If you've ever stared at your accounts wondering why a payment doesn’t match, or had a client insist they’ve paid when your books say otherwise—you’re not alone. It’s a common headache for many small businesses. And more often than not, the issue traces back to one thing: invoices being edited after they’ve already been sent.

This month, I’m sharing a real case from one of my own clients. It shows exactly how invoice errors can snowball into bigger problems—and what to do instead.

Client X runs a service-based business and works with multiple industries across New Zealand. They use Xero to send invoices directly to their clients. As the business grew, they hired an accounts assistant to manage invoicing and day-to-day bookkeeping. Everything looked fine on the surface—until a pattern of mismatched payments started to emerge. Clients were being reminded of overdue invoices they believed they had already paid. Confusion grew, and so did tension.

The issue came down to how invoice corrections were handled. Whenever an amount needed adjusting—due to client feedback, a missed item, or an error—the assistant simply opened the original invoice in Xero and edited it. This might seem like a time-saver, but here’s what actually happened:

Clients received the first version of the invoice via email or through their internal systems. When the invoice was updated later in the system, clients weren’t always told about the changes. Because the invoice number stayed the same, the client’s system didn’t pick up the new version

This meant clients paid the original amount, while Xero now expected a different figure. 

On paper on your side, it looked like they had underpaid/overpaid—even though they paid on what what they received originally. The result was a mess of short payments, overpayments, and missed follow-ups. Clients were confused, payments were delayed, and Client X’s records became harder to trust.

After the in-house assistant left, Client X brought me in to clean up the accounts and recover overdue payments. As I started reaching out to clients, I quickly noticed the pattern. Some clients were adamant they had paid in full. Others forwarded remittance advice or screenshots showing the invoice as settled in their system. The deeper I went, the clearer the issue became: invoices had been changed after they were sent, without a clear best practice process or proper communication.

To untangle this, I requested remittance advice from client’s in dispute for the last year to verify exactly what was paid and when. I matched payments against the version of the invoice the client actually received. In these cases where there were a dispute on what was paid compared to what should have been paid, I found that clients had paid the original amount, not the updated one.

Once the discrepancies were confirmed, I worked with each client to:

• Reissue corrected invoices or apply credit notes

• Update the records in Xero

• Make sure future communications were clear and accurate

By doing this, we recovered overdue revenue, fixed record-keeping errors, and rebuilt trust with several clients who were previously unsure where they stood.

Here’s how to avoid this kind of invoicing trouble in your business:

Never edit an invoice once it’s been sent. Even if the amount is wrong, avoid the temptation to "just fix it" in the original. Most systems—including your clients'—won’t recognise the change if the invoice number stays the same.

Communicate clearly with clients about any changes. If you’ve made an error, call or email the client before making changes. Let them know what happened and what to expect next. Being upfront avoids awkward back-and-forth later.

If you’ve under-invoiced:

- Decide whether it’s worth re-invoicing. If the amount is small, you might absorb the loss.
- If you do re-invoice, issue a new invoice with a note referencing the original.
- Don’t change the original invoice—keep it as is for recordkeeping.

If you’ve over-invoiced:

• Issue a credit note for the difference

• Apply it to the invoice and send a copy to the client

• Clearly reference the original invoice number so the client can update their system
  

Keep backup documents. Always keep a paper trail—especially if an invoice is corrected. That means saving copies of:

• Original and revised invoices

• Emails or messages confirming the change

• Remittance advice or payment confirmations

• Top Tip if you use Xero here – you can add a note on the invoice or credit in Xero with the information so if anyone else look at that in the future they can see why and what the change was for

This helps avoid disputes and supports your case if questions come up down the line.

This case was a strong reminder that even small habits—like editing an invoice without telling the client—can create ripple effects. When systems aren’t followed properly, businesses lose time, money, and trust. But with the right approach and a few simple practices, it’s easy to avoid.

If you’re dealing with a similar situation—or just want to double-check that your processes are solid—feel free to get in touch.

📧 elizna@stillwatersbookkeepinglimited.co.nz

 Let’s clean things up and make sure your books are working for you, not against you.

Blessings
Elizna