## Documentation Index

Access the complete documentation index at:
https://www.zoho.com/bh/books/help/llms.txt

Use this file to discover all available documentation pages before proceeding.

# Netting

 ![](/books/images/ue-resources/llm-utility-menu/sparkle-ai.svg) Explore With AI ![](/books/images/ue-resources/llm-utility-menu/dd-arrow.svg) 

*   [Open in ChatGPT (opens in new tab)](https://chatgpt.com/?prompt=Analyze+the+content+of+https%3A%2F%2Fwww.zoho.com%2Fbh%2Fbooks%2Fhelp%2Faccountant%2Fnetting.html+and+understand+it+thoroughly+so+I+can+ask+questions+about+it.)
*   [Open in Claude (opens in new tab)](https://claude.ai/new?q=Analyze+the+content+of+https%3A%2F%2Fwww.zoho.com%2Fbh%2Fbooks%2Fhelp%2Faccountant%2Fnetting.html+and+understand+it+thoroughly+so+I+can+ask+questions+about+it.)
*    ![Copy for LLM](/books/images/ue-resources/llm-utility-menu/copy.svg) Copy for LLM
*    [![View as Markdown](/books/images/ue-resources/llm-utility-menu/md.svg) View as Markdown (opens in new tab)](/bh/books/help/accountant/netting.md)

The **Netting** module in Zoho Books lets you offset Accounts Receivable (AR) and Accounts Payable (AP) balances for customers and vendors who are linked in your organization. When you offset the balances, the Accounts Payable amount you owe the vendor is deducted from the Accounts Receivable amount the vendor owes you. This lets you settle both balances through a single netting entry instead of creating separate customer and vendor payments.

**Scenario:** Lily at Zylker has issued invoices totaling $5,000 to ABC Supplies for services rendered. ABC Supplies is also a vendor and has sent bills totaling $3,000 to Zylker. Instead of creating separate payment transactions for the customer invoices and vendor bills, Lily creates a netting entry to offset the $3,000 accounts payable (AP) balance against the $5,000 accounts receivable (AR) balance. After netting, Zylker has a net receivable of $2,000 from ABC Supplies.

## Enable the Netting Module

To enable the Netting module:

*   Go to **Settings**.
*   Navigate to _General_ under **Setup & Configurations**.
*   Check the **Netting** option under _Select the modules you would like to enable_.
*   Click **Save**.

![Enable Netting](/books/help/images/accountant/enable-netting.png)

Once enabled, the Netting module will be available under **Accountant** in the left sidebar.

* * *

## Create a Netting Entry

To create a netting entry:

*   Go to **Accountant** on the left sidebar and select **Netting**.
*   Click **\+ New** in the top right corner of the page.
*   In the _Create Netting Entry_ page, fill in the following details.

Field

Description

Customer Name

Select a contact who is linked as both a customer and a vendor. Once selected, the associated vendor record is identified automatically. You can also view the current Accounts Receivables, Accounts Payables, and maximum Nettable Amount for the contact.

Select Currency

Select a currency to view transactions in the selected currency.

Date

Select the netting date. All outstanding invoices and unpaid bills created on or before this date are listed in the _Pending Invoices_ and _Pending Bills_ sections.

Netting#

The netting reference number, auto-generated based on your transaction series. Click the _Gear_ icon next to the field to configure the number series or enter a number manually.

Once you fill in the details, the _Create Netting Entry_ page will display two sections side by side, **Pending Invoices** and **Pending Bills**. Both sections list the outstanding transactions for the selected customer/vendor as of the netting date.

*   Click the **Filter by Date Range** dropdown, select a start date and an end date, and then click **Apply Filter** to view transactions within the selected date range.
*   Click the **Location** dropdown and select a location to view its transactions, or choose **All Locations** to view transactions across all locations.
*   Select the checkbox next to an invoice or bill to include it in the netting entry.

**Note:** A maximum of 20 transactions, combining invoices and bills, can be included in a single netting entry.

*   Enter the amount to apply in the **Amount Applied** field for each selected transaction.

The **Applied Receivables** and **Applied Payables** totals are displayed at the bottom of their respective sections and update automatically as you select transactions and enter amounts. To save the netting entry, the Applied Receivables and Applied Payables totals must be equal.

The **Balance After Netting** displays the net balance that will remain after the entry is applied.

*   Click **Save**.

![Create Netting Entry](/books/help/images/accountant/create-netting-entry.png)

**Note:** You can also create a netting entry directly from a contact that is linked as both a customer and a vendor. To do this, go to **Sales/Purchases** > **Customers/Vendors** > select a customer or vendor > click **More** > select **Create Netting Entry**.

After you save a netting entry, it is marked as **Published**, and the selected invoices and bills are marked as **Paid** as of the netting date.

* * *

## Delete a Netting Entry

**Warning:** Deleting a netting entry is permanent and cannot be undone. The invoices and bills that were marked as Paid through the entry will revert to their previous outstanding status.

To delete a netting entry:

*   Go to **Accountant** on the left sidebar and select **Netting**.
*   Select the netting entry you want to delete.
*   Click the **Delete** icon in the details page of the netting entry.

![Delete Netting Entry](/books/help/images/accountant/delete-netting-entry.png)

*   In the confirmation pop-up, click **Delete** to confirm.

The netting entry will be deleted.