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dopey's avatar
dopey
Experienced Cover User
6 years ago

Payroll - Journal entry

While doing my latest bank recon i've realised I'm out by 69c and thats because I recorded a pay on MYOB but when I made the payment on the banking I short paid by 69c so now my recon is out by 69c. ...
  • Naomi_Roskell's avatar
    Naomi_Roskell
    6 years ago

    Hi dopey 

     

    As a Bookkeeper, it is my job to ensure that all transactions are clear and understandable, that anyone who comes after me can follow what I do and nothing is left to a scratching head...

    Which explains why I'm really not a fan of Journal entries when it comes to over or under payments, especially with regards to Payroll, Super and Tax, so the advice that I would give you is to create a negative Spend Money Transaction that affect the Bank Account from which the payment should have been made and allow the funds to sit in a "2-9999 Suspense A/C" until such time as the balance of the payment is made. This will bring your payroll back by the underpayment of 0.69 and allow you to complete the Bank Rec. The following weeks payroll should be overpaid by the same amount. At the time you need to process the following Payroll, the overpayment would be affected to the Bank Account as a Spend Money Transaction which is then allocated to the Suspense A/C for the same amount, negating the original transaction. Ensure at each point, the Memo clearly states the Employees Name the under/over payment relates to, the reason and the "W/E: XX/XX/XX" when the original under/over payment was made. So that in the future, anyone who comes across these transactions knows exactly what, why, when, where, who and how.

     

    Hope this helps, if it does, please mark as the solution and provide your kudos, GOODLUCK!!!

     

    Naomi

Naomi_Roskell's avatar
Naomi_Roskell
Trusted Cover User

Hi dopey 

 

As a Bookkeeper, it is my job to ensure that all transactions are clear and understandable, that anyone who comes after me can follow what I do and nothing is left to a scratching head...

Which explains why I'm really not a fan of Journal entries when it comes to over or under payments, especially with regards to Payroll, Super and Tax, so the advice that I would give you is to create a negative Spend Money Transaction that affect the Bank Account from which the payment should have been made and allow the funds to sit in a "2-9999 Suspense A/C" until such time as the balance of the payment is made. This will bring your payroll back by the underpayment of 0.69 and allow you to complete the Bank Rec. The following weeks payroll should be overpaid by the same amount. At the time you need to process the following Payroll, the overpayment would be affected to the Bank Account as a Spend Money Transaction which is then allocated to the Suspense A/C for the same amount, negating the original transaction. Ensure at each point, the Memo clearly states the Employees Name the under/over payment relates to, the reason and the "W/E: XX/XX/XX" when the original under/over payment was made. So that in the future, anyone who comes across these transactions knows exactly what, why, when, where, who and how.

 

Hope this helps, if it does, please mark as the solution and provide your kudos, GOODLUCK!!!

 

Naomi

dopey's avatar
dopey
Experienced Cover User
6 years ago

Hi Naomi

 

Thanks for that and I also agree about the journal entry ...scratching the head thing. I'm going to try this but there are quite a few weeks between the short payment and the week the balance will be paid as I've only realised it when I tried to do the recon. I guess this is a better option so I can continue to reconsile the accounts and not wait till our financial year end for the accountant to do the journal entry.

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