The paypal reversal is recorded within the Sphere contact record under Interactions > Activities, and Blackbaud issues the refund back to the PayPal account. Note that Paypal transactions take longer to reverse than regular transactions and can take up to 10 business days or more to post back to the supporters account.

This can be seen by doing the following:
1. Go to Contacts > Individuals
2. Search for the supporter
3. Hover over Manage and click Manage Contact
4. Click the Interactions tab
5. Click the Activities sub-tab