Detailing Credit Card Transactions in Abila MIP
An organization typically pays many vendors on a credit card statement. However, since the AP invoice and AP check are associated with the credit card provider, it is difficult to locate charges to a vendor and accumulate them with other direct purchases from the vendor.
By using a two-step process in Abila MIP to first record the individual expenses as a cash disbursement from a pseudo-cash account and then record an AP invoice again this same account, you will be able to trace the credit card charges back to the original vendor.
The first step is to set up a general ledger code which acts as a credit card clearing account. To provide reporting capabilities this account must be set up as a Cash (CSH) type account (this will make sense later).
To record the credit card receipts as expenses for your vendors you will need to use a manual Cash Disbursement (Transactions>Enter Cash Disbursements) session. This transaction will act as pseudo AP invoice by associating the vendor with the expense. In the cash disbursement transaction simply debit the appropriateexpense and select the appropriate Vendor for Payee ID and credit the new Cash type Credit Card clearing account. You will create a cash disbursement to the specific vendor for each of the charges on the credit card bill.
At the end of the month or when you receive your credit card bill, you will record the total amount of the invoice through the normal AP invoices entry process, except you will debit the Cash type Credit Card Clearing account instead of an expense account.
You can then pay your credit card company with a check through the normal AP process and you will be able to track your expenses by vendor using the Vendor Activity Report.
Please note you will also be able to use this process if you import your credit card transactions. Change the transaction type for the import file to CD for cash disbursements and make sure your offset or transaction credit account is set to the Credit Card Clearing Account.
For help with setting up this process at your organization, please contact Net at Work at 1.800.719.3307