Reversing Disbursement Cheques after it has been Invoiced & Paid

17/03/2026
Knowledge

How To

If a disbursement cheque invoiced to a client is voided or reimbursed by a third party after the invoice has already been paid by the client, the following steps outline how to reverse the disbursement cheque and correct the matter’s balance:

Reverse the Bank deposit and Receipt allocated against the invoice that includes the respective disbursement cheque.
Reverse the invoice to remove the billed disbursement from the client’s account.
Reverse the disbursement cheque that was voided or reimbursed by a third party.
Reissue the invoice for the correct amount, excluding the disbursement that was reversed.
Re-enter the client receipt for the original payment amount.
- Apply the appropriate reduced portion to the corrected invoice.
- Record the remaining amount as a retainer or credit on the client’s matter.

Once the Retainer & Credit balance has been created on the matter, you can decide whether to apply it to the next invoice, transfer the overpayment from the general bank to the trust bank, or refund the amount directly to the client from the general bank. All these options can be processed from the General Accounting’s ‘Retainer & Credits’ section Retainer & Credits Ledger.

Last Modified Date

17/03/2026 1:36 am

Title

Reversing Disbursement Cheques after it has been Invoiced & Paid

URL Name

Reversing-Disbursement-Cheques-after-it-has-been-Invoiced-Paid-CA

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