Banking

Enter Bank Fees

If you have paid bank fees to your financial institution (eg your bank), there are several ways to record the transaction in Saasu.

Journal Transaction:

1. Select Add > Journal in the main menu to load the Journal Entry screen.
2. Enter the transaction date and set the contact as your bank.
3. Enter a summary (eg bank fees).
4. Add the following line items to represent the two entries required to capture the $5.00 bank fee:
   

   Account	Tax Code	Debit	Credit
   Asset: Rocketimo Bank A/C	– No Tax Code –		5.00
   Expense: Bank Fees	(choose tax code for your zone)	5.00

5. Save the transaction.

Purchase Transaction:

1. Select Add > Purchases.
2. Set the first dropdown to Money out (Expense).
3. Enter any required details for the invoice (eg the date, etc).
4. Select the account you have set up for this type of transaction (eg Expense: Bank Fees).
5. Select the appropriate tax code for your zone.
6. In the Quick Paymentsection of the screen, enter the date the money was received and choose the appropriate bank account it went into (eg Asset: Rocketimo bank A/C).
7. Save the transaction.

Import Bank Statement and Categorise Transactions as Bank Fees

1. Select View > Import and Export.
2. Select Import Bank Data.
3. Import your bank statement into your Saasu file.
4. Tick the checkboxes beside all the bank fee transactions in the imported items list from the statement.
5. Select Purchase with payment from the transaction type pick list.
6. Select the account you have set up to record these types of transactions (eg Expense: Bank Fees).
7. Select the appropriate tax code for your zone.
8. Click Categorise.

Interest Received

If you have received interest from a financial institution such as a bank, there are several ways to record the transaction in Saasu.

Journal Transaction:

1. Click the Add for Journal in the main menu to load the Journal entry screen.
2. Enter the transaction date and a brief summary of the transaction (eg Interest from Bank XYZ).
3. Add the following line items to represent the two entries required to capture the $20.00 interest received:
   

   Account	Tax Code	Debit	Credit
   Asset: Bank XYZ A/c	– No Tax Code –	20.00
   Other Income: Interest Received*	(choose tax code for your zone)		20.00

4. Save the transaction.

Sales Invoice:

1. Click the Add icon for Sales in the main menu to access the Add Sale screen.
2. Enter any required details for the invoice (such as the date, etc).
3. Select the account you have set up for this type of transaction (eg Other Income:Interest Received*).
4. Select the appropriate tax code for your zone.
5. In the Quick Paymentsection of the screen, enter the date the money was received and choose the appropriate bank account it went into (eg Sample XYZ A/c).
6. Save the transaction.

Import Bank Data and Categorise as a Sale with Payment:

1. Click the Add icon for Bank Import in the menu to access the Import Bank Statement screen.
2. Import your bank statement into your Saasu file.
3. Tick the checkbox for the interest paid transaction in the imported items list from the statement.
4. Select Sale with payment from the transaction type pick list.
5. Select the account you have set up to record these types of transactions (eg Income:Interest Received).
6. Select the appropriate tax code for your zone.
7. Click Categorise.

* This account may differ depending on your particular circumstance. For example, it could be Income:Interest Received or another variation.

Bulk Payment Files (Australia)

Saasu supports Direct Entry (DE) or Bulk EFT (Electronic Funds Transfer) ABA files. They are a convenient way to make bulk payments by uploading these to your online banking application.

1. Speak to your bank institution and get the required authorities to process DE ABA files through online banking.
2. You should receive a Bank Code (3 letters) and Client User ID (Direct Entry APAC ID) for processing DE ABA files from your bank institution.
3. Go to the View > Bank Account add/edit screen for the bank account you will use to make payments from with the DE ABA files.
4. Ensure the details are filled in correctly. See this example (which has Saasu’s code blanked out):
   
5. Ensure you have entered EFT banking details against each contact you will be paying via this method. The DE ABA file won’t validate unless every payment has correct bank details against its contact.
   
6. From a list of unpaid purchases, tick the boxes against the ones you wish to pay.
7. Choose pay selected and enter the details including the reference (as DE ABA or similar).
8. Save the payment – A DE ABA will become available. You can save this to your desktop by clicking its link.
9. Sign in to your online banking account and upload the file to the appropriate area for processing by your bank. Because each bank is different, you will need to follow instructions in your bank website or contact them for detailed direction on uploading the file.

