Remittance Advice

A remittance advice is a notice from a payer to a supplier explaining which invoice or invoices a payment is intended to settle.

It helps the supplier match one bank deposit to the correct customer account. This is especially useful when a payment covers several invoices, includes a credit note, deducts an agreed amount or pays only part of an invoice.

A remittance advice may be a PDF, email, portal notification or structured electronic message. It usually travels separately from the bank transfer, although payment software may create and send it at the same time.

What A Remittance Advice Usually Includes

Useful details include:

• payer and supplier names
• payment date and total amount
• bank or payment reference
• each invoice number and amount paid
• any credit note, discount, withholding or adjustment
• payment currency
• contact details for questions

The Australian Therapeutic Goods Administration requires a summary of the relevant invoices in a remittance advice for bank transfers. This illustrates its central purpose: helping the recipient allocate the payment accurately.

Remittance Advice Versus Similar Documents

A remittance advice is not the payment itself. Sending one does not prove that cleared funds reached the supplier’s account. The supplier should still confirm the deposit and reconcile it to the advice.

Simple Example

A retailer owes a supplier $800 on invoice INV-410, $500 on INV-427 and $300 on INV-431. It also has a $100 credit note.

The retailer transfers $1,500 and sends a remittance advice listing the three invoices and the $100 credit. The supplier can match the single deposit to four items and close the correct balances in accounts receivable.

Why Remittance Advice Matters

Without clear remittance details, a supplier may receive money but not know which invoices to mark as paid. That can leave customer statements wrong, trigger unnecessary collection messages and create unidentified cash.

Australian local-government supplier payment guidance provides a practical example: its EFT remittance advice details the invoices paid. The same discipline helps any business with multi-invoice or high-volume supplier payments.

Remittance advice also creates an audit trail between the approved bills, payment batch, bank movement and supplier account.

Common Remittance Advice Mistakes

• listing an invoice number that differs from the supplier’s document
• sending an advice before a payment is approved, then not correcting it
• showing only a total when several invoices or credits are involved
• omitting currency or deductions
• assuming the advice proves that funds have cleared
• emailing sensitive banking information without appropriate controls

How Gimbla Can Help

Keeping supplier bills, credits and payments together in Gimbla makes it easier to identify what a payment covers and verify the details used in a remittance advice. Bank reconciliation can then confirm that the actual payment agrees with the accounting record.

For strong payment controls, review supplier bank-detail changes separately from the remittance process and use the invoice numbers already stored in accounts payable.

Related Terms

• Accounts Payable
• Accounts Receivable
• Invoice
• Credit Note
• Bank Reconciliation
• Audit Trail

Helpful Gimbla Guides

• Purchase Order To Supplier Bill
• Bank Reconciliations
• Bill Scanner For Small Business

In Short

A remittance advice explains which invoices, credits and adjustments are covered by a payment. It helps the supplier allocate cash correctly, but it is not proof that funds have cleared.