Cash collected from customers in Xero: payments minus refunds
Collections answer a plain question: how much did customers pay against their invoices, after refunds? The definition matters, because it is narrower than every dollar that reached the bank.
By Manny Sidhu · Practical guide · Published · Updated
The calculation
Ask Alex adds up the payments recorded in Xero against sales invoices, by payment date, and subtracts the refunds paid back to customers in the same dates. The result is net recorded invoice collections.
The answer shows three figures: invoice payments, customer refunds, and the net of the two.
What counts as a payment and as a refund
A payment counts when Xero records it against a sales invoice. Refunds are money paid back to a customer against a credit note, an overpayment, or a prepayment.
Only payments with an authorised status are included, and deleted payments are left out. The amounts are what Xero recorded as paid, so they include any tax on the invoices.
An illustrative example
Illustrative example, not customer data: in August, customers paid A$184,800 against sales invoices, and A$6,600 was refunded against credit notes. Net recorded invoice collections are A$178,200.
What this figure leaves out
This is not every dollar received. Money received as a prepayment or an overpayment, and money recorded as a receive-money transaction, is not counted as a payment, so the figure can be lower than your bank deposits. It is also not a bank balance, and not the revenue in your profit-and-loss report.
If a payment record is incomplete, or payments are in more than one currency, Ask Alex declines rather than giving a partial total. If your dates hold more payments than one check can verify, it asks for a shorter date range.
Dates and synced history
Days outside the Xero history AirCEO has synced are not counted as zero. When only the last day of your range is missing, Ask Alex answers for the days before it and states the date it stopped at.
To compare with the previous period of the same length, ask how collections changed. That answer uses the same definition and splits the change by customer, as the guide on customer payments falling this quarter explains.
What each answer shows
Every Ask Alex answer lists its source, scope, time, assumptions, and calculation, along with the Xero payments and refunds behind the totals. The figures are calculated by code from those records.