Bulk Payments won’t work for my Bank

Different banks have different rules for accepting the bulk DE ABA files. If your Direct to Bank payment file is not accepted by your bank’s Internet banking application, this might be due to one of the following reasons:

• With certain banks, the business name that appears in the DE ABA file must be the same as the one you have registered with the bank in order to obtain the bank User ID for DE ABA file processing. Consequently, it is important that the name you have entered under Settings < Manage File Identityarea is exactly the same as the one you have given as your organisation name to the bank. Note that the maximum number of characters allowed for the organisation name in Saasu is 75 characters.
• It’s always better to enter a transaction summary when you apply a payment. If you do not enter a transaction summary, by default, the payment file will be entered as the summary for the payment. It is important you enter a transaction summary related to the payment you applied so that when it appears in your bank statement you know what the payment was for. Note that the transaction summary gets truncated in the DE ABA EFT file if it’s longer than 12 characters.
• The account name you enter as the bank account name when you are setting up the bank account in your Saasu file has to be same as the one created for you by the bank. For example, if the account name is John Citizen with the bank XYZ, the account name you enter when you set up bank XYZ in Saasu should also be John Citizen.
• Certain banks do not accept special characters in their DE ABA files. Consequently, it’s important you do not enter any special characters such as ‘#, *, ^’ in the summary for the payment you are applying or for your invoice numbers.

More info for your bank
Commonwealth Bank

Apply Payments from Imported Bank Data to Existing Transactions

If you have received a payment for a sale or if you have made a payment for a purchase through your bank account, you can apply this amount to the corresponding sale/purchase you have already created in Saasu. For example, you have received $200 for a sales invoice you issued last week. In order to apply this as a payment for the sales invoice:

1. Import the bank statement into Saasu first.
2. Select A payment applied to Sales from the pick list as the type of transaction you want to create.
3. Select the contact the particular sale belongs to from the contact pick list (if you can recall this) or leave it as All Contacts.
4. Tick the checkbox at the beginning of the particular transaction in the imported bank statement, which has the payment amount you received.
5. Click Categorise Selected – You will be taken to the list of sales invoices with pending payments for the particular contact or for all contacts.
6. Locate the invoice from the list that the payment is for and enter the amount (eg $200).
7. Click Save.

You can follow the same steps above to apply payment for a purchase invoice. To do this, simply select A payment applied to purchase as the transaction type for this scenario.

Bank Deposit Listing

Some businesses bank quite a few cheques or cash deposits and would like to print a report rather than fill in a deposit slip at the bank. Here’s a simple way to generate a list of banks for the day if your bank accepts this format.

In the Payment screen you will need to do the following:

1. Ensure your bank account name in Saasu matches your actual bank account name at the bank.
2. Ensure you apply one payment per cheque/check or cash quantity.
3. In the Summary field, include the contact name as seen on the cheque/check.
4. In the Referencefield, include the branch and account numbers if your bank requires this (eg 032-044 379215).

Run the Day’s Deposit Listing:

1. Select View > Sale Payments.
2. Set the filters to today’s date and select the relevant bank account.
3. Click Show.
4. Print the screen using the browser print option – Ensure you print in landscape mode.

Over Payment

When customers over pay you there are a variety of ways to handle the overpayment. A few have been shown as examples below. Please consider the timing and tax implications for your specific circumstance as these are general examples.

Issuing a Refund for the Excess Amount – Invoice Method

1. Create an invoice and code it to a Loan account such as Loan: Over-payments or similar. Then when payment is applied, it will be to the outstanding invoice and the overpayment invoice at the same time.
2. Duplicate this overpayment, change it to a Credit/Adjustment Note/Invoice (depending on your zone) and invert the sign against the Amount. Don’t apply any payment to it as you haven’t repaid the customer yet.
3. This captures the transaction for the original invoice, the overpayment, and the refund of the overpayment for which only the last is still open. This has the effect of creating a credit on the Statement for this customer. Use the open Credit/Adjustment Note/Invoice when you do a future transaction and apply payment to it that is less than the full amount. i.e. the customer will pay you less as they know they have a credit.

