Credit Memos
A Vendor Credit Memo records a credit you expect — or have already recovered — from a supplier: units that arrived damaged, short, or unsellable, an overcharge on an invoice, a freight rebate, or any other adjustment. Build one from scratch (add products from your catalog or a linked purchase order, plus tax, shipping, and other amount adjustments), turn a receive session's Issues into a draft with one click, or reverse a memo you applied by mistake. Alfred auto-numbers every memo (CM-1000, CM-1001, …), walks it through a clear workflow (draft → sent → approved → applied), and exports a one-page PDF on your own business letterhead to send to the supplier. Credit Memos is its own page in Alfred; a memo can stand alone or link back to a PO and supplier. Two summary cards — Outstanding and Recovered — roll up what suppliers still owe you versus what you've actually clawed back, across the date range you choose.
Status Lifecycle
Draft
Private, fully editable
You're still building the memo. Add products and adjustments, edit quantities, costs, and reasons, change the title or currency — nothing is sent and it counts toward no totals. Delete it outright if it was a mistake.
Sent
Raised with the supplier
You've exported the PDF and sent it, and you're awaiting a reply. Still fully editable, and it counts as Outstanding. Sent is a marker you set yourself — Alfred doesn't email the supplier for you.
Approved
Supplier agreed — still owed
The supplier confirmed they'll issue the credit and you're holding their credit note. Settled but not yet recovered, so it stays Outstanding. Line items lock from here on.
Partially applied
Some recovered, balance remains
You've recovered part of the credit. The applied amount moves to Recovered while the remaining balance stays Outstanding — counted once, in the right bucket.
Applied
Fully recovered — terminal
The whole credit is realized — offset against an invoice or refunded — and the memo is locked. To undo it, issue a Credit Memo Reversal rather than editing or deleting. Counts as Recovered.
Rejected / Void
Declined or cancelled
Rejected means the supplier declined — Alfred resolves the underlying discrepancies so the PO's Credit Memo Due drops to zero. Void means you cancelled the memo. Both drop out of every total; void is terminal.
Key Concepts
Where Credit Memos Come From
Three ways to create one. (1) From scratch — click Create credit memo on the Credit Memos page to open the builder: add products from your catalog or from a linked PO, add 'other adjustments' (shipping, tax, or a billing dispute), attach a supplier, and set a reason on each line. A memo does NOT need a purchase order — attach just a supplier for a freight rebate or invoice dispute. (2) From receive-session Issues — any discrepancy logged with the disposition 'Expecting credit from supplier' shows up on the PO's Credit Memo Due card; one click seeds a draft with a line per credit-eligible issue, using each issue's quantity × the PO line's unit cost. (3) Reversal — from an applied memo, Create Credit Memo Reversal mirrors the original's lines and, once applied, offsets it to zero in your books.
Numbering & Naming
Every memo gets a sequential, per-shop number the moment it's created — CM-1000, CM-1001, and so on (the CM- prefix is configurable in Store Settings). That number is the memo's permanent identifier and is what sorts the list by default. Separately, the optional Memo title is a free-text label — e.g. 'Damaged shipment — March freight' — to help you recognize a credit at a glance. You never type the number; Alfred assigns it. Existing memos and their titles both show as columns in the list so you can scan either way.
Status Lifecycle
A memo flows draft → sent → approved → applied, with partially applied as a stop along the way and rejected or void as exits before it's applied. Each transition is one click on the detail page, and a colored dot next to the Status control mirrors the badge. Two moments are easy to conflate, so Alfred labels them: Approved means the supplier agreed to the credit (you're holding their credit note) — it's still money owed; Applied means you've actually recovered it (offset against an invoice or refunded). Sent is a marker you set yourself — Alfred does not email the supplier, so mark it Sent once you've sent the PDF. The Issue date is stamped automatically the first time a memo leaves draft (whether you mark it Sent or jump straight to Approved). Once a memo is applied it's locked; void and applied are terminal.
Line Items, Reasons & Adjustments
Two kinds of lines. Product lines carry a SKU, quantity, unit cost (the per-unit credit), and a reason — damaged, short-shipped, wrong item, defective, over-received, or Other with a free-text note. Add them from your catalog (search-to-pick) or straight from a linked PO. Other adjustments are amount-only lines for costs with no product behind them — shipping credit, tax credit, or a billing dispute — added through the Add other adjustment dialog. The memo subtotal is the sum of all lines; the total credit is what the supplier owes. Lines seeded from a receive discrepancy are locked to that discrepancy's exact quantity (credit it in full or remove the line), while their unit cost and reason stay editable.
Editing & the Save Bar
On the detail page you edit everything in place — memo title, currency, notes, accounting references, and every line's quantity, unit cost, and reason — then save it all together from the one save bar at the top. Changes are staged as you go (edited and newly-added rows are tinted so you can see what's pending) and committed with a single Save, or thrown away with Discard. Nothing is written until you save, so you can freely add products, add an adjustment, tweak quantities, and delete lines, then commit the whole set at once. Lines stay editable while a memo is draft or sent; from approved onward the financial record is fixed.
