A debit note is a document issued by a buyer to a supplier that formally claims a reduction of an amount already invoiced, notifying the supplier of a deduction ahead of the matching credit note.
A debit note and a supplier credit note describe the same adjustment from opposite sides. The buyer issues the debit note to state what it intends to deduct. The supplier issues the credit note to accept that adjustment and record it. Until the credit note exists, only one of the two ledgers carries the correction.
Debit notes are typically raised for four situations:
- a price billed above the agreed supplier price book or contract rate
- goods returned, damaged on arrival, or short delivered against the purchase order
- a contractual rebate, marketing contribution, or volume bonus owed back to the buyer
- a logistics penalty for a late or non-compliant delivery
The reconciliation risk sits in the unilateral deduction. A buyer that subtracts the debit note amount from its next payment run before the supplier has accepted it creates a permanent gap: the supplier account shows an unpaid balance, the buyer shows a settled one, and the difference resurfaces months later during a supplier statement reconciliation.
Phacet detects the billing discrepancy that would justify a debit note at the moment the supplier invoice is received, by comparing the invoiced price against the purchase order and the negotiated price book. Correcting the amount before payment removes the need for a debit note at all.
