Reference: Settlement Run Items and Payments

You can add unpaid open items and pending payments to a settlement run. The payment categories include:

Option	Description
Customer Invoices	The settlement process creates and settles these payments by charging the customer credit card or direct debit account. The settlement process groups all eligible invoices and adjustments for the same company, payee, and payment type into a single payment. When you select the Customer Invoices check box in the Separate Payments section on the Overview Payment Details profile group of the customer profile, the settlement process creates separate payments for invoices, except when you process: A credit card invoice and 1 or more invoice credit adjustments. A direct debit invoice and 1 or more invoice credit adjustments that have a printed direct debit mandate pre-notification. Invoices don't include payments the customer initiates, such as calling in to pay with a new credit card. You can: Enter discount amounts by changing the Discount Given . The payment terms of the invoice or adjustment determine the initial discount. Make partial payments by changing the Amount to Pay . Collect a net amount for related invoices and adjustments. Example: The customer has an invoice for 100 USD for 3 items. The customer also has a 20 USD adjustment for a returned item. When you include both the invoice and the invoice adjustment in the same settlement run, you can collect the net 80 USD from the customer.
Customer Payments	Select payments that the customer makes outside of a regularly scheduled billing cycle and that you manually record. When a customer makes an unscheduled payment by check, you don't need to settle the payment. Instead, select the Create Deposit check box on the Record Customer Payment task to record the payment deposited into your bank.
Expense Reports	The settlement process combines expense reports for the same person into a single payment.
Intercompany Items	The settlement process creates and settles these payments. The process combines intercompany items for the same company into a single payment. Your payment must be a positive amount because Workday doesn't generate negative payments.
Pay Group Exceptions	Includes all off-cycle payments and any on-cycle payments that you complete individually. The Off-Cycle Payroll Payment Count field displays how many pay group exceptions you have in Workday, off-cycle and on-cycle.
Pay Groups	Payments from standard, on-cycle runs that you batch process, such as monthly payroll. Workday displays only summarized information about the group of payments. To see individual payments, use payroll tasks and reports.
Supplier Invoices	You can: Enter discount amounts by changing the Discount Given . The payment terms of the invoice or adjustment determine the initial discount. Make partial payments by changing the Amount to Pay . Collect a net amount for related invoices and adjustments. Example: You have an invoice for 1000 USD that consists of 10 items priced at 100 USD each. You also have a 200 USD adjustment because you returned 2 items. When you include both the invoice and the invoice adjustment in the same settlement run, you can pay the net 800 USD to the supplier. The settlement process creates and settles these payments. The process combines all invoices for a supplier into a single payment. If you select the Always Separate Payments check box when you define the supplier, the process settles the invoices for that supplier as separate payments. You can select the Separate Payment check box on individual invoices to settle ad hoc separate payments.

Steps: Use Settlement