MV Software Knowledge Bas…  Modules»Accounts Payable»Task 20 - Check Account
  
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Last modified on 12/16/2015 5:18 PM by User.

Tags:
Check, Account, master

Task 20 - Check Account

See document “Transition to Computer Using a Single Account ” to start using this task.  And "Reconcile the Bank Statement" for instructions on how to reconcile the bank statement. This document explains the fields, terms, and how information is automatically and manually entered.  Another document that might be helpful is “Checkbook Out of Balance””.

 

This task may be used to reconcile the checkbook.

 

If transactions in Voucher Entry & Editing (Task 1) have any check numbers, the check information is posted to this task.

 

Voucher Payment Preparation (Task 25) posts the check information to this task.

 

Voided checks need to be manually entered into the Checking Account (Enter void check# with a $0.00 amount.)

 

If the payroll module is used and the payroll comes from the same checking account as the A/P, go to System Management Functions (Task 32 in the Accounts Payable module), Post Payroll to Check File (Sub-task 6). This should be done after payroll is finished.  If the payroll module is not being used but the checks come out of the same checking account, each payroll check will have to be manually entered into the checking account file.

 

Deposits from the A/R module may be automatically posted to this file.  To do this, go to:

  • Accounts Receivable (Module 2)
    • System Management Functions (Task 32)
      • Modify Parameter Files (Sub-task 22)
        • A/R – General (Option 1)
          • Look for the parameters:  
            • POST’TO’AP=.

              • If this parameter is set to Y, when Task 2 in AR (Cash/Receipts Entry & Editing) is POSTED, it will automatically post a deposit to Task 20 in AP  (Check Account).  The deposits in the A/P Task 20 (Check Account) need to match what is on the Bank Statement.

            • POST’INCLUDE’OTHER=.
              • ​The parameter POST’TO’AP must be Y for this parameter to be utilized.  If you want to include the “Other” amount from the cash posting when it posts the deposit into A/P Task #20 Check Account, answer Y to this parameter.  Divisional transfers use the “other” amount on the cash posting.
            • POST’INCLUDE’CCD=.
              • The parameter POST’TO’AP must be Y for this parameter to be utilized.  If you want to include the “Credit Card” amount from the cash posting when it posts the deposit into A/P Task #20 Check Account, answer Y to this parameter.  The bank statement will have separate deposits for the VISA/MasterCard, American Express, and Discover.  If your credit cards are deposited into the same checking account and this parameter is set to N, then you will have to go directly into A/P Task #20 Check Account and enter the Visa/Master card, American Express, and Discover deposits manually.

 

It is recommended that this be done daily.  Each day there could be one deposit with checks and cash from counter customers, another from Visa/Master Card, another from American Express, another from Discover, and yet another deposit from the checks that come in the mail.  There could be 5 separate deposits each day that have to be entered into the AP check account.

  • Electronic Fund Transfer – EFT’s should be entered into Task 1 of AP  (Voucher Entry & Editing).  While vouchering an EFT, when the cursor is at field #7 (Check #) enter the type: ‘8’.  It is specially designed in the software so that it knows ‘check #8’ is an EFT.   Use this for any amount that is going to come out of the checking account but no check will actually be written.
  • Manual entries – When reconciling the bank statement there might be charges or additions on it, i.e. bank charges, deposit book charges, check order charges, bad check charges etc…  These need to be manually entered into the check account using Trx #1 through 5 & 8.
  • A general ledger journal entry will need to be made for any manual entries that did not go through A/R, P/R or that weren’t vouchered.
  • This file is the source from which System Management Functions (Task 32), Display Current Checking Status (Sub-task 5), pulls its information.

 

 

ENTER NEW CHECK RECORD (SUB-TASK 1 in TASK 20 of AP)

 

Below are the fields involved in adding a New Check Record (found on the left side of the screen):

  • 01. Trx#:       The check # is the TRX # for all checks. Note: for other transactions, not involving entering a New Check Record:  instead of entering the check number in the Trx# field, a “Trx Type” could be entered using the “Optional Trx # Types” listed on the right side of the screen. See below for explanation of the various Optional Transaction Types.
  • 02. Trx Date: Enter in the date that the Trx occurred. Never enter anything with a previous months date.
  • 03. Appl Area:This is a 3-character notation. It is user-defined, can be letters or numbers. Suggestions are:
    • A/R for regular deposits that went through Accounts Receivable, (checks that came in the mail for accounts receivable).
    • DEP for deposits that are for counter orders, checks and cash through Order Processing, Invoiced Order Holding File (Task 2), then A/R Cash Entry & Editing (Task 1 in AR).       
    • VSA for VISA deposits, AMX for American express deposits.
    • The A/P checks automatically have A/P.
    • The P/R checks automatically have P/R.