Issuing a Refund for the Excess Amount – General Journal Method

1. Apply a Payment to the Sale as you would normally for the portion of the Payment that will cover the Sale amount. You will obviously have a residual amount left over at this point.
2. Enter the residual amount (the remaining portion – the over payment) as a General Journal transaction for the same transaction Date as the Payment Date (not the Sale date) that you used above. For example, if you had received $150 for a $100 Sale then the General Journal entry would be:
   

   DEBIT	Asset: MyBank Account for $50 (leave tax code blank)
   CREDIT	Loan: Deposits Received for $50 (leave tax code blank)

3. On the day you decide to pay a refund, create a General Journal entry that represents the refund payment you make (the over payment portion). E.g. If this was refunded using your bank account then the entry might be:
   

   CREDIT	Asset: MyBank Account for $50 [leave tax code blank]
   DEBIT	Loan: Deposits Received for $50 [leave tax code blank]

NOTE: The General Journal transaction is clearing out the first one, just at a later date. This may be important when reporting your Balance Sheet position, particularly if this occurs over a financial year end or another tax reporting period.

Applying the Overpayment to Another Invoice

1. From the list of sales, search for the Sale which the payment was intended for, and tick the checkbox for it.
2. Click the Pay Selected link at the top of the List of Sales – The Receive Payment screen will display.
3. Where it says Show outstanding invoices for, choose the Contact you have received the overpayment from and then click Show Unpaid Sales to get everything for that Contact to display in the list.
4. Tick the box beside the Sale that this payment is for and enter the full amount required to clear the sale.
5. Choose another Sale (or Sales) to apply the balance of the payment to.
6. Tick the box beside that Invoice and enter the balance of the payment that is available – At the bottom of the screen the Amount remaining to be allocated should balance to zero.
7. Click Save and Close.

Taking the Excess as a Pre-payment Deposit.

Lets Say you have $90 of outstanding invoices but the customer is paying you $100 so they have overpaid by $10 and requested that you hang on to the funds as a credit on their account…

1. Create a Sales Invoice and book the $10 overpayment amount to Liability: Deposits Received without a tax code…
   

   Account	Tax Code	Amount
   Liability: Deposits Received	No tax code	10.00

2. Later when you issue a new Sale to the customer and they make a payment they will be underpaying by the credit amount. So we want to create this new invoice to include the reversal of the credit.
   

   Account	Tax Code	Amount
   Income: General	Your GST/TAX code	100.00
   Liability: Deposits Received	No tax code	-10.00

The customer will be paying you $90 as they know they have a $10 credit with you. Apply a $90 payment to the Invoice above to clear it as paid.

Receipt of Money in Error

Occasionally a contact might accidentally deposit money in your bank account in error, as overpayment or through accidental duplication.

These transactions can be handled in several different ways – You can:

1. Refund the amount.
2. Accept the amount as a deposit for goods or services already ordered.
3. Apply the extra payment to a different Sale.

This support note will deal with the first example above. The other two examples are handled by payments and deposits for goods and services.

Booking the Received Money and Refunding it
Assuming you have received funds in your bank account and then later repaid them from that same bank account, the following entries would reflect these transactions:

In this example, we use a Liability Account to clear the amount received in error. If you aren’t sure that this general method applies to you, we strongly recommend you check with your accountant first.

NOTE: Amounts are always entered as positive numbers in General Journals.

1. Click the add icon to create a new General Journal from the main menu – The Add General Journal screen will display.
2. Date the transaction the day you received the money in your bank account.
3. Add the following transaction items:
   NOTE: Don’t select any tax codes.

   DEBIT	Asset: Bank Account	$x
   CREDIT	Liability: Deposit Received	$x

4. Click Save and Add Another – The Add General Journal screen will display again.
5. Date this second transaction the date you repayed the money from your bank account.
6. Add the following transaction items:
   NOTE: Don’t select any tax codes.

   CREDIT	Asset: Bank Account	$x
   DEBIT	Liability: Deposit Received	$x

7. Click Save and Close.

You have created two General Journal transactions that will allow the amounts to appear in your Bank Statement report. This will make it easy to reconcile your bank account when the time comes. The Liability: Deposit Received account is acting as a clearing account. It allows the amount received and later paid to balance each other out even though they might not occur on the same date.

Cheque Payment Deposits

Businesses may sometimes deposit several cheques by customers at once to their bank account. This will show up as one deposit amount in the bank statement, and the best way to reconcile this in Saasu is by using an “Undeposited Cheques” clearing account. Consider the scenario where you have received payments by cheque worth $5000.00 from customers within a week for several invoices.

