Lido extracts credit memo and debit memo data, amounts, reference numbers, original invoice numbers, and reason codes, then matches each adjustment to the original invoice in your AP ledger. The output is a net adjustment spreadsheet ready for your month-end reconciliation, with no manual cross-referencing required.
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Credit memos and debit memos are adjustments to amounts your AP team already has in flight. When they arrive out of sync with the original invoice, they create reconciliation headaches. Lido processes them in the same pipeline as invoices so adjustments are always matched and netted.
Vendors issue credit notes for returned goods, billing errors, early payment discounts, and contract adjustments. They arrive by email as PDFs, through the same channels as invoices. Lido classifies each document as a credit note or debit memo based on content and processes it through the appropriate extraction schema.
From each credit memo: vendor name, credit memo number, date, original invoice number being credited, line items credited (item description, quantity returned, unit price, extended amount), total credit amount, reason code (return, price adjustment, duplicate payment, discount), and any reference notes. Same structured extraction regardless of vendor format.
Lido looks up the original invoice number in your AP ledger or extracted invoice register and links the credit memo to it. If the reference number in the credit memo matches exactly, the link is automatic. If the reference uses a slightly different format — "INV-2026-0441" vs "Invoice #0441", fuzzy matching resolves the link.
A credit memo that references an invoice number not in your ledger is flagged as unmatched. Your AP team sees the credit memo content and can manually link it, request clarification from the vendor, or flag it as a credit against a future invoice. Nothing falls through the cracks.
The output is a structured spreadsheet showing each vendor's open invoices, the credits applied to each, the net payable amount, and the reason for each adjustment. Payment run inputs use net amounts. Month-end close reconciliation uses the same data without any additional manual computation.
Upload a batch and get structured output in minutes.
Credits issued by vendors for returned merchandise, overbilling corrections, and contract adjustments. Any credit note format from any vendor.
Internal debit memos and vendor-issued debit notes for additional charges, freight adjustments, and retroactive price changes.
Credit notes issued when you take a 2/10 net 30 early payment discount. Lido extracts the discount amount and links it to the invoice for net payment calculation.
Credits issued after goods are returned. Lido extracts the RMA number, returned items, quantities, and credited amounts.
Credits from vendors correcting an overcharge on a prior invoice. The original invoice amount and the corrected amount are extracted alongside the credit.
Credits issued when a vendor acknowledges receipt of a duplicate payment. Lido flags these and links to both the original and duplicate payment records.
A vendor emails a credit note for $2,340 — a return from last month that finally cleared their system. The AP coordinator downloads the PDF, opens the accounts payable spreadsheet, manually finds the original invoice for $8,940, and types in the credit. The net payable is now $6,600. If the credit note arrives after the payment run, the full $8,940 gets paid and the $2,340 credit sits as an open item in the vendor's account, potentially forgotten until the next statement reconciliation, or never.
Lido processes credit memos alongside invoices. Each credit is matched to the original invoice, the net payable is calculated automatically, and any credit that arrives after the payment run is tracked as an open credit balance against the vendor. Month-end close starts with a complete, reconciled picture, not a pile of PDFs to manually sort through.
| Feature | Lido | Manual process |
|---|---|---|
| Extract credit memo fields from any vendor format automatically | ✓ | ✗ |
| Match credit memos to original invoices by reference number | ✓ | ✗ |
| Flag unmatched credits for review instead of dropping them | ✓ | ✗ |
| Calculate net payable per vendor for payment run | ✓ | ✗ |
| Track open credit balances against future invoices | ✓ | ✗ |
| Open the PDF and manually update the spreadsheet | ✓ | ✓ |
Process credit memos in the same workflow as invoices so nothing falls through the cracks at month-end.
A manufacturer returns defective components to three suppliers per month on average. Credit notes arrive 2–4 weeks after the return. Lido matches each credit to the original purchase order and invoice, netting the adjustment before the supplier's next payment run.
Distributors receive promotional credits from suppliers, volume rebates, co-op advertising credits, and new product launch allowances. Lido extracts each credit, links it to the vendor account, and includes it in the net payment calculation.
When a client disputes a line item, the firm issues an internal debit memo reducing the receivable. Lido extracts the adjustment, links it to the original invoice, and produces an updated net receivable for the account.
Intercompany transactions generate credits when one entity overbills another. Lido processes intercompany credit memos and matches them to the original intercompany invoices, producing a net intercompany balance for elimination at consolidated close.
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