When a payment for a settlement fails, Amazon includes that as part of the next settlement instead.
This results in you having a settlement in Xero which has a positive total but no bank transaction to reconcile against.
The solution is to add a line to the settlement invoice in Xero for the one where the payment failed.
In this example the €14.19 settlement payout failed:
The amount was then rolled into the next settlement for €37.04.
In Xero on the €14.19 invoice -
You would add the line:
Description: Amazon Reserved Balances - Failed to transfer funds
Account: Amazon Reserved Balances ( LMB9 )
Tax rate: No VAT
Amount: -14.19
Qty: 1
This will move the €14.19 to the Amazon reserved balances account and mark the invoice as paid.
Then if we take a look at the settlement that came after the €14.19 one, the one where Amazon included that €14.19 amount you will see their is a line item on that one with the same description and an amount of €14.19:
So in effect what is happening here is you are adding -€14.19 to the reserved balances account by manually adding that line item to the first invoice and then in this second invoice €14.19 is being added to the reserved balances account.
So the reserved balances account balances out to 0 again and your first invoice has the new total of 0, which it should have as no payment was made. Then the second invoice reconciles off against the payment received into the bank account.
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