  • ​04. Written to:

    • This is the vendor # for A/P checks.

    • This is the employee # for P/R checks.

    • Or this field can remain blank.

  • ​05. Clear date: This should be left blank until it’s time to reconcile to the bank statement.  Then it should be the last day of the month being reconciled.

  • 06. Amount:     Type in the amount of the TRX, no decimals.

  • 07. Batch #:    Press the Enter key. The information comes from Voucher Entry & Editing or Voucher payment preparation.

  • 08. Division #: This is the division # that the TRX is for.  There can be separate checking accounts for each division. 

 

Below are the optional checking account TRX # types (seen on the right side of the screen):

  • 0 =     Deposit: When manually entering a deposit, press the Enter key at Trx #.
  • 1 =     C/C Charge: VISA/MC fee that bank charges (subtracted from the checking account)
  • 2 =     Misc. Charge: Service charges, Deposit ticket charges, etc. (subtracted)
  • 3 =     Bad Ck/CC NSF: Check or Credit Card amount that "bounced". (subtracted)
  • 4 =     Coll/Ck/CC NSF: Check or Credit Card collected back (added to the checking account)
  • 5 =     Lost ck.        Stopped payment (added)
  • 6 =     Your checkbook balance: This MUST always be dated the first day of the month.  This is changed only when you have reconciled to the bank statement balance.  This is NOT the bank statement balance.  Using the bank statement balance and adding in any outstanding deposits, subtracting out any outstanding checks is “Your checkbook balance”.  Please see “TRANSITION TO COMPUTER CHECKING ACCOUNT” and “RECONCILING THE BANK STATEMENT”.    It is recommended that the amount of the checking account in General Ledger match this. 
  • 7 =     Bank’s checkbook balance: This MUST always be dated the first day of the month.  This is changed only when you have reconciled to the bank statement balance.  This IS the bank statement balance.  Please see “TRANSITION TO COMPUTER CHECKING ACCOUNT’ and “RECONCILING THE BANK STATEMENT”.
  • 8 =     Electronic Funds Transfer: Use this for the check # when vouchering an electronic funds transfer in Task 1 of AP (Voucher Entry & Editing).  For example a car payment that automatically comes out of the checking account.  Or payroll taxes that are transferred over the phone. (subtracted)   

 

CHANGE EXISTING CHECKS RECORD (SUB-TASK 2 in TASK 20 of AP)

Note: Transactions with a previous month’s date should never be changed.  When doing this it is like saying:   the ‘Trx type 6’ (Your Checkbook Balance) is now different.  You will be “Out Of Balance”.

 

When first going into sub-task 2 (Change Existing Check Records), the system will prompt:

  • Are you putting in clearance dates? (Y/N):
    • If a VISA deposit was just entered for the wrong amount and needs to be corrected, answer N to this question. 
    • The only time a Y would be answered to this question is when the bank statement reconciliation is being done.  Please see the document titled “Reconciling the Bank Statement”.
    • When a Y is answered, the system will then prompt -

  • Please enter division #: Type in a division # if reconciling the bank statement for only one division.

  • Please enter clearance date: Use the last day of the month that is being reconciled.

 

 

DELETE EXISTING CHECKS RECORD (SUB-TASK 3 in TASK20 of AP)

This is for deleting one transaction at a time.  NEVER delete anything from a previous month.  When doing this it is like saying:   the ‘Trx type 6’ (Your Checkbook Balance) is now different.   You will be “Out Of Balance”.

 

 

 

PRINT SELECTED CHECK RECORDS (SUB-TASK 4 in TASK 20 of AP)

When printing this report, the "starting date" should always be the same date as the Trx # type 6 and 7.

Below are the names of the TERMS on the report (note: not all terms may appear on the report.  It depends on the information available in the checking account.)

