diff --git a/addons/account/models/account_move.py b/addons/account/models/account_move.py
index 082d5656edc..1d86c79c2f0 100644
--- a/addons/account/models/account_move.py
+++ b/addons/account/models/account_move.py
@@ -3401,7 +3401,6 @@ class AccountMove(models.Model):
         # Reconcile moves together to cancel the previous one.
         if cancel:
             reverse_moves.with_context(move_reverse_cancel=cancel)._post(soft=False)
-            reverse_moves = self._reconcile_reversed_moves(reverse_moves, cancel)
 
         return reverse_moves
 
@@ -3533,7 +3532,7 @@ class AccountMove(models.Model):
             'posted_before': True,
         })
 
-        draft_reverse_moves.reversed_entry_id._reconcile_reversed_moves(draft_reverse_moves, False)
+        draft_reverse_moves.reversed_entry_id._reconcile_reversed_moves(draft_reverse_moves, self._context.get('move_reverse_cancel', False))
 
         for invoice in to_post:
             invoice.message_subscribe([
diff --git a/addons/account/models/account_move_line.py b/addons/account/models/account_move_line.py
index a8d704c8be2..b1b467c711a 100644
--- a/addons/account/models/account_move_line.py
+++ b/addons/account/models/account_move_line.py
@@ -2332,8 +2332,10 @@ class AccountMoveLine(models.Model):
                 )
 
                 # Exchange difference for cash basis entries.
+                # If we are fully reversing the entry, no need to fix anything since the journal entry
+                # is exactly the mirror of the source journal entry.
                 caba_lines_to_reconcile = None
-                if is_cash_basis_needed(involved_amls.account_id):
+                if is_cash_basis_needed(involved_amls.account_id) and not self._context.get('move_reverse_cancel'):
                     caba_lines_to_reconcile = involved_amls._add_exchange_difference_cash_basis_vals(exchange_diff_values)
 
                 # Prepare the exchange difference.
@@ -2691,7 +2693,6 @@ class AccountMoveLine(models.Model):
                 caba_reconcile_key = (transition_line.move_id, transition_line.account_id, transition_line.tax_repartition_line_id)
                 caba_lines_to_reconcile[caba_reconcile_key] |= transition_line
 
-
             # ==========================================================================
             # Generate the exchange difference journal items:
             # - to reset the balance of all transfer account to zero.
diff --git a/addons/account/tests/test_account_move_reconcile.py b/addons/account/tests/test_account_move_reconcile.py
index bf70a2a2f55..217ddf19a29 100644
--- a/addons/account/tests/test_account_move_reconcile.py
+++ b/addons/account/tests/test_account_move_reconcile.py
@@ -4564,3 +4564,41 @@ class TestAccountMoveReconcile(AccountTestInvoicingCommon):
             }
         ]
         self.assertRecordValues(caba_move.line_ids, expected_values)
+
+    def test_cash_basis_full_refund(self):
+        """ Ensure the caba entry and the exchange difference journal entry for caba are not created in case of full
+        refund.
+        """
+        self.env.company.tax_exigibility = True
+
+        tax = self.env['account.tax'].create({
+            'name': 'cash basis 20%',
+            'type_tax_use': 'purchase',
+            'amount': 20,
+            'tax_exigibility': 'on_payment',
+            'cash_basis_transition_account_id': self.cash_basis_transfer_account.id,
+        })
+
+        invoice = self.init_invoice('out_invoice', post=True, amounts=[1000.0], taxes=tax)
+
+        # Reverse completely the invoice.
+        credit_note_wizard = self.env['account.move.reversal']\
+            .with_context({'active_ids': invoice.ids, 'active_model': 'account.move'})\
+            .create({
+                'reason': 'test_cash_basis_full_refund',
+                'journal_id': invoice.journal_id.id,
+            })
+        action_values = credit_note_wizard.modify_moves()
+        self.assertRecordValues(invoice, [{'payment_state': 'reversed'}])
+
+        # Check no CABA move has been created.
+        cash_basis_moves = self.env['account.move']\
+            .search([('tax_cash_basis_origin_move_id', 'in', (invoice.id, action_values['res_id']))])
+        self.assertFalse(cash_basis_moves)
+
+        # No exchange journal entry created for CABA.
+        caba_transfer_amls = self.env['account.move.line'].search([
+            ('account_id', '=', self.cash_basis_transfer_account.id),
+            ('move_id.move_type', '=', 'entry'),
+        ])
+        self.assertFalse(caba_transfer_amls.move_id)