Hey @sengming,
I was able to replicate what you’re seeing and dug into the other thread that Alan was investigating. What I see here matches with what was already reported by Alan.
What I found is that this is currently working as intended. When an order is marked as “PAID” but hasn’t actually processed payment (like orders created via REST API), cancelling with refund: true doesn’t trigger a refund because there’s no actual money to refund. This means the displayFinancialStatus remains “PAID” since technically no refund was processed.
While this status is accurate from a technical perspective, our team is considering ways to improve how this status is displayed to reduce merchant confusion in these scenarios.