Customer Prepayments

The Customer Prepayment feature in GoldFinch helps manage customer deposits before delivering goods and services. Prepayments are calculated as a percentage of the Sales Order total and are set up using a GoldFinch Payment Term record, which is assigned to a Customer Account.

Setting Up the Customer Prepayment Feature

• Create a Customer Prepayment GL Account

  • Open the App Launcher and search for GL Accounts.

  • Click New and fill in the form with the following values:

    • Account No.: 2200-Customer Prepayment

    • Type: Balance Sheet

    • Sub Type 1: Liabilities

  • Click Save.

• Create a Payment Term with a Default Prepayment Percentage

  • Open the App Launcher and search for Payment Terms.

  • Click New and populate the form:

    • Payment Term Name: Prepayment n% (where n is the prepayment percentage)

    • Prepayment %: n (prepayment percentage)

    • Due Date Calculation: 0

    • Discount Date Calculation: 0

    • Discount %: 0

    • Description: Prepayment

    • Bypass AR: Unchecked

  • Click Save.

• Assign the Payment Term to the Customer Account

  • Open the App Launcher and search for Accounts.

  • Select the Customer Account and edit the Payment Term field to assign the newly created Prepayment Payment Term.

  • Click Save.

• Create a Customer Prepayment Service Item

  • Open the App Launcher and search for Items.

  • Click New and enter the following details:

    • Item No.: Z-Customer Prepayment Item

    • Base Unit of Measure: EA

    • Item Type: Service

    • Description: Customer Prepayment Item

  • Click Save.

• Set Up the Account Posting Setup Record

  • Go to the new Z-Customer Prepayment Item and find the Account Posting Setups related list.

  • Click New and populate the form:

    • Account Sales: 2200-Customer Prepayment (GL Account)

    • Account Sales Return: 2200-Customer Prepayment (GL Account)

    • Company Setup: Select your company’s setup record

    • Item: Z-Customer Prepayment Item

  • Click Save.

• Assign the Prepayment Item to the Company Setup Record

  • Open the App Launcher and search for Company Setup.

  • Click on the Company Setup record and assign the new Z-Customer Prepayment Item to the Customer Prepayment Item field.

  • Click Save.

How to Use the Customer Prepayment Feature

• Create a New Sales Order with Prepayment Payment Terms

  • The Prepayment Payment Term and Prepayment % will automatically populate from the Customer Account.

  • You can modify the Prepayment % directly on the Sales Order if needed.

Generate a Prepayment Sales Invoice

• After entering all Sales Lines, click the Create Prepayment Invoice button.

  • The Prepayment Invoice field will be checked on the Sales Invoice.

• The Prepayment Sales Invoice will include a line item for the Customer Prepayment Service Item.

• Prepayment amount is calculated as:
  Sales Order Amount × Prepayment %

• Prepayment tax amount is:
  Sales Order Tax Amount × Prepayment %

• The Prepayment Tax Amount is posted to the Account Sales Tax Payable specified in the Company Setup.

• You can create multiple Prepayment Sales Invoices for a single Sales Order. However, the total prepayment amount from all these invoices must not exceed the Sales Order’s Amount (Including Tax).

• By default, GoldFinch calculates prepayment amounts based on Order Amount and Tax Amount separately. If you prefer to calculate prepayments based on the Order Amount Including Tax while setting the Tax Amount to zero on the prepayment invoice, you can enable a custom setting as follows:

  • Refer to Managing GoldFinch Custom Settings to configure a new custom setting:

    • Name: PrepaymentIncludeTax

    • Value: True

Posting the Prepayment Sales Invoice

• Click Post to finalize the Prepayment Sales Invoice. This credits the Customer Prepayment GL Account.

• The Prepayment Sales Invoice can now be sent to the customer, and customer payments can be applied against the invoice.

Handling Payments to a Different GL Account

• To debit an Undeposited Cash Account instead of the standard AR Account, update the Payment Term on the Sales Invoice as follows:

  • Check the Bypass AR field on the Sales Invoice.

  • Populate Account Undeposited Cash with the appropriate GL Account.

• After delivering goods and services, ensure the Warehouse Receipt is created and posted.

• Create the final Sales Invoice using the standard process.

• GoldFinch will add a line to the final invoice to reverse the total prepayment amount and tax amount. When posted, the Customer Prepayment GL Account is debited.

• GoldFinch will add a line to the final invoice to reverse the total prepayment amount. When posted, the Customer Prepayment GL Account is debited.

Correcting Mistakes

• If a mistake is found, unpost the invoice, make corrections, and repost.

• If the prepayment invoice is no longer needed, unpost it and delete the invoice.

Sales Reporting Issue

Prepayment invoices will be included in the Sales Invoice table. If you do sales reporting and are concerned that prepayment invoices could distort your sales amount, you can run reports based on the Sales Invoice Lines, excluding the Prepayment Item. Alternatively, you can choose to use Customer Receipt to record prepayments, thereby bypassing the entire customer prepayment function.

Sales Reporting Considerations

Prepayment invoices are included in the Sales Invoice table. If you are running sales reporting and are concerned that prepayment invoices might distort your monthly sales figures, consider the following options:

• Run Sales Reports by Sales Invoice Lines – Exclude the Prepayment Item when running reports to ensure accurate sales amounts.

• Use Customer Receipt Instead – If prepayments are a concern, you can record them using Customer Receipt, bypassing the customer prepayment function entirely.

Article Customer-Prepayments  ·  Last updated January 27, 2026 · GoldFinch ERP Help Center