Open items: debtor - What are open items: debtor?
Open items on the debtor side are any sales invoices that have yet to be paid and any customer receipts posted to the customer ledger but not matched to the corresponding invoices
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An open item can be either on the debtor side or the creditor side of your accounts. Open items on both sides should be settled or cleared as soon as payments are received or made. For more about the creditor side, see open items: creditor for more details.
Open items: debtor in accounting
In accounting, an open item on the sales side means that the order is still open and since payment has not yet been received, the invoice remains ‘open’ and is expected to be settled at a later date, when it will be matched. If it cannot be matched, it should be cleared.
When you run an aged debtors report it will show all invoices that are unpaid at that date along with any customer receipts which have not been matched with the invoice. This report should be a mirror image of the Debtor Control Account in the balance sheet.
Clearing unmatched customer receipts
It is important to clear any unmatched customer receipts especially if you are using the Cash Accounting VAT Scheme as this is the trigger in sending the VAT amounts on your VAT return.
If you have processed a sales invoice in a currency different from your base account currency (the customer receipt must also be processed in the same currency as your sales invoice) by matching the invoice to the receipt, many accounting systems today automatically generate the exchange gain or loss and post the amount.
Open items and accounting software
Managing unpaid invoices can be done at a glance with online accounting & invoicing software. Quickly filter your invoices based on payment status and follow up on any open amounts still due to your business with Debitoor.