment.

2. NetSuite will open the Vendor Prepayment window, and it will be prepopulated data from the PO and the Vendor. Enter data in the Prepayment Details and Prepayment Amount The Prepayment Bill Due Date will be prepopulated with Today’s date, which can be overridden.

3. Click back on the Prepaid Purchase Order and go to the Vendor Prepayments This will show the Bill that was created from the Prepayment transaction. Click on the Bill to view the details. Note that the amount has not been applied yet because the bill has not been paid yet.

4. Click on Make a Payment to generate a payment. If you notice a discount, this is being pulled from the Terms on the vendor form.

5. If you go back to the PO, you will notice that the amount is tagged to the Unapplied Amount.

a. Note that the SuiteBundle has automatically created a Prepayment Credit. Click on the Bill Credit to see the credit that was created

6. Receive the PO and Generate a Bill. If you go to the Vendor Prepayment tab, you will notice that the Credit is still tagged to this Bill.

7. Generate a payment and you will notice that NetSuite automatically select the Bill and the Credit.

Additional Information:

SuiteSolutions are industry-leading, solution accelerators that are designed and developed by NetSuite Professional Services. For more detailed information on pricing and installation, please contact NetSuite or RSM support for more information.

For more information on this topic or others related to NetSuite, contact RSM at or by phone at 855.437.7202.

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