The Difference Between AP And AR Deductions
- Accounts Payable Deductions
- Accounts Receivable Deductions
- Disputing Deductions
Deductions are a point of pain for many suppliers. It’s even worse if you’re not sure where they’re coming from. Here’s the difference between Accounts Payable (AP) and Accounts Receivable (AR) deductions.
Accounts Payable Deductions
AP deductions are from Walmart’s accounts payable department. AP deductions mean that Walmart paid one of your invoices but withheld payment for all or part of the invoice because of something that occurred related to that particular invoice.
AP deductions generally come with a code tied to them. We have compiled a list of common Walmart deduction codes that you will see on your invoices. We have also gone further in-depth into the most common Walmart deduction codes and what you can do about them.
There are some AP deductions codes that are not tied with a particular invoice, however. Return codes such as code 94s and code 92s don’t always relate to an invoice but are still AP claims.
An AP deduction will come straight from the remittance that Walmart sends you after you have invoiced it. You can view these deductions and their codes in APIS in Retail Link. If the deductions are valid, there is no action needed on your part. The money will simply be deducted from your remittance. You may see deductions on as many as all of your checks.
AP deductions will explicitly show you the reason for your deductions on the check itself. It will show the PO number, the invoice number, the affected distribution center, and the microfilm number. These numbers will be relevant to the PO.
An accounts payable deduction
What Do I Do about Invalid AP Deductions?
AP deductions are disputed using the Accounts Payable Dispute Portal (APDP). Generally speaking, you’ll need proper documentation regarding the order, such as invoices, purchase orders, and proofs of delivery.
Accounts Receivable Deductions
AR deductions are from Walmart’s accounts receivable department. AR deductions mean that at some point Walmart came across something that inclined them to believe that you owed them money, so Walmart invoiced you. These invoice numbers often begin with “7000…”.
AR claims are for chargebacks such as OTIF fines for which Walmart will invoice you once a month. These charges also include Truck Ordered Not Used (TONU), Detention, Bluebox (CA), Excessive Defective Invoices, among others.
AR deductions are also for lumper fees (also known as unloading fees) that Walmart will levy in bulk increments of $50 for unloading trucks.
AR deductions can be viewed and disputed in the High Radius portal.
An AR deduction will be sent to you as an invoice. You can view these deductions in High Radius, which will show you the specific amount of the invoice. You have 30 days to pay the invoice or to challenge it. If you do not take care of it in that timeframe, then it will likely come off the next remittance Walmart sends you. For some suppliers, it won’t come off the check, but they will be dropped into a collections process. This is a more rare scenario, however.
AR deductions usually will not show a deduction reason or PO number. For the store number, it will often show 9000, and for the division, 0005. The invoice number will often start with 7000, and the microfilm number will be more than five non-zero digits.
An accounts receivable deduction
A microfilm number refers to the physical microfilm of the deduction information. Walmart keeps a hard copy of claim backup information for manually-generated claims and payments. To access this backup information, you must submit a Request for Backup form (requires login). Information for auto-generated claims is stored in APIS in Retail Link.
What Do I Do about Invalid AR Deductions?
Some AR deductions may be challenged, and even OTIF fines can sometimes be disputed. AR deductions are disputed in High Radius and may require specific documentation.
For more information on disputing AP and AR deductions, view our post on How to Dispute a Walmart Deduction.
Visibility and One-Click Disputing with SupplyPike
The SupplyPike Solution gives you full visibility into your Walmart accounts payable deductions. We directly connect to your retailer, carriers, 3PLs, and dispute portals to give you a better understanding of your deductions and allow you to dispute with the click of a button.
SupplyPike also has solutions for the convoluted world of AR deductions. Fight a variety of invalid deductions and stop compliance issues at their root with SupplyPike's Compliance Solution.
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Written by The SupplyPike Team
About The SupplyPike Team
SupplyPike builds software to help retail suppliers fight deductions, meet compliance standards, and dig down to root cause issues in their supply chain.Read More