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How to record debit card transaction in sage 50

Recording Debit card payment in sage made by the company employees to buy various things

Dear Sirs, 

Suppose , a company issues several debits cards to its employees who normally work on site to meet their day to day needs of expenses such as food, hotel , accommodation, any small parts or equipments while implementing the job on site. 

When they use their company debit cards , the money is realeased from the company current bank account. 

And the at the end of the month, the employees give all the cash receipts to the accounts . And the bookkeeper match those receipts with the original bank statement and record those transaciton in the system and calim the input VAT if applicable. It is normally recorded as the direct bank payment to the relevent nominal code (if no VAT invoice found)  and match the transaction with the original bank statemnet at the end of the month and reconcile the bank transactions. 

Do you think that the bookkeeper should record all the debit card transaction to the employee's separate expense A/c in sage system. That means , the bookkeeper can open a supplier account in the purchase ledger for each employee who hold the debit card of the company to make the payment. And all teh transactions was posed to his a/c as payment on account. And at the end of the month , the employee must submit an expense claim sheet showing the list of all the transaction used by the company debit card issued to him by the company and the debit card was under his name so that he is authorised to make payment using the debit card on behalf of the company to buy necessary things for the sake of company's interest. The employee is not allowed to take any  cash advance using the company's debit card from the cash machine for his own expendures. If he does , then he must submit expense claim sheet showin the advanced cash withdrawl made by himself from the company bank account using the debit card. 

Now, can anybody help me to decise which procedure shoud be the best procedure to record such transaction in the accounting system. 

Kind regards 

 

Samiur Rahman, FIAB

 

 

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By tom123
19th Jun 2017 13:10

Be careful not to over think these things - and create a hostage to fortune.

Try to base postings around information you know - ie if I see a debit card payment to Esso when posting the bank, I know what it is for. I don't know who spent it (unless your statement shows card numbers or something.)

I would be tempted to post all the bank transactions as bank transfers to an 'internal' bank account - thus enabling you to keep your main account reconciled.

When staff submit receipts, post cash book payments from this internal bank - and reconcile the payment and receipt in Sage.

Alternatively, think about corporate credit cards, where you get separate statements per user, and one payment per month.

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19th Jun 2017 14:29

If you want to record it like you've described I would set the employees up as bank accounts rather than as suppliers, less scope for getting in a muddle.

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19th Jun 2017 14:48

the bank should 'reference' the card to which its taking money from your main bank account. if it does not - it is generally available-request it via bank/card to be shown also on bankstmts/download reports etc.

When it does payments can be allocated to each card - /employee setup on the purchase ledger. IF the card has only one pyt per month - much easier, but numerous payments may not be an issue if you have data feeds etc.
By posting payments to AP ledger cardholders can be viewed by who is / is not taking the biscuit - or is / is not following expenses policy !!! Receipts allocated v payments - differences made good ....

Accounts should always accrue debit balances therefore in managemnt accounts- sums being known
Always review the ledger at time of leaving/termination to recover any monies due from final remuneration - contract permitting etc

oh - and this time of year having an AP account by card/emplyee - may be useful for p11d.....

one client recently had 25 cards out for staff travellers mainly and a couple of office managers - + one payment from the bank. Once the statement was downloaded the payment was allcotaed to each applicable card account - awaiitng their 'approved' expenses submissions. Once it gets unwieldy - use one of the on-line expense providers - and when staff have to pay + then be reimbursed - watch how things speed up!!!!! and how expenditure does drop [ personal coffees daily on the way in etc...]

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