Ensuring invoices for staged payments are handled correctly

I issue 3 invoices for a single order, one is for an advance payment, one is issued on delivery and the third one month after delivery. I don’t know how to best account for these to ensure they appear in the correct accounting year. The total value of the sale should be accounted for in a single accounting period as determined by the delivery date.

I’m thinking that the 1st stage invoice should be tagged to something like Advance Payments and Accruals, but can’t see how to do this. Maybe I need to create a journal to move it from General Sales to Accruals? When delivery is made a reverse journal can move it back to General Sales. Could this work?

And how can I account for the 3rd stage invoice if the invoice date is after the year end?

When you create an invoice you can click the little cog wheel icon in the item description box to get a drop-down selector that lets you assign the invoice line to a different nominal. You may have to configure the nominal in question via the chart of accounts to allow it to be used on sales invoices.

This would be part of your year-end adjustment process. Assuming the third-stage invoices post to general sales, you’d need a journal on the last day of the relevant (i.e. previous) year to credit general sales and debit a balance sheet code like accruals, and set it to auto-reverse the following day in the new accounting year.

Thanks Ian for confirming that I was on the right track. I will do as you suggest.

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