Applied (terminal) & Reversal
Applying a credit records how much you recovered and locks the memo — the financial record is immutable. To undo it (supplier reneged, wrong amount, etc.) don't delete it; issue a Credit Memo Reversal. The reversal is a NEW memo that mirrors the original's lines and runs its own short flow: draft → confirm in one click (there's no supplier step — you're undoing your own action). Reversals show their total as a negative value with red tone in the list so the offset reads at a glance, and when both the original and the reversal are applied they net to zero in the summary cards. A reversal's total is capped at the original's total — it can fully or partially offset, but never exceed. You can have one non-void reversal per original at a time.
Write Down the Stock (Inventory Adjustment)
A credit recovers the money; it doesn't touch your on-hand counts. When the credited units were damaged or unsellable and need to come out of inventory, open the memo's More actions menu and choose Start inventory adjustment — Alfred seeds an adjustment session pre-filled from the memo's product lines, ready for you to confirm the write-down. Only one open adjustment can exist per memo; if one already exists, a banner links you straight to it to finish or discard before starting another.
PDF Export (Your Letterhead)
Export to PDF on any memo produces a clean, one-page letter document to email or print for the supplier: a header banner with the memo number, title, and status; an info strip (issue date, currency, accounting references); a From block with your own business details; a line-items table with a dedicated Reason column; and a totals breakdown including any remaining balance. If you've set up more than one business entity, a quick picker lets you choose which to print on — or omit business info entirely. It uses your browser's print dialog, so you can save as PDF or send straight to a printer.
The List & Summary Cards
The Credit Memos page is a full working table: sort by any column, show/hide and reorder columns to taste, and filter by status, supplier, date range, or free-text search. It defaults to newest memo number first. Two summary cards sit on top and respect your filters — Outstanding totals the credits suppliers still owe you (sent, approved, and the unapplied remainder of partially-applied memos), and Recovered totals what you've actually clawed back (applied memos plus the applied portion of partial ones). Both group by currency for multi-currency shops, and an applied reversal nets back out of Recovered.
How to Use
1. Create a credit memo
From the Credit Memos page, click Create credit memo. In the builder, attach a supplier (and a PO if this credit relates to one — that also pre-links it), then add lines: Add products to search your catalog or pull items from the linked PO, and Add other adjustment for shipping, tax, or a billing-dispute amount. Set a quantity, unit cost, and reason on each product line, pick the currency, add any notes, and click Create. You land on the new memo in draft.
1b. Or create from receive-session issues
If the credit came from a receive session, open the PO and look at its Credit Memo Due card. Click Create credit memo to seed a draft with one line per credit-eligible discrepancy (quantity × the PO's unit cost), already linked to that PO and supplier. Adjust costs or remove lines as needed, then continue as below.
2. Edit and send
On the memo in draft, refine anything — title, currency, notes, supplier memo # and vendor bill # (the invoice you're crediting), line quantities, costs, and reasons — and Save from the top bar. Export to PDF and email it to your supplier, then click Mark sent to record that it's out. (Sent is a manual marker — Alfred doesn't send the email for you.)
3. Approve and apply
When the supplier confirms the credit, click Mark approved (or, if you already hold their credit note, jump straight there). When you actually recover the credit against an invoice, click Apply credit and choose Apply in full or Apply partially — a partial application records the recovered amount and leaves the remainder Outstanding. Once fully applied, the memo is read-only.
4. (Optional) Write down the stock
If the credited units were damaged or unsellable and need to leave inventory, open More actions › Start inventory adjustment. Alfred seeds an adjustment session from the memo's product lines; confirm the counts to remove the stock. This is separate from the credit itself — do it whenever the physical write-down is warranted.
5. Reverse (if needed)
Applied a credit in error, or the supplier backed out? Open the applied memo and click Create Credit Memo Reversal. A new draft mirrors the original's lines, pre-named for the original; click Confirm reversal to apply it immediately. The original stays applied as an audit record and the reversal nets it to zero. An applied reversal can itself be voided if you need to walk it back.
Tips & Best Practices
- ✓Set the disposition to 'Expecting credit from supplier' when logging issues at receive time — only credit-disposition issues seed a memo. Replacements, returns, write-offs, and accepted overages are tracked separately.
- ✓You never type the memo number — Alfred assigns CM-1000, CM-1001, … automatically. Use the optional Memo title for a human label like 'Damaged shipment — March freight' so credits are easy to find later.
- ✓Everything on the detail page saves together from the one save bar. Add products, add an adjustment, fix quantities, and delete lines freely — pending rows are highlighted — then commit the whole set with a single Save (or Discard to revert).
- ✓Adjust the unit cost before sending. A from-PO or from-issues draft starts at the PO's cost as an estimate; set it to the credit you actually negotiated.
- ✓Export to PDF before you mark a memo Sent — that's the document your supplier needs, on your own letterhead. Set up your business entity (and pick which one at export time) so it prints correctly.
- ✓A credit recovers money but doesn't move inventory. When damaged units need to come off the shelf, use More actions › Start inventory adjustment to write them down from the memo's lines.
- ✓Reversal is the recovery path for an applied memo — never try to delete it. The original stays as an audit record and the reversal nets it back to zero.
- ✓On the list, filter by supplier or status and reorder columns to match how you work; the Outstanding and Recovered cards update with your filters and date range.