Need some help here. I have a CFO who is a real and will not provide me any requirements. I also have a CEO telling me to set up the system correctly without said requirements. It’s a real .
I know enough about accounting to be dangerous, but not enough to set up a GL correctly. I have a situation that I want to solve and set it up correct so the CFO can’t say I did something wrong, even if my intent was good.
We cut POs where we use a credit card and the buyer has to put the Credit Card company as the Supplier. I know there is a simple solution to this, but not sure how the GL accounts should be set up.
So, here is the my understanding of the credits and debits.
Invoice
Debit
Credit
AP Clearing
AP Payables
Payment
Debit
Credit
AP Payables
Cash Account OR Pending Cash
I want to set up a pending cash account and am not sure how to classify it. Is it a Liability? Is the balance credit? This is where I need the help.
As a note, I have never set up reconciliation in Epicor, and that might just be the answer. Any help is appreciated.
If you buy on a PO, you do the receipt. But you could just enter an invoice and use the Credit Card bank. That’s a matter of your process and controls, but technically, no PO required.
Huh. This is wild - I have never tried to think about this before in this way. We have bank accounts in Kinetic to represent the real-life ones, plus a couple for intercompany, and I’ve never had any reason to think about that setup; it seemed to mirror reality just fine.
But we do have other “banks” in that way that you speak of (“floor plan financing” for example) and it’s some Cirque-du-Soleil to work all that out I believe.
When we used Concur, they would pay the employees expenses for us. We set up a Concur bank to capture those payments and we followed the credit card procedure to capture expenses.
Honestly, I am trying to bow out of hijacking the thread, but you drew me back… we use Concur, though I don’t know if payment is part of that; I feel like that is still internal.
@Mark_Wonsil , so you are not using reconciliation? I would think that you would not need a Bank Transfer if you have reconciliation set up.
But that brings up a good thought. I can always set up the system the correct way and use Bank Transfer until we set up our accounts electronically. And then just change the settings to use reconciliation.
There are two reconciliations, correct? The cash bank and the credit card bank. There is one transaction that is common between them - the bank transfer. If you reconcile one and the transfer is missing, what is your offsetting transaction in Reconciliation? You’d need to put that transfer in so the other reconciliation works too. Right?
Also, I like to be intentional when moving money and the auditors kinda like that too.
@Mark_Wonsil & @JasonMcD , what is being used as the Transfer account in these situations? Is it a GL account that is only used for transfers, so it always has a zero balance?
We didn’t use a transfer account. Sounds like we’re talking to an accountant who only knows how to do this with journal entries.
The “Cash Account” for the Bank used by the Credit Card is the Liability account to track how much you owe to the credit card company. So, when you “pay” the invoice (i.e. record the charge), that’s the account that is debited.
We’re treating the Credit Card bank as a source of cash. Instead of being an asset account, it is a liability. The whole purchase cycle is the same whether we pay cash or pay with credit. The big difference is how we pay the credit card bill. Instead of using AP Processing, we record the payment with a Bank Funds Transfer. There is no check sent to the credit card company. We would pay via the portal, wire transfer, or some other electronic method. That reduces cash in the bank as well as the liability of the credit card on the balance sheet.
and will not provide me any requirements. I also have a CEO telling me to set up the system correctly without said requirements. It’s a real 
.
, that’s not helpful!
