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Best practice for not paying retainage

  • 21 March 2023
  • 5 replies
  • 110 views
M
Rank

Hi,

Would anyone know how to best handle scenarios where you don’t want to pay the whole or a portion of AP retainage to the subcontractor?

I’m thinking of a scenario where the general contractor ends up doing a warranty repair themselves or contracting a different sub to do the work so they keep the retainage.

The release AP retainage screen allows you to do a partial release but keeps the remaining amount open. I’ve tried posting debit adjustments as well but the system does not allow referencing retainage bills.

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Best answer by aaghaei 21 March 2023, 05:08

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5 replies

V
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Userlevel 7
Badge +11

Hi @marionmarchan75 

You need to release the retainage, which generates retainage Bill. You can create a Debit adjustment separately crediting appropriate GL account. Apply the Debit adjustment to the retainage Bill generated.

Hope this helps. 

Regards,

VijayKumarU
M
Rank

Thanks Vijay! The solution works. It failed our first test because there was already an unreleased payment against the retainage bill.

aaghaei
Rank
Userlevel 7
Badge +8

When you are releasing the retainage, although the system itself will suggest the whole remaining balance, the amount is editable and you can override to a lower amount and short pay as you wish.

Reza Aghaei CPA, M. Acc. & Acumatica Customization - If a member helped you, please *Like* their post. If a member provided an answer to your question, please mark it as *Best Answer*.
M
Rank

Hi @aaghaei ,

 

We’ve tried doing that but the retainage balance remains open. In our scenario we intend not to pay the subcontractor the remaining amount and close of the invoice. 

aaghaei
Rank
Userlevel 7
Badge +8

Right, in this case, you will need to release the whole retainage and post a debit adj and offset it with the released retainage bill.

Reza Aghaei CPA, M. Acc. & Acumatica Customization - If a member helped you, please *Like* their post. If a member provided an answer to your question, please mark it as *Best Answer*.

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