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Thread: Refunding to 3rd party

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    Question Refunding to 3rd party

    Good morning, I am just wondering about the following:

    If your company sells assets (Machinery) and most of the machinery is over R100 000. Most of the clients gets funded externally through banks and various other parties like government organizations for economic development etc. Now if a client gets funded, an invoice gets sent to the 3rd party funding the client and they pay the company directly, what are the implications on the company's bookkeeping side if the 3rd party funder pays out an extra amount that needs to be payed over to the client?

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    Site Caretaker Dave A's Avatar
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    Kinda feeling this one over for catches.

    If you invoiced the 3rd party, are they the really the 3rd party to you?

    If they are now your client, you would pay out the refund according to their directions (and I suggest get those instructions in writing).

    From an accounting point of view, processing a refund payment is a pretty standard process.
    Debit the debtors account and credit the bank account.
    The trouble with opportunity is it normally comes dressed up as work.

  3. #3
    Platinum Member sterne.law@gmail.com's Avatar
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    If it's government parties in the mix, its sounding somewhat dodgy.
    If anything it should be paid straight back.
    Anthony Sterne

    www.acumenholdings.co.za
    DISCLAIMER The above is merely a comment in discussion form and an open public arena. It does not constitute a legal opinion or professional advice in any manner or form.

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