Code 150: Softgoods Defective Allowance

Overview

Code 150 deductions are discounts applied for defective softgoods merchandise, such as apparel products. A Code 150 occurs when a defective allowance listed in the supplier agreement is not included on the invoice.

Common Root Causes

One common cause of invalid Code 150 deductions occurs when the supplier agreement requires the allowance to be applied off-invoice, but the EDI provider applies the allowance at the line-item level. In this situation, the correct dollar amount has already been withheld, but Walmart may interpret the allowance as missing.

• Purchase orders containing incorrect allowance or pricing information.
• Required allowances missing from invoices.
• Shipping against inaccurate purchase orders without corrections.
• Incorrect EDI allowance codes being used.
• Allowance calculations based on net invoice amounts instead of gross amounts.

How to Prevent Valid Code 150 Deductions

• Verify all purchase orders are accurate before shipping.
• Ensure invoices match purchase order details exactly.
• Confirm with your EDI provider that supplier agreement allowances appear correctly on EDI 810 invoices.
• Verify allowances listed in supplier agreements appear on both purchase orders and invoices.
• Maintain documentation for any special deals and ensure buyer approval.

Can It Be Disputed?

Agreed-upon allowances cannot typically be disputed. However, if the supplier can prove that the allowance was already applied on the invoice, the deduction may be disputed.

How to Dispute Invalid Code 150 Deductions

Allowance disputes can technically be submitted through the Accounts Payable Dispute Portal (APDP). However, Walmart has indicated that allowance deduction codes 50–59, 150, and 151 are unlikely to be approved through APDP.

The alternative approach is to work directly with the buyer. Disputes should include supporting documentation and require buyer approval for reimbursement.

Supporting Documentation

• Supplier agreement showing the negotiated defective allowance.
• Purchase order showing the expected allowance.
• EDI 810 invoice demonstrating that the allowance was applied.
• Documentation for any special pricing or allowance agreements approved by the buyer.

Conclusion

Code 150 deductions usually result from differences between supplier agreements, purchase orders, and invoice allowance handling. Reviewing EDI mappings, validating allowance calculations, and maintaining clear documentation can help prevent invalid deductions and support successful disputes.