You can use Accounts Receivable to account for retainage (or a "holdback") that occurs when your customer withholds a percentage of an invoiced amount, usually by mutual agreement or according to a statute (such as a Builders Lien Act).
Before you can process retainage in Accounts Receivable, you must:
- Set the Retainage Accounting option on the Processing tab of the A/R Options screen.
- Specify retainage settings for customers on the Retainage tab of the A/R Options screen.
- Specify a retainage account for each account set in your Accounts Receivable system on the A/R Options screen.
Retainage Document Numbering
Accounts Receivable assigns the next available invoice, credit note, or debit note batch number to the retainage batch. You specify the numbering system for retainage documents on the Retainage tab of the A/R Options screen.
Optional Fields
Accounts Receivable inserts on retainage documents any optional fields and values specified on original invoices, credit notes, and debit notes when you create a retainage batch. You do not specify optional fields and values separately for a retainage batch.