Process Returns for Payments done via ACH/EFT

Per Enhancement 91522: "ACH Payments> extend ACH Vendor Payments to the Customer side for refunds or allow the EFT Customer feature to handle refunds", NetSuite currently does not have the ability to process refunds for EFT customers using ACH Processing.

An alternate solution to handling this process involves creating either a standalone cash refund or credit memo for the full amount, depending on how the customer prefers to be refunded.  A journal entry is also required if the invoice was paid with a discount taken amount.

Here are the steps:

Cash Refund

1. Navigate to Transactions > Customers > Refund Cash Sales.
2. Key in the information such as the Customer and Location fields. 

* The Create Check and Print Check fields should be marked if the checks need to be created and printed within NetSuite.  If not, type in the actual check number that was already made in the Check # field.

3. In the Items tab, add the item that will be returned.
4. In the Payment tab, set the Payment Method to Check. 
5. Make sure that every other setting has been done, and then click on Save.

* The refund will be for the full invoice amount.

Credit Memo

1. Navigate to Transactions > Customers > Issue Credit Memos.
2. Key in the information such as the Customer and Location fields. 
3. In the Items tab, add the item that will be returned.
4. Make sure that every other setting has been done, and then click on Save.

* The credit memo will be for the full invoice amount, which you can apply for future invoices entered for the customer.

A journal entry is also required if the invoice was paid with a discount taken amount.  This is particular for invoices that were paid with terms having a discount date, and those invoices were paid well before the discount date.

Here are the steps:

1. Navigate to Transactions > Financial > Make Journal Entries.
2. Add the discount amount in both the debit and credit side.  Make sure that the entry looks like this:

DR Accounts Receivable
CR Cash

3. On the line where the Receivables account is, add the customer's name in the Name column.  This will make sure the journal entry is included against the customer's account.
4. Click on Save when done.

The journal entry is still the best way to record the discount taken because it will make sure the amounts will go to the correct accounts.  Using the discount on the credit memo will make the discount amount go to the sales discount account, which is not the same as the actual discount taken account.  This may cause issues in the long run when tying up the actual payment with the credit memo.