Before You Begin:
- You collected a sponsorship payment on an invoice before the event was set up in GrowthZone, and those funds have most likely already been deposited.
- Note the original invoice number, the original fee item used, and the amount paid — you’ll reuse the original fee item on the credit memo.
- Permissions to create credit memos and to register a sponsor for an event.
- Be aware that unapplying the payment is likely not an option once funds are deposited, and Unapply is not available at all if the payment was made through a NAR Ecommerce payment gateway.
Why the “easy” options fall short
You hold a community celebration every year, and it’s common for event sponsors to pay for their sponsorships early, before you even get the event set up in GrowthZone. So you set up an invoice and apply the payment (or take a payment online) and go on with business as usual until you finally get the event built. But then: how do you get that pre-sold sponsorship to show that payment as revenue on the event?
Depending on how long ago the payment was, or even the type of payment, it’s likely those funds have already been deposited — so unapplying the payment in an effort to apply it to a new invoice for the actual event sponsorship is likely not an option.
| IMPORTANT! Unapply is not an available option if the payment was made through a NAR Ecommerce payment gateway. |
You would also need the ability to void the original invoice, register the sponsor in the event, and apply the overpayment to the newly created invoice — but depending on your accounting settings or policies, voiding an invoice may not be an option either. If unapplying the payment and voiding the original invoice aren’t available to you, here are a couple of “easy” options (each with drawbacks):
- Create a staff-only registration type for $0 and register that sponsor for the event. The sponsor then receives their sponsor display benefits. The caveat: the already-invoiced payment will not count as revenue for the event.
- Register your sponsor as you normally would and allow the event invoice to be created; then apply a “payment” to that invoice (probably a check, or a trade/external payment type) that indicates the previous invoice number and payment. While your event revenue totals will then be correct, it’s possible you’re doubling up on the actual received revenue, as that single payment will appear in your accounting twice (once for the original invoice, and again on the “actual” event invoice for the sponsorship).
Both options have pros (simple!) and cons (inaccurate revenue recognition). Instead, use the suggested process* below, which makes sure the appropriate accounts are debited and credited and ensures the event itself shows the revenue.
Step-by-Step Instructions
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Create a credit memo for the amount of the previously paid invoice, making sure to use the original fee item that was used to create the original invoice. Best Practice: include the full name of the event in the Notes portion of the credit memo being issued. This lets you use that field as a filter for the Credit Memo Report and will help during the Event Revenue reconciliation process.
TIP! Credits cannot be created or applied within the event. Create or apply credits from the Contact’s record on the Billing tab. See “Add or Apply Credit Memos” for more information. - Register the sponsor for the event and let the system generate the invoice for the sponsorship.
- Apply the credit to the new invoice.
Common Pitfalls
- Double-counting revenue: Applying a second “payment” to the event invoice instead of a credit memo can make the same funds appear twice in your accounting. Use the credit-memo process to keep revenue recognition accurate.
- Wrong fee item on the credit memo: Always use the original fee item from the first invoice; using a different fee item will debit/credit the wrong accounts.
- Trying to credit from inside the event: Credits cannot be created or applied within the event — create or apply them from the Contact’s record on the Billing tab.
All processes and transactions suggested by GrowthZone should be vetted by your accountant.