Add a Customer as a Supplier and Link Accounts to Reconcile Balances

If the customer asks whether they can add a customer as a vendor, yes you can link the customer and vendor to the same account and treat them as a single entity with a dual role (customer + vendor), and you can then easily settle their balances.

Steps

1. Add or Edit Vendor

   • Go to Purchases > Vendors

   • Click Edit next to the vendor

   • Enable the Link to Customer option

2. Select the Customer

   • Search for the customer by name or reference number

   • Or add a new customer by clicking the ( + ) icon next to the field

3. Save

   • Click Save

   • The page will update and the entity will appear as Customer + Vendor

4. Navigate Between Files

   • From the vendor page click View

   • You’ll see the linked customer option

   • You can click their name and navigate directly to their file

Settle Balances Between Customer and Vendor

After linking, you can settle their accounts directly through applying a prior voucher.

1. From sales invoices, find the sales invoice you want to settle.

2. Click the Payment button > Apply Prior Voucher

3. A list of open invoices will appear

4. Select the invoices and specify the allocation amount

5. Click Save, and the balance will update automatically for both parties

Important Note

• Currently, when you perform this action “settle and close sales and purchase invoices,” they will not appear directly in:

  • Customer or vendor statement

  • Trial Balance

  • Balance Sheet

  The system does not automatically create a journal entry, so you must manually create a settlement entry to clear the accounts between the customer and vendor.

  We are working on automating this process in the future, so the entry will be created automatically and financial reports will reflect the settlement immediately.

Benefits

• Fast settlement between linked customer and vendor accounts

• Reduced errors and data duplication

• Automatic balance updates for both parties

• All operations recorded in the Activity Report (amount, date, user)

Important Notes

• Linking and settlement are only available to users authorized to add or edit vendors

• The operation is automatically recorded in the Activity Report

• The allocation appears in the invoice details for both parties

Reports Affected by Settling Sales and Purchase Invoices for the Same Customer/Vendor

• Customer Page (Customer view page)

  When accessing the customer list and clicking View next to the customer:

  • Total outstanding: The total outstanding balance decreases.

  • Overdue: The overdue amount decreases if the settled invoices were overdue.

  • Bills status / Simple Bill status: Invoice status changes (Approved → Partially/Fully Paid).

• Vendor Page (Vendor view page)

  When accessing the vendor list and clicking View next to the vendor:

  • Total outstanding: The vendor’s total outstanding balance decreases.

  • Overdue: The overdue amount decreases.

  • Invoices status / Notes and Returns status: Invoice status updates from Approved to Paid or Partially Paid.

• Operation Reports (Operation reports)

  • Aged open invoices (Customer Aged Debt Report): Decrease in open invoice amounts and aging updates.

  • Aged open bills (Vendor Aged Debt Report): Decrease in open invoice amounts and aging updates.

  • A/R by customer (Customer Receivables Report): Decrease in customer balance (Invoices Remaining amounts).

  • A/P by vendor (Vendor Payables Report): Decrease in vendor balance (Bills Remaining amounts).

• Unallocate (Return Invoice to Previous State)

• You can unallocate to remove any allocation performed on the invoice (for entities with dual role customer+vendor), whether:

  • Customer invoice allocation against purchase invoice or simple invoice.

  • Purchase invoice or simple invoice allocation against customer invoice.

• Balances and statuses are updated immediately, with full recording in the Activity Report.

How to Use

1. Open the Purchases/Sales page where you want to unallocate.

2. Next to each invoice you’ll find an Unallocate button.

3. Select the invoice you want to unallocate.

4. Click Confirm.

   • The allocation will be removed and the outstanding balance will be restored on the invoice and the counterparty (purchase invoice / simple invoice) and vice versa

What Happens After Unallocation?

• Balance Updates:

  • The outstanding balance on the invoice increases by the amount of the unallocated value

  • The balance on the counterparty document (purchase invoice/simple invoice/sales invoice) increases by the same amount.

• Status Updates:

  • The status of the invoice or counterparty document may change to Approved or Partially Paid depending on the new balance.

• Complete Audit Log:

  • The unallocation operation is recorded in the Activity Report with: Date/Time, User, Amount, and Affected Documents

Required Permissions

• Create Invoices permission.

• If permissions are not available, the Unallocate button will not appear.

Restrictions and Validations

• The allocation must belong to the same entity.

• Unallocation is not allowed if the period is closed.

• The system prevents entering an unallocation amount greater than the current allocated amount.

Search Keywords:

• Can I add the same person as both customer and vendor?

• Is there a way I can deal with someone who is both customer and vendor?

• How do I handle an entity I buy from and sell to at the same time?

• Does the system allow adding the name twice? Once as customer and once as vendor?

• Can I link sales and purchase invoices for the same entity?

• I have someone I buy from and who buys from me, what is the correct way to enter them?

• How do I settle between customer and vendor accounts if it’s the same person?

• Is there an option to make the customer appear in purchases?

• Why doesn’t the name appear in purchase invoices even though I have them as a customer?

• Can I deal with the same entity in sales and purchase invoices?

• When I close or settle sales and purchase invoices for the customer and vendor they don’t appear in the statement