How to Identify and Flag Unapplied Payments in NetSuite ERP for Cash Application Automation

📌 Unapplied payments can distort your AR reporting and delay reconciliation. NetSuite ERP offers standard tools to help you surface these payments, flag them for review, and apply them to open invoices. Even without SuiteScript or third-party tools, you can streamline your month-end close using a combination of reports, saved searches, and workflows.

Below is a step-by-step guide for finance teams using native NetSuite capabilities.

How to Spot and Action Unapplied Payments

Step 1: Run a Report to Identify Unapplied Payments

Go to: Reports > Customers/Receivables > A/R Payment History by Payment. This built-in report shows all customer payments, including whether they are applied or unapplied.

• Look for records where the "Applied Amount" is less than the "Amount".
  
  
• Filter the report to show only payments with a status of “Unapplied”.

You can export this report or use it alongside a saved search for tracking purposes.

Step 2: Create a Saved Search for Unapplied Payments

Go to: Reports > Saved Searches > New > Transaction. Set the transaction type to Customer Payment. Under Criteria, use: Amount is not equal to Applied Amount.

Under Results, include:

• Date
  
  
• Customer
  
  
• Amount
  
  
• Applied Amount
  
  
• (Optional) Days Since Created

This gives you a live list of unapplied payments for review and follow-up.

Step 3: Add a Custom Field to Flag for Review

Go to: Customization > Lists, Records, & Fields > Transaction Body Fields > New
Create a checkbox field named Needs Review, and apply it to Customer Payment transactions. Then, update your saved search to include this field so users can quickly flag records in bulk. This is useful when multiple teams are involved in payment review or approval.

Step 4: Manually Apply Payments to Invoices

Go to: Transactions > Customers > Accept Customer Payments. Click Edit on any payment from your search or report. Under the Apply subtab, check off the open invoice(s) that match the payment amount and click Save. The payment will now show as applied and will no longer appear in your search/report.

Step 5: Automate Review Reminders with SuiteFlow

Go to: Customization > Workflow > Workflows. Create a new workflow triggered on Customer Payment records. 

Set a condition:

• Needs Review = True
  
  
• AND Days Since Created > 7

Action:

• Send an internal email to the AR owner or finance team reminding them to resolve or escalate the unapplied payment.

This helps prevent lingering unapplied balances before the month-end hits.

Pro tip: If you want deeper cash application automation, including automatic pairing of partial or overpayments and real-time routing to the right collector, use Growfin. The platform reads NetSuite data continuously and closes unapplied items before they ever clog your month-end.