Reverse credit memos (2024)

The Invoice Settlement feature is generally available as of Zuora Billing Release 296(March 2021).This feature includes Unapplied Payments, Credit and Debit Memos, and Invoice Item Settlement. If you wantto have access to the feature, see Invoice Settlement Enablement and Checklist Guidefor more information.After Invoice Settlement is enabled, the Invoice Item Adjustment feature will be deprecated for your tenant.

Overview

Reversing a credit memois a single atomic operation that completes the following actions:

• A debit memo isgenerated by mirroring the credit memo, including thecredit memo items, discount items, and taxation items.
• The credit memo is applied to the debit memo to change the credit memo balance to zero.
  The credit memo items and their taxation items are applied to the correspondingly generated debit memo items and their taxation items respectively.The unapplied amount of all credit memo items gets to zero. The balance of all debit memo items gets to zero.
• The charge through date in the Zuora rating engine is reset back to the start of the billing period.
• If an invoice related to the credit memo exists, the invoice is also reversed during the credit memo reversal.
  An invoice and a credit memo are related to each other if they have the same originalproduct rate plan charge and are generated from the same billing operation, for example, from the same bill run, Generate billing documents by account ID operation, orSubscribe call (not recommended).

After a credit memo is reversed, itis flagged as Reversed. In the Zuora UI, the Reversed field in the Basic Information area of a credit memodetail page shows whether this credit memo is reversed.

If a bill run is executed right after the credit memo reversal, a credit memo exactly the same as the reversed one is generated.

Ifyou reversea credit memo, you are no longerable to cancel or change the reversed credit memo and the generated credit memo.

As a tenant administrator, you can configure the Billing user permissions to restrict users from reversing credit memos. See Billing Roles for more information.

You can only reverse the most recently generated credit memo for each subscription. If a new credit memo is generated for asubscription, you cannot reverse the previously generated credit memos for this account.

If you have enabled the invoice settlement earlier than the credit memo reversal rollout period, and when reversing the credit memo, you may get an error "Unable to get the reason code by name: Credit memo reversal." You must fix this error by manually creating an exact reason code, "Credit memo reversal," in the debit memo reason code list. To add a new reason code, seeCreating and Editing Reason Codes.

You can reverse credit memos either throughthe Zuora UI or REST API.To reversea credit memo through the Zuora REST API, see PUT Reverse acredit memo.

Procedure

To reverse a credit memo through the Zuora UI, perform the following steps:

1. Navigate to Billing > Credit and Debit Memos in the left-hand navigation section.
2. On the Credit and Debit Memos page, click the credit memo that you want to reverse.
3. On the credit memo details page, clickmore > Reverse Credit Memo.
4. In the Reverse Credit Memo dialog that is displayed, specify the following basic information:
   • In the MemoDate field, specify the date whenthe debit memo is created.
   • In the Apply Effective Date field, specify the date when the credit memo is applied to the debit memo.
5. Click save to save the configurations.

Restrictions and limitations

Reversing credit memos has the following restrictions and limitations:

• You cannot reverse thecredit memothat iscreated from an invoiceor a product rate plan charge.
• If multiple credit memos are generated for one subscription, you can only reverse the latest one.
• You cannot reversethecredit memo that has been partially applied or refunded. The reversal is allowed after the refund on the credit memo is cancelled or the credit memo is fully unapplied.
• You cannot reversea credit memo if the corresponding accounting period has been closed or the credit memo has been transferred to accounting.
• You cannotunapply a reversed credit memo.