Case 15: Charge Line - Charge Per Unit Outside Tolerance (Rejected)

Scenario:

The header charge per unit is outside tolerance and has not been approved.

Action:

The system adjusts the header charge to match the purchase order, processing the transaction accordingly, and generating any necessary notes.

Example:

• Purchase Order (PO):

  • Header Charge Per Unit: $4.00

  • Quantity: 1,500 units

  • Total Header Charge Amount: $6,000.00

• Invoice Received:

  • Header Charge Per Unit: $5.00 (outside tolerance of 25%, rejected)

  • Quantity: 1,500 units

  • Total Header Charge Amount: $7,500.00

• Tolerance Levels:

  • Header Charge Per Unit Tolerance: ±5%

Since the header charge per unit ($5.00) exceeds the acceptable tolerance range of 5% and has not been approved, the system will:

1. Reject the Invoiced Header Charge Per Unit: The system does not accept the invoiced header charge per unit of $5.00 due to the variance exceeding the tolerance limit.

2. Adjust the Header Charge Per Unit: The system adjusts the charge per unit to match the original purchase order or the approved charge per unit:

   • Adjusted Header Charge Per Unit = $4.00 (from PO)

3. Recalculate the Total Header Charge Amount: The system recalculates the total charge amount based on the adjusted charge per unit:

   • Corrected Total Header Charge Amount = Quantity × Adjusted Header Charge Per Unit

   • Corrected Total Header Charge Amount = 1,500 units × $4.00 = $6,000.00

4. Generate a Credit Note: Since the original invoice total was higher than the corrected total, the system generates a credit note for the overcharged amount:

   • Credit Note Amount = Original Invoice Total - Corrected Total Header Charge Amount

   • Credit Note Amount = $7,500.00 - $6,000.00 = $1,500.00

5. Process the Invoice: The system processes the invoice with the corrected total charge amount of $6,000.00 and issues a credit note for $1,500.00 to account for the overcharged amount.

This approach ensures that the transaction is aligned with the original terms of the purchase order, maintaining accurate financial processing while correcting any overcharges.