diff --git a/src/libs/actions/IOU/index.ts b/src/libs/actions/IOU/index.ts
index 2d6b7272ce79..fc5050c5e350 100644
--- a/src/libs/actions/IOU/index.ts
+++ b/src/libs/actions/IOU/index.ts
@@ -4426,7 +4426,7 @@ function calculateDiffAmount(
     if (!iouReport) {
         return 0;
     }
-    const isExpenseReportLocal = isExpenseReport(iouReport);
+    const isExpenseReportLocal = isExpenseReport(iouReport) || isInvoiceReportReportUtils(iouReport);
     const updatedCurrency = getCurrency(updatedTransaction);
     const currentCurrency = getCurrency(transaction);
 
@@ -4541,7 +4541,7 @@ function getUpdateMoneyRequestParams(params: GetUpdateMoneyRequestParamsType): U
     const transaction = allTransactions?.[`${ONYXKEYS.COLLECTION.TRANSACTION}${transactionID}`];
 
     const isTransactionOnHold = isOnHold(transaction);
-    const isFromExpenseReport = isExpenseReport(iouReport);
+    const isFromExpenseReport = isExpenseReport(iouReport) || isInvoiceReportReportUtils(iouReport);
     const updatedTransaction: OnyxEntry<OnyxTypes.Transaction> = transaction
         ? getUpdatedTransaction({
               transaction,
diff --git a/tests/actions/IOUTest.ts b/tests/actions/IOUTest.ts
index e022574ef85f..b3e6bca97e65 100644
--- a/tests/actions/IOUTest.ts
+++ b/tests/actions/IOUTest.ts
@@ -10646,6 +10646,72 @@ describe('actions/IOU', () => {
 
             expect(calculateDiffAmount(fakeReport, updatedTransaction, fakeTransaction)).toBeNull();
         });
+
+        it('should return 0 when the currency and amount of the transactions are the same for an invoice report', () => {
+            const fakeReport: Report = {
+                ...createRandomReport(1, undefined),
+                type: CONST.REPORT.TYPE.INVOICE,
+                policyID: '1',
+                stateNum: CONST.REPORT.STATE_NUM.APPROVED,
+                statusNum: CONST.REPORT.STATUS_NUM.APPROVED,
+                managerID: RORY_ACCOUNT_ID,
+            };
+            const fakeTransaction: Transaction = {
+                ...createRandomTransaction(1),
+                reportID: fakeReport.reportID,
+                amount: 100,
+                currency: 'USD',
+            };
+
+            expect(calculateDiffAmount(fakeReport, fakeTransaction, fakeTransaction)).toBe(0);
+        });
+
+        it('should return the correct diff for an invoice report (same sign convention as expense reports)', () => {
+            const fakeReport: Report = {
+                ...createRandomReport(1, undefined),
+                type: CONST.REPORT.TYPE.INVOICE,
+                policyID: '1',
+                stateNum: CONST.REPORT.STATE_NUM.APPROVED,
+                statusNum: CONST.REPORT.STATUS_NUM.APPROVED,
+                managerID: RORY_ACCOUNT_ID,
+                currency: 'USD',
+            };
+            const fakeTransaction: Transaction = {
+                ...createRandomTransaction(1),
+                amount: 100,
+                currency: 'USD',
+            };
+            const updatedTransaction = {
+                ...fakeTransaction,
+                amount: 200,
+                currency: 'USD',
+            };
+
+            expect(calculateDiffAmount(fakeReport, updatedTransaction, fakeTransaction)).toBe(-100);
+        });
+
+        it('should return null when the currency of the updated and current transactions differ for an invoice report', () => {
+            const fakeReport: Report = {
+                ...createRandomReport(1, undefined),
+                type: CONST.REPORT.TYPE.INVOICE,
+                policyID: '1',
+                stateNum: CONST.REPORT.STATE_NUM.APPROVED,
+                statusNum: CONST.REPORT.STATUS_NUM.APPROVED,
+                managerID: RORY_ACCOUNT_ID,
+            };
+            const fakeTransaction: Transaction = {
+                ...createRandomTransaction(1),
+                amount: 100,
+                currency: 'USD',
+            };
+            const updatedTransaction = {
+                ...fakeTransaction,
+                amount: 200,
+                currency: 'EUR',
+            };
+
+            expect(calculateDiffAmount(fakeReport, updatedTransaction, fakeTransaction)).toBeNull();
+        });
     });
 
     describe('initMoneyRequest', () => {
diff --git a/tests/unit/TransactionUtilsTest.ts b/tests/unit/TransactionUtilsTest.ts
index 179593ce91b5..d50857a61e00 100644
--- a/tests/unit/TransactionUtilsTest.ts
+++ b/tests/unit/TransactionUtilsTest.ts
@@ -390,6 +390,32 @@ describe('TransactionUtils', () => {
                 merchant: CONST.RED_BRICK_ROAD_PENDING_ACTION.UPDATE,
             });
         });
+
+        it('should negate modifiedAmount when isFromExpenseReport is true', () => {
+            const transaction = generateTransaction();
+            const newAmount = 500;
+
+            const updatedTransaction = TransactionUtils.getUpdatedTransaction({
+                transaction,
+                isFromExpenseReport: true,
+                transactionChanges: {amount: newAmount},
+            });
+
+            expect(updatedTransaction.modifiedAmount).toBe(-newAmount);
+        });
+
+        it('should not negate modifiedAmount when isFromExpenseReport is false', () => {
+            const transaction = generateTransaction();
+            const newAmount = 500;
+
+            const updatedTransaction = TransactionUtils.getUpdatedTransaction({
+                transaction,
+                isFromExpenseReport: false,
+                transactionChanges: {amount: newAmount},
+            });
+
+            expect(updatedTransaction.modifiedAmount).toBe(newAmount);
+        });
     });
 
     describe('getTransactionType', () => {