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Link Supplier and Customer with Common Party Accounting

Common Party Accounting is used when the same business party is both a Customer and a Supplier.

For example, a company may usually buy from a party and record Purchase Invoices against them as a Supplier. Later, the same party may buy goods or services from the company, so a Sales Invoice needs to be raised against them as a Customer. Common Party Accounting lets ABNERP link these two party records and adjust balances between them.

This is useful when receivables and payables belong to the same real-world party.

When to use Common Party Accounting​

Use this feature when:

  • The same party exists as both a Customer and a Supplier.
  • You want to adjust a Sales Invoice against a Purchase Invoice, or the other way around.
  • You want ABNERP to create the accounting adjustment automatically when the invoice is submitted.

Example scenario​

A company has been buying from a Supplier and has unpaid Purchase Invoices. Later, the same Supplier buys something from the company. To record this, the company creates a Customer record for the same party and raises a Sales Invoice.

Instead of separately collecting money and paying the supplier, the outstanding amounts can be adjusted through Common Party Accounting.

Setup steps​

1. Enable Common Party Accounting​

Go to:

Accounts Settings \u003e Enable Common Party Accounting

Enable the setting and save Accounts Settings.

2. Create or identify both party records​

Make sure the party exists in both roles:

  • Customer
  • Supplier

These are separate master records in ABNERP, even if they represent the same real-world organization.

Create a Party Link between the two records.

If the primary party is a Supplier:

Supplier \u003e Actions \u003e Link with Customer

If the primary party is a Customer:

Customer \u003e Actions \u003e Link with Supplier

ABNERP creates a Party Link so it knows that the Customer and Supplier represent the same party.

Transaction flow​

Enable Common Party Accounting
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        v
Create Customer and Supplier records
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        v
Link Customer and Supplier using Party Link
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        v
Create invoice against the secondary party
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        v
Submit invoice
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        v
ABNERP creates adjustment Journal Entry
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        v
Use the advance to reconcile the linked invoice

What happens after invoice submission​

After the linked invoice is submitted, ABNERP checks whether Common Party Accounting is enabled and whether a Party Link exists.

If both conditions are met, ABNERP automatically creates a Journal Entry. This Journal Entry creates an advance balance against the linked party.

For example:

  • A Sales Invoice is created against the linked Customer.
  • ABNERP creates an advance against the linked Supplier.
  • That advance can then be reconciled against a Purchase Invoice for the Supplier.

The same idea applies in the opposite direction when the linked party relationship is reversed.

Reconciliation​

Once the Journal Entry is created, use the advance amount to reconcile the outstanding invoice of the linked party.

For example, if a Sales Invoice created an advance against the Supplier, that advance can be used to reconcile an outstanding Purchase Invoice.

Important notes​

  • Common Party Accounting works only when the Customer and Supplier are linked using Party Link.
  • The feature must be enabled in Accounts Settings before ABNERP can create the automatic adjustment.
  • Customer and Supplier remain separate masters. The link only tells ABNERP that they represent the same business party for accounting adjustment.
  • Review the generated Journal Entry before reconciliation, especially when using multiple currencies or different receivable and payable accounts.

Summary​

Common Party Accounting helps adjust receivables and payables when the same party is both a Customer and a Supplier. After enabling the setting and linking both party records, ABNERP can create the required Journal Entry automatically and make the balance available for reconciliation.