 

  • UNCLEARED TRX, NOT IN TOTALS: This is at the end of each data line dated for a previous month. This IS NOT included in the "PREV BANK BAL:" total. This IS included in the "PREV CHECKBOOK BAL:" total.
  • CHECKS PRINTED: Number of checks on the report.
  • DEPOSITS MADE: Number of deposits on the report.
  • PAID OUT: Total of the checks on the report, which are subtracted from the totals.
  • OTHER PAID OUTS: Total of the other transactions types, which are subtracted from the totals, i.e. 1=CC charge from bank, 2=Misc.charge from bank,  3=Bad check/CC and 8=Electronic Funds Transfer.
  • DEPOSITED: Total of the deposits on the report, which are added to the totals.
  • OTHER DEPOSITS: Total of the other transactions types, which are added to the totals, i.e. 4=Collected bad/redeposit, 5=Lost check/redeposit.
  • PREV CHECKBOOK BAL: This is the $ amount in the computer for transaction type #6=Your checkbook balance. It is recommended that the amount of the checking account in General Ledger match this.  The date that the computer has for this transaction appears on the report. This date should be the same as the #7 Bank's checkbook balance’s date.  It should also be the first date of the month.  The amount and date on this should be changed after reconciling to the bank statement balance.
  • CHECKBOOK BAL: This is the sum of everything on the report, cleared or not, i.e. PAID OUT: OTHER PAID OUTS: DEPOSITED: OTHER DEPOSITS: and the PREV CHECKBOOK BAL.  (If everything on the report were to clear the bank, this would be your balance.)
  • CHECKS CLEARED: Number of transactions that are subtracted from the "PREV BANK BAL:" with a clearance date.  This should be zero except when reconciling to the bank statement.
  • DEP CLEARED: Number of transactions that are added to the "PREV BANK BAL:" with a clearance date.  This should be zero except when reconciling to the bank statement.
  • ACCOUNT REDUCTION: Sum of transactions that are subtracted from the "PREV BANK BAL:" with a clearance date.  This should be zero except when reconciling to the bank statement.
  • ADDED TO ACCOUNT: Sum of transactions that are added to the "PREV BANK BAL:" with a clearance date.  This should be zero except when reconciling to the bank statement.
  • BANK BAL CHANGE: Sum of the "ACCOUNT REDUCTION:" and the "ADDED TO ACCOUNT:” This should be zero except when reconciling to the bank statement.
  • PREV BANK BAL: Is the TRX Type #7 (Bank's Checkbook Balance). This should be the same as the last bank statement ending balance. The date the computer has for this transaction prints on the report. This should be the same date as theTRX #6 (Your Checkbook balance) is dated. This should also be the first date of the month.  The date and amount on this should be changed every month after you reconcile to the bank statement balance.  Please see the document “RECONCILING TO THE BANK STATEMENT BALANCE”.
  • NEW BANK BALANCE: This may be the same as the Trx type #7 (Bank Checkbook Balance).  The only time this changes is when clearance dates are entered at the time of reconciling to the bank statement.  This total is derived at by Taking the “PREV BANK BAL:” and subtracting the "ACCOUNT REDUCTION: then adding the "ADDED TO ACCOUNT". When reconciling the bank statement this MUST balance to the bank statement ending balance.  Please see the document “RECONCILING TO THE BANK STATEMENT BALANCE”.
  • UNCLEARED DEPOSITS: Is the sum of all the transactions that are added to the account (not just deposits) without a clearance date.
  • UNCLEARED CHECKS: Is the sum of all the transactions that are subtracted from the account (not just checks) without a clearance date.
  • RECONCILIATION AMT: This total is derived by taking the "NEW BANK BALANCE:" amount and adding "UNCLEARED DEPOSITS:" amount, then subtracting "UNCLEARED CHECKS:" amount.
  • OUT OF BALANCE: This is the difference between the "RECONCILIATION AMT:" and the "CHECKBOOK BAL:" This should always be zero. 
  • If there is an amount that is "OUT OF BALANCE:” it means data from a previous month has been altered.  NEVER change data from a previous month, i.e. add, change, or delete. When this is done, it means that the amount that was entered into the computer for the transaction type #6 - Checkbook balance is no longer correct.

See document titled: “CHECKBOOK OUT OF BALANCE” for help in fixing an out-of-balance condition.

 

 

ERASE SELECTED CHECKS RECORDS (SUB-TASK 5 in TASK20 of AP)

This is to erase a group of transactions.  The only time this is done is AFTER balancing and reconciling to the bank statement.  See document titled: “RECONCILING TO THE BANK STATEMENT”.