I believe this is a known issue. This KB article seems to indicate that this is only a GP 10.0 issue (in the last bullet point) – so perhaps this has been fixed in GP 2010? I, frankly, have seen so many other issues with the reconcile to GL functionality that I don’t use it much.

-Victoria

We have implemented this process as you’ve blogged it. It’s working great except for one little thing that we’re not sure how to resolve. When we run the routine to reconcile to GL our payables management (our account 2000) we are out of balance by the amount of the credit card transactions we’ve entered. Can you shed some light on this?

Thank you in advance!!

Ann

Maybe I am not seeing the whole picture, but this seems very complicated to me. Why not just set up Petty Cash as a checkbook instead? You don’t actually have to reconcile as with regular checkbooks, but having it set up this way lets you pay vendors from it. To get money back into it I would use a payables Return transaction.

-Victoria

Thank you for your kind words! I am not sure I entirely understand the example with the postage and petty cash in the context of credit cards…unless they have petty cash set up as a credit card?

In any case, there are 2 typical ways to enter a credit for credit cards:

1. Enter a credit memo directly for the credit card vendor. Typically I wait until the statement comes to apply the credit memo to invoices. That way I can just search on all the unapplied amounts for the credit card vendor and see them all easily. But it would not hurt anything to apply it earlier if you want to.
2. Enter a Return for the actual vendor and put the credit card information on the bottom right (some more on Return transactions here: http://victoriayudin.com/2008/12/30/payables-return-transactions-in-dynamics-gp/). This method is good if you want to keep track of the details for the actual vendor. This automatically creates a credit memo for the credit card vendor, which you can then decide when/how to apply, just as in the previous option.

Hope that helps.
-Victoria

“How can I enter a “credit” to a credit card? I sell postage stamps to employees occasionally. The cash is put in petty cash. The petty cash reimbursement request is lowered by this amount. We reimburse the petty cash fund with a credit card. In transaction entry, I can’t do a negative invoice, I can’t do the return because I don’t have an invoice to credit, and the credit memo goes to “on account” only.
Can I use the credit memo and then apply the “on account” amount when I pay the credit card? Or is there another way.” KS

Thanks, Sheila

Why not use a manual payment?

-Victoria

You can always see the original transaction in GP (unless you are not keeping history – gasp!), but there is no drillback to it…you would have to find it manually. If you need a quick and easy way to see all of them, you’re probably talking about a custom report. I am not aware of anything in GP out-of-the-box that will do it. If you actually want the drillback, that can probably be accomplished with a customization. But if you’re looking for a report, then all the drillback will do for you is give you a lot of manual work to collect this information, so I am not sure how helpful that is.

-Victoria

I have never used the approach you’re describing. I think overall it would work just fine…and whether this is better than using a vendor may very well depend on the specific usage of the credit card.

To your specific points – the only benefit I can kind of see is having the Bank Reconcile window available to use for matching up to the credit card statement. However, this may not be such a benefit if you are not always paying off 100% of each transaction and can also be accomplished by the apply process in Payables in a pretty similar manner. I have never seen a credit card vendor that needed a check stub enclosed with the payment, so I am not sure I buy that as a benefit…you can just not enclose the check stub.

Without actually trying this approach in a real life situation, some possible negatives that I can think of are:

• Not seeing your credit card vendor as part of your Payables Trial Balance and Historical Trial Balance.
• Not being able to apply credits to transactions and not being able to partially apply payments and credits.
• Not seeing a history of what transaction was paid with what payment. This may not be an issue if everything is paid right away…but if there are multiple credits and payments applied to a charge, this may be easier to see in Payables than in the Checkbook.
• Having a separate control account for each credit card vendor. This may actually be a benefit to some companies, again this may depend on the specific situation and number of credit cards.

-Victoria

What are your thoughts on simply using a GP Checkbook to represent a credit card account? The Checkbook’s “Cash Account” could be a credit card vendor specific liablity account. This liability account would be credited when paying the purchase vendor and debited when vouchering the credit card vendor. Using a Checkbook for the credit card allows for using GP’s Select Checks window, along with all other typical GP payment windows, and for using GP’s “Reconcile Bank Statements” window to reconcile the GP credit card payments with the credit card statement received from the credit card vendor. It also allows for creating only one voucher per credit card vendor statement thereby limiting check stub information, for the check paying the credit card vendor, to a single reference instead of it containing numerous internal invoice references, meaningless to the credit card vendor.

I just tested this and also looked up prior entries that I have made, in all cases a Credit Memo was created for the credit card vendor once the Return was posted. If you drill down to the Return, what is the On Account amount in the bottom right corner? What are the Types of the GL distributions for the Return?

-Victoria

We are entering a return on the original vendor and applying the credit card information in the bottom right. We see the Return on the original vendor (in history), but we are not seeing the return on the Credit Card vendor. Am I missing something?

Thanks, Kim

There is no way to do what you’re looking for with manual payments…maybe a customization would accomplish it, but nothing out-of-the box. I think you might be on to something with a Checkbook with a negative balance going to an AP account instead of Cash. I have never done this, so I cannot give specific recommendations and I would recommend lots of testing prior to putting it into production, but in thinking through it, I don’t see any major issues.

One possible pitfall: If you only have one AP control account, I would not recommend using it for this, because you may run into issues with the AP subledger reconciliation. I think this should be a separate AP General Ledger account. And if you have multiple credit cards that you’re going to do this for, then use multiple checkbooks and a unique GL account for each. Not necessarily a show stopper, but may impact other accounting practices.

If you do decide to go ahead with this, please post back to me know how it goes, I would be curious to find out how/if it worked for you. Thanks!

-Victoria