Forum Discussion

Kadiala's avatar
Kadiala
5 years ago

Cash Receipts collected and used without banking it

Hi,   i'm new here and would be grateful to get some help.   i have some cash receipts which were not bank, rather being used.   how do i record it and will it affects my bank reconciliation an...
  • Tracey_H's avatar
    Tracey_H
    5 years ago

    Hi Kadiala 

     

    If you receive a cash payment for $500, record the full payment in either Receive Money or Receive Payments to the Undeposited Funds account.

     

    When that cash is used to make a purchase, record the purchase as Spend Money or Pay Bills to the Undeposited Funds account.

     

    If the purchase was for the full $500, in the Prepare Bank Deposit window you will have a debit transaction (Receive Money/Payments) for $500 and a credit transaction (Spend Money/Pay bills) for $500. When you select both of those transactions the Bank Deposit amount is $0.00, as such, the bank reconciliation is not affected as no amount has been allocated to the Bank account.

     

    If the purchase was for $300, when you select both of those transactions the Total Deposit Amount will be $200. This is the amount transfered to the bank account when you record the Prepare Bank Deposits transaction. You will need to actually deposit $200 into the bank account to reconcile with the Bank Deposit transaction.

     

    Please let me know if you need further help.

     

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

Kadiala's avatar
Kadiala
5 years ago

Tracey_H , Its being a practice since i joined the entity, and i'm concern if it will affect my bank reconciliation.

 

we are using AccountsRight plus. 

 

Regards

Kadiala

 

 

  • Tracey_H's avatar
    Tracey_H
    Former Staff
    5 years ago

    Hi Kadiala 

     

    The way a bank reconciliation works is to match (reconcile) the deposits/withdrawals recorded in your software with the actual deposits/withdrawals that have occurred in the bank account. So whether the bank reconciliation will be affected depends on what steps are being taken:

     

    • is an amount deposited into the actual bank account?
    • how are you recording the cash receipts and purchases in AccountRight?
    • what account are you selecting as the Deposit to and Pay From account when recording those transactions?

    To be compliant with the ATO those cash receipts and purchases need to be recorded in AccountRight and using Petty Cash is one common method for handling this situation.

     

    This help article explains how to set up and record petty cash in AccountRight: Petty Cash

     

    If you need further assistance please do provide detailed information so that I can better assist.

     

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

    • Kadiala's avatar
      Kadiala
      5 years ago

      Hi 

       

      Tracey_H , The money was not deposited in the bank, it was delibrately not deposited how ever it was used by the person.

       

      what we did was we recorded it as undeposited fund in the MYOB under received money and spend money when we actually spend the money by reducing invoices or increasing the expense account code.

       

      we did not record it as bank deposit yet as im confused incased it will affect my bank rec and causes alot of future adjustments.

       

      we have petty cash which will be recorded in MYOB, however the revenues received but not deposited is the concern.

       

      How can i ractify this situation so that my bank reconciliations will not be affected?

       

      Hope the above is clear as im new to MYOB.

       

      Regards

      Kadiala

       

      • Tracey_H's avatar
        Tracey_H
        Former Staff
        5 years ago

        Hi Kadiala 

         

        If you receive a cash payment for $500, record the full payment in either Receive Money or Receive Payments to the Undeposited Funds account.

         

        When that cash is used to make a purchase, record the purchase as Spend Money or Pay Bills to the Undeposited Funds account.

         

        If the purchase was for the full $500, in the Prepare Bank Deposit window you will have a debit transaction (Receive Money/Payments) for $500 and a credit transaction (Spend Money/Pay bills) for $500. When you select both of those transactions the Bank Deposit amount is $0.00, as such, the bank reconciliation is not affected as no amount has been allocated to the Bank account.

         

        If the purchase was for $300, when you select both of those transactions the Total Deposit Amount will be $200. This is the amount transfered to the bank account when you record the Prepare Bank Deposits transaction. You will need to actually deposit $200 into the bank account to reconcile with the Bank Deposit transaction.

         

        Please let me know if you need further help.

         

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

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