Payroll reversal and bank feeds in AR

[phil404]

Hi

I have had to reverse 2 pays as the employees are able to claim the covid19 disaster payment and i had already paid them out of annual leave so they had some money.

I have followed the instruction on reversing the pays and sending the updated reports to the ATO. In the instructions it say the returned payments are sent to the Linked account for cash payments. This account show nothing just $0.00.

I went to Bank Feeds and found 4 entries on the Bank Statement side and the Closing Balance at the bank to be lower then the Calaulated Balance by the amount of the 4 entries. There is nothing showing under the Your Transactions side. These amount would have already been matched and approved before doing the reversal.

If i click on the find button i can find the original transaction is still there, I guess because it was done as a reversal.

So question ...

1.   Do i rematch the Bank Statement back to the original transaction (I'm assuming it has become un-matched with the reversal).

2.   How do i match up the Bank Statement Deposits when the money comes back into the account.

3.   Why is there no $ showing in the Linked cash payment account.

The instruction on correcting and overpayment in payroll were very good for the payroll section however there does't seem to be anythink to complete the banking side.

Thanks for anyone help.

Cheers Phil

[Tracey_H]

Hi @phil404 

Thanks for your post. When you reverse a payroll transaction you'll get the message "This pay is a reversal. If you record this pay, the payment method used will be cash". This means that the payment method is changed to cash, not the Pay from Accounts, so the reversed transactions will appear in the same account as the original transaction.

Original pay transaction with Pay from Account as Electronic clearing account and Payment Method as Electronic:

Reversal with Pay from account as Electronic clearing account and Payment Method as Cash:

Reversing a transaction won't unreconcile the original transaction as it hasn't been changed in any way, you've just recorded a completely new opposite version of the transaction.

So in bank feeds the original transaction should be matched with the bank feed withdrawals. The reversal transactions are matched with the bank feeds deposits when the employees repay the funds. 

Check the Pay from account to find the account the reversal has been posted to. If it's the electronic clearing account, go to Prepare Electronic Payments window>>select one of the reversals>>click on Bank File and click OK. The bank file isn't created but the transaction is transferred from the electronic clearing account to the bank account to be matched in bank feeds.

Please let me know how you go with this.

If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.

[phil404]

Hi Tracey,

Thanks for your reply. I have found it has worked as you discribed however, in the bank feeds I did have to rematch the original transactions as they became unmatched. Thankfully i had not carried out a reconcile of the bank account at his stage.

[Tracey_H · Accepted solution]

Great to hear you got this resolved @phil404 , thanks for letting me know.

Please don't hesitate to post again if you need help in the future.

If my response has answered your enquiry please click "Accept as Solution" to assist other users find this information.