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The reversal feature in Dynamics 365 Business Central is a handy tool. It gives the user all types of ways to cleanly reverse out transactions, including NSF customer checks. The problem is, to reverse them, those checks must bounce in the same period they are received, and as anyone who has done a bank reconciliation will tell you, that is rarely the case. For starters, let us see what happens in D365 Business Central when we try to reverse an entry that has already been cleared in the bank reconciliation. Below is the entry we will use for our example. As you can see, it is green, which means it has been marked as cleared.
1. Let’s assume that in the subsequent bank statement, this payment has been marked as NSF by the bank, so we need to reverse it out. Let’s go to the customer card for Alpine Ski House, access the customer ledger entries, and try to reverse out the customer payment. First you will need to unapply the payment (Process > Unapply).
2. The next step would normally be to reverse the entry (Process > Reverse Transaction). However, when the payment has already been cleared in the bank reconciliation, this is where we get into trouble. The error you will receive is below. How do we get around this? Well, if the NSF is in the same period the payment was received, it’s easy. Unclear the entry in the bank reconciliation and run the reversal again. All set.
3. But what if the payment was received in June but the NSF is in July? If you unclear the bank reconciliation entry, you will be out of balance for June. The fix must happen in July. Luckily, the fix is an easy one. Here are the steps:
4. Here is a screenshot of our entry:
5. If you would like, preview the posting. If it looks good, go ahead and post. You should be all set now. You will see a new bank account ledger entry in your bank reconciliation.
We realize this method is not as easy as simply marking a payment as NSF and having the offsetting cash entries automatically made for you. However, once you get the hang of it, this should be a relatively quick and painless workaround.