antioch-alexandria wrote: ↑Fri Jan 29, 2021 8:39 pm
Looks like I have a large bag of worms...In the past when reconciling the credit card charges from the bank statement, I have been issuing a credit for the full amount to General Funds Accounting and a debit to each individual expense account (ie., Kitchen Ministry Equipment, Funeral Florals, etc.) What can be done at this point and what can I do to get this set up correctly for 2021? Thanks so much for your help!
Well, this is what I would do:
You can create a Credit Card Liability Account in your General Fund.
Then create a Transaction in Fund Accounting dated the date of the original check, DEBITING the CC Liability, and CREDITING the expense account(s) you originally debited when you cut that overpayment check. I'm going to assume that the total should reflect the amount that was paid.
This will setup the Liability account with a negative balance, this is actually correct, as you have a credit. This sets you up for January.
Now with this liability account setup, you should be entering each use of the credit card in the Accounts Payable module.
This involves using the
Maintain Manual Checks function of the AP module.
For the CREDIT entry, you do NOT use the checking account, but the CC Liability account. The expense account is debited as normal, you would then post AP as normal. FWIW ... for the manual check number I use
OFC-CC.
When the credit card bill comes in, you will then do a reconciliation as you would your bank statement, but select the account number of the liability account and use other information required from the CC Bill. You would then reconcile the purchases with the bill in the same manner you do with the bank statement and checks.
This method insures that every use of the credit card is properly expensed to the correct account as all receipts/invoices should be sent to the office when the card is used, and that funds are set aside in the month the expense was made. This is especially handy at the end of the year when often purchases made in December were paid using funds that were taken out of the next years budget. Using this method the funds are moved to liability and the Income & Expense report properly shows expenses for December, and previous year.
Where I'm current assisting in setting up PCPlus, they have three CC accounts, so I use UMB-CC, WM-CC, and STPL-CC as manual
check numbers. This also means I have three separate liability accounts, one for each card.