1. Create an “Asset: Undeposited Cheques” or similar account if you have not created one already.
2. Apply the payment to the corresponding invoice for the cheque from the customer, and make sure you select the above “Asset: Undeposited Cheques” account as the bank account for the payment. Repeat this process for all other cheques as you receive them.
3. After you deposit the cheques to your bank account at the end of the week, create a journal entry to clear the “Asset: Undeposited Cheques” account as follows;
   

   Account	Debit	Credit
   Asset: Bank Account		5000.00
   Asset: Undeposited Cheques	5000.00

4. If you are using automatic bank feeds in Saasu, you will see the cheques you deposited as a single deposit amount in the feed. You can reconcile this feed item against the Journal Entry you created above by clicking on the Search icon in the feed item and selecting Journals.
5. If you are not using automatic bank feeds in Saasu, you will see the journal transaction in the bank reconciliation report for you to tick in order to reconcile.

Cancel a Cheque

Lost or stolen cheques are valid while they haven’t formally been cancelled through your banking institution. If you no longer physically hold the cheque (check) or it hasn’t been destroyed, there is always a risk that it can be deposited maliciously or otherwise. This may occur even after you have re-issued another cheque in replacement for your supplier. A supplier won’t necessarily check to see if you have already paid them so you need to cancel the cheque to be sure by notifying your banking institution (bank fees may apply).

If you have already claimed the expense in a tax filing/return, you can’t just delete the transaction. You will need to use a method that will make an adjustment to your next accounting period which will reverse any tax previously claimed.

Cancelling a Cheque if it was in a Previous Tax Period

In this general journal example, the original cheque issued is reversed. This ensures your next tax remittance includes a ‘reversal’ of the previous GST credit. It also enables you to clear the undrawn cheque from your bank reconciliation.

1. To start a new journal, select Add > Journal.
2. Enter the first line to be a DEBIT entry for the Asset bank account you issued the cheque from. Don’t select any tax code.
3. Enter the second line to be a CREDIT entry for the Expense account you previously used when the original cheque was created. Select the same tax code as the original expenditure transaction or use a reversing tax code relevant for your zone.

Why can’t I just delete the transaction?
Deleting a transaction means you have no record of it (in this case a cancelled cheque). So there are audit and business issues involved when doing this.

Dishonoured, Bounced or Returned Cheques/Checks

Sometimes cheques (checks) you receive may be dishonoured, bounced or returned for a variety of reasons. Accordingly there are different ways to capture this type of transaction. Cheques usually dishonour, bounce or get returned because of post-dating, lack of funds in the drawings account, stop cheque requests or insufficient or incorrect signatories.

For example, payment is often considered conditional on cheque clearance, so you might like to consider legal, legislative, and internal issues that impact your accounting. We recommend you consult your adviser about which method is best for your situation. If you learn of any more please let us know so we can add them to our list:

Sample Methods for Capturing Dishonoured, Bounced or Returned Cheques:

1. Delete the payment applied to the original sale that represents the dishonoured, bounced or returned cheque. Create a Purchase or Journal to represent the bank fee and flow of funds through your bank account for the original dishonour, bounce or return. Request a new payment from your customer or wait for their notification that the original cheque can be re-deposited. Create a Sale to charge your customer for dishonour, bounce or return. Add admin fees (if applicable).
   NOTE: This may not be suitable if you have already submitted tax or other regulatory information based on the entry.
2. Close the original sale with a payment. Issue a new Sale Adjustment/Credit Note using the the money reversed out of your bank to close it. Create a Sale to charge your customer for dishonour, bounce or return and admin fees (if applicable).
   TIP: Check with your advisor regarding whether this is an acceptable practice in your tax zone.
3. Apply the payment received against your Sale. Enter a General Journal for the reversal the bank puts through to represent the money the customer now owes you again. For example, you could choose an account code such as Liability:Failed Settlements or Liability:Dishonoured Payments or similar. Use this account to track who owes you money for dishonoured cheques. Create a sale to charge your customer for dishonour and admin fees (if applicable).
   NOTE: This method has the disadvantage of not tracking the liability against the actual contact in the Liability: Money Owed To Me account. However, it does keep the sale transactions clear of deletions or edits.

How long should I wait before cancelling a cheque?
Any lost or misplaced undeposited cheque is risky. You may be vulnerable to fraud such as revealing your signature or leaving open the possibility of a copy or counterfeit cheque being created in its place (each cheque has a unique number series). Consequently, it’s a good idea to review uncleared cheques at financial year end. Better still, you should do this at the end of your regular accounting period to see whether you can clean things up.

Affiliate or Channel Partner Accounts

You sell a company’s products and services and have a credit of $25 with them. If this is cashable, you can create the sale and leave it as unpaid until such time as you cash out the credit. You can then book the transaction to a Contingent Asset account. This area is tax sensitive so speak to your accounting advisor regarding this.

Manage a PayPal Account

You make an initial deposit into your PayPal account and later buy products using this account. Create a bank account called PayPal. Book the deposit using the Bank Transfertransaction screen. When you buy a product and pay for it using PayPal, simply apply payment to the purchase using this newly created PayPal account. Regularly reconcile your PayPal account as you would any other bank account.

Failed or Rejected Payments

Sometimes in business you pay suppliers, employees or refund customers and the payment leaves your bank account only to come back in a day or more later. This is usually because payment instructions weren’t correct.

Generally rejected transaction by a bank would require a Journal entry to account for the rejected payment. This Journal usually has one side as the bank and account and the other as the account you wish to post the funds to until your retry payment. Often businesses use a “Asset: General Clearing” type account etc. to post these to until they may a new payment using this same account.

On the date the payment was rejected:

Account	Debit	Credit
Asset: Bank Account	100.00
Asset: General Clearing		100.00

On the date the payment was re-tried:

Account	Debit	Credit
Asset: Bank Account		100.00
Asset: General Clearing	100.00

Multi-currency Bank Transfer

Quite often businesses repatriate money back to the home currency bank account from foreign currency bank accounts. You can enter this type of transaction into Saasu using a Journal screen as per the following example:

1. From the main menu, select Add > Journal.
2. Change the currency to be that of the Foreign Bank Account (EUR in the pictured example).
3. Select a contact if you want to track these types of transactions against the bank you used to arrange the transaction.
4. Enter a summary that explains the transaction.
5. Enter a credit amount for the Bank Account the money is leaving.
   Please ensure that the currency of the transaction and the currency of the account you’re crediting are the same
6. Enter a debit amount for the Bank Account the money is arriving in.
7. Untick the currency feed.
8. Enter the rate the bank has provided manually (or wait and see what the exchange rate is on your bank statement).
9. Add an extra line to the journal if you want to split out Bank Fees from the Currency Exchange amount.

Merchant clearing accounts

Often a clearing account is used in business to help with balancing the amount of money your merchant facility deposits into your bank account each night.

• Setup a Bank Account called Asset: Merchant Clearing.
• Use this Bank Account to apply payment to individual transactions that your customers have paid via the merchant facility.
• Either; At the end of day, create a journal where you DEBIT Asset: ABC Bank A/C (adds money to the bank account in Saasu) and CREDIT Asset: Merchant Clearing (offsets all the small payments received in that account during the day). -or- Create a Journal using the Create As option in the bank feed.

In this way one big amount appears in your Bank AC to reconcile against. Sometimes the journal requires an extra line for merchant fees

The end result is that the clearing account should balance over time. When it does this has the benefit of highlighting a bank error or an error in your own payment processing systems.

Payment Difference

Sometimes there may be a few cents difference between the payments you receive or make and the original transaction in Saasu.

In this example, you may have issued for which you received a slightly different payment amount from your customer. You don’t want to annoy them and so decide it’s better to write it off or issue a refund for the small amount.

In either case, you need to decide on the appropriate (a) Transaction Type and (b) Account Code for this transaction. These are accounting decisions you may wish to discuss with your advisor. In the following example, you have an unpaid sale for $100.50. The customer pays you $100.00 and you decide not to chase up the remaining $0.50.

1. Create a refund, adjustment note, or credit note (this depends on your zone and/or accounting treatment of these transactions). You can do this by changing the Invoice Type picklist from Tax Invoice to Credit Note or Adjustment Note.
2. Select an Income or Expense account to allocate it to (eg Expense: Rounding and Differences).
3. Enter a negative amount for the $0.50.
4. This will appear as a