Payroll is set up with direct debits within the bank. Do I process as an electronic payment but not create the .aba file

[PRW]

Account Right user

[Sean_DC]

Hi @PRW 

Thank you for your post. When you need to process an Electronic Payment, you will need to set up your account for electronic payments. You will need to download the bank file as well for you to be able to match it or allocate it to your transactions. You can keep it and it's not necessary to send it to the bank because you are already doing direct debits. 


Please feel free to post again. I'm happy to assist further.

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

[PRW · Accepted solution]

Thanks. @Sean_DC 

I thought that may be the case.

I will create the electonice payment but not send to the bank.

I guess I can also set the payroll up as a Spend Money transaction and it will automatically match up in the bank feed with the direct debits. 

That would be right too?

[PRW]

Can I get some clarity on how the general accounting for this works.

When I run the payroll the transactions that result are:

Dr Wages/super/payroll expense accounts

Cr Electronic clearing account

When I create an aba file the transactions are

DR  Electronic clearing account

Cr  Bank account

What happens when the payroll direct debits come into the bank feed?

Do I just hide them as they are already accounted for?

Thanks

[Genreve_S]

Hi @PRW, 

Thanks for the responses so far. 

When in bank feeds, we generally use the spend money only for transactions that are not accounted for in sales, purchases, and payroll. Allocating bank feed transactions to spend money transactions will create a new transaction aside from the one created from the electronic clearing account. This would cause a double-up and would give you issues in reconciling your bank accounts. I would suggest deleting the spend money transactions so the bank feed would be matched to the electronic payment transaction. 

Let us know if you still need further assistance with this. We're happy to help further. 

Cheers, 

Genreve