Loan from Director, how to handle bank transfer

Question

Hello all,   We are very new to Myob software and have been following guides posted by others on these forums and they have been very helpful - thankyou for you contributions to others.

I am having a little trouble following the flow for the following scenario and hoping for a shove in the right direction.

We are small start up buisness, and have had to purchase alot of start up materials using personal funds.  I have set up a Loan from Director account and can create Bills for the expenses.  I then set the payment from the loan from director account to the bills.

When our cashflow allows from incoming sales, I can perform a transfer from our business account, to our personal account.   I record this in myob as a transfer (from business account to loan from director).  I then perform the physical transfer in the real bank account (from buisness to personal). For fee reasons, we consolidate multiple transactions under the one bank transfer.

Example:

I have 4 different bills, all $25.  I perform 4 seperate payments for the 4 bills in Myob.  In the real bank account, I perform a single transfer to personal for $100.

When Myob reads in the transaction from the bank feed, it picks up this single bank transfer, but I am unsure how to handle it.  It doesn't seem to match to anything, and in the transfer area, I can't seem to split it.  I can allocate it and split it, but it seems to double up the payments in teh debits and credits transactions page.

I know I am doing something silly, or missing a vital process step in myob, so appreciate any guideance.  Thankyou

Franscesca

LRBooks61 · Answer

I think the problem is that you are doing the transfer from the account in myob.

so you allocate that bank payment again when you get the bank feed

That is if I am understanding this correctly

you can either set these all up as electronic payments and prepare an aba file to upload to the bank - myob would then prepare the transaction in the myob bank account to match with your bank feed

if you want to do the one transaction together in the bank but manually allocate in bank feeds you need to really do the same process (allocate payments to come from your electronic clearing account or undeposited funds bank account  ) then you can select the payments that match the bank transaction in bank feeds

hope that is clearer

i cannot see your screenshots, sorry

Lisa

WattleTreeRidge · Answer

Thankyou for taking the time to repsond Lisa,

I

@LRBooks61 wrote:Hi

Have you set up the Loan account from Directors as a bank account ?

If I understand you correctly :

You have purchased items for the business from personal funds and are wanting to repay the business owners as cash flow allows? is this correct?

Not as a bank account, but as a liability - loan from Director

And yes your summary is correct.  Paying a bill from personal funds, and then reimbursing director when cash flow allows.

I have set up a bill from supplier and payed the supplier using personal funds from the director,  I have recorded this in the 'record payment' against the bill, using the loan from director account.

When funds allow, I then perform a transfer in myob, using the transfer money tool

At the same time as the myob transfer, i do the real transfer in the real bank account,  however the nuance is I might bundle multiple real transfers in order to reduce real transaction fees in the real bank account.

I beleive this is as per what you describe.

This then shows up in the debit and credits as balancing for the loan from directors

when the bank feeds update, the real transfer shows up....this is where I am confused i think.  As i don't know what to associate it too or how to split it.   I code everything in the references or descriptions with the payment # and tranfer #'s in the hope to distribute correctly.

Don't set up a bill for the payment of the directors loan , I think that is where you are going wrong. It is in itself self expanatory. Just allocate the repayment against the directors loan bank account

Hope this helps

Lisa

I am not setting up a bill for the directors loan reimbursment (well, not that i know off).  If i split the transfer across the appropriate transfers from the bank feed using allocate, it seems to put the debit and credit out of balance.

I hope this helps to clarify the situation

I know I am missing a step here, but having a brain fade moment with this.

LRBooks61 · Answer

Hi

Have you set up the Loan account from Directors as a bank account ?

If I understand you correctly :

You have purchased items for the business from personal funds and are wanting to repay the business owners as cash flow allows? is this correct?

Essentially you should have entered the bills and paid them from a bank account ( loan account from Directors)

So in this scenario the bills have been entered and should have been paid.

When you can afford to shift some money you should just transfer the money from the business bank to the loan to directors bank account.

(This is where I think the bills you are paying are actually bills you set up to repay the loan from Directors not bills for the business)????

So if you are paying  4 billls (supplier bills in this example) and the repayment to the director (in  the one transaction of $200 when it comes to allocate from your bank feed

Allocate the transfer of the loan repayment straight to the bank account rather than a transfer

eg busness bank account 1-1000

director loan bank account 1-1005

Bank feed $200

allocate payments for bills ( they should only be supplier bills)

allocate to accout 1-1005 $100

Don't set up a bill for the payment of the directors loan , I think that is where you are going wrong. It is in itself self expanatory. Just allocate the repayment against the directors loan bank account

Hope this helps

Lisa