Customer/vendor matching (on account)
If no entry fits but the payer is unique, 365 business Banking posts the payment on account to the corresponding customer or vendor.
A payment that does not match any open invoice, such as a double payment, a round installment, or a prepayment without a document, otherwise remains open in the payment reconciliation journal. If the payer is known beyond doubt, the amount is at least posted to the account of the payer. It then appears in the balance and can be applied later.
Standard functionality in Business Central
In the standard, you manually assign such a line to a customer or vendor without selecting an entry. Posting creates an on-account payment. With Apply Entries, you later apply it to the invoice.
For more information from Microsoft, see Reconcile payments that can't be applied automatically and Reconcile customer payments.
What 365 business Banking adds
With Enable On-Account Matching on the Payment Application Settings page, automatic application performs this step. The line receives the customer or vendor and is posted as an on-account payment without an application. The match confidence is High - On-Account Matching if the IBAN identifies the payer unambiguously. If the payer was only found by name or by the payment application fields, it is Medium.
When the matching applies
Only as a last option. On-account matching only offers a candidate when application found no other candidate for the line: no open entry, no reconciliation rule, no payment code or text-to-account mapping, regardless of the rating of that other candidate. Otherwise, a payment for which an open invoice exists would be posted to the account instead of to the invoice.
To ensure this, 365 business Banking calls its matching methods for every line in a fixed order: reconciliation rules, payment code mapping, G/L entry matching, sales documents (only in Apply Manually), and on-account matching last. When on-account matching runs, it is therefore already determined whether any of the other methods found a candidate.
Quick Apply also uses on-account matching, there as the last stage.
How the payer is recognized
365 business Banking searches for a customer and a vendor separately, each in this order:
- Counterparty IBAN: It must be stored on the bank accounts of exactly one customer or vendor.
- Full name: The name on the statement must fully match exactly one customer or vendor (by the same rules as in related party matching: all words in both directions). A name that only partially matches is not sufficient.
- Payment application fields with the source table Customer or Vendor: The value of exactly one customer or vendor must appear in the payment reference or in the counterparty name: Payment application fields.
If both a customer and a vendor are found, for example for a business partner who is both, 365 business Banking assigns nothing. In this case, a user must decide which account is correct.
These strict rules apply because an on-account payment changes the balance of the account without settling anything. A name that fits two records, or an IBAN stored for two customers, therefore does not lead to any assignment.
Turn it on
- Choose the Search icon, enter Payment Application Settings and open the page.
- In the Ledger Entries Matching Settings group, turn on Enable On-Account Matching.
The switch is off after installation.
Apply the on-account payment later
The on-account payment is an open payment entry of the customer or vendor. As soon as the corresponding invoice is posted, apply both with the standard Apply Entries function, either in the customer or vendor ledger entries or in a journal.
Review lines with High - On-Account Matching before posting. If the payment does relate to an invoice, apply the line directly to this invoice with Apply Manually. Check application shows why a line was assigned on account.
See also
- How automatic application works
- Related party matching
- Payment application settings
- Apply bank transactions