MYOB Essentials - Bank Rec/Payroll

[TonyDobbo]

Hi Team

I am very much a MYOB Beginner - I'm finding it really hard as nothing seems to be set out logically (maybe its just me....)

Payroll was processed with 1 employee, net pay $9,200

It was paid through the bank as 2 payment amounts $9,000 and $200

I can't match them on the bank rec

What am I doing wrong?

regards
Tony

[Greenheart · Accepted solution]

Your using MYOB that's what your doing wrong

[Steven_M]

Hi @TonyDobbo 

MYOB Essentials assumes that payroll transactions will be processed as a lump amount to the employee. Paying in separate payments can generate a different situation than the actual payroll transaction. The best way to get that deal with that situation would be to separate the payroll transaction into the payment amounts through a holding account. I've outlined the process I would be using for you:

Please note: The below process assumes that the pay has yet to be processed. If you have already recorded the pay it would be recommended to delete/reverse that pay before continuing.

1. Create a holding account - Accounting>>Chart of accounts>>Create account -- give the account a number, name and set the account type to be Bank.
2. Once that has been created, go to Accounting>>Manage linked accounts>>Payroll
3. Update the Bank account for cash (or cheque) payments to be that holding account
4. Navigate to the employee's record - Payroll>>Employees>>Select the employee>>Payment details>>Update the payment method to be that newly set bank account method i.e. Cash or Cheque
5. Process the pay for the employee
6. Once that pay has been recorded, navigate to Banking>>Spend money and generate a bank transaction with the bank account being the main bank account and the account being that holding account for the desired amount.
7. Process a second Spend money transaction for the second payment amount.
8. Match the Bank transactions to that Spend Money transactions recorded.

In theory, you could look at allocating the bank transactions to the necessary holding account thus not completing Step 6-9 as this would achieve the same result.

[TonyDobbo]

Hi Steven

Thanks - I've already processed the pay

Is there a way of reconciling without having to reverse the payroll?

It will become a red flag from an audit/control perspective if we adjust the payroll after it has been processed

regards

Tony

[Steven_M]

Hi @TonyDobbo 

The only way I that those bank transactions to be matched without the need to delete the transaction is through a holding account transaction and doing an adjustment to the bank transaction. I've included that process below:

Note: The below process will use a holding account in my example I have used a liability account "Liability #2".

1. Navigate to Banking>>Bank transactions
2. Choose the required bank transaction i.e. the $9000 withdrawal
3. Select Match transaction
4. From within the Show, select All transactions
5. Tick the paycheque transaction. This will leave an out of balance amount of -200.
6. Select Add adjustment
7. From the Add adjustments or rounding section, enter in the selected holding account and a negative amount of (-200.00). This will balance the transaction.
   
   
   
8.  For that second transaction, you want to allocate that to the holding account i.e
   

In terms of overall impact, the above process will allocate the two banking transactions while also recording the transaction to that holding account and then clearing it.

[TonyDobbo]

Thanks Steven

I've followed your instructions and to be honest I am completely lost

It is so complicated for such a basic, fundamental transaction

[Steven_M]

Hi @TonyDobbo 

Happy to offer some further insight into the above workaround to your situation if you would like to provide additional information into where you are getting stuck at.

[TonyDobbo]

Hi Steven

If I try to allocate the salary payment in the bank reconciliation, I select Banking, then Bank Transactions, and list the unallocated transactions.

I select the payroll payment and when I go to match with the payroll, filtering on All transactions, the amount posted by payroll does not appear

If it is possible to walk through this over the phone, or if I can allow MYOB support access to the file that would be make things so much easier and quicker?

regards

Tony

[Steven_M]

Hi @TonyDobbo 

For Payroll transactions, the amounts do need to match up with the bank transaction amount being the system assumes that you have paid the employee the full amount as one payment. With your situation, this pay transaction was not paid as one full amount and therefore the bank transaction system will not locate that transaction.

Using one of the above processes i.e. deleting the pay and then reprocessing it as two amounts OR using that adjustment option when doing the Bank allocation would be able to successfully allocate that transaction. As it wouldn't be a common process I've listed the exact steps required, however, happy to offer you some further guidance through this channel if you need to in relation to one of those processes.

Not: Those options would be how I would approach the situation others in the Community may have some further ideas on how best to deal with that situation.

[TonyDobbo]

Hi Steven

Your instructions - 

1. Create a holding account - Accounting>>Chart of accounts>>Create account -- give the account a number, name and set the account type to be Bank.
2. Once that has been created, go to Accounting>>Manage linked accounts>>Payroll

I cannot see an "Accounting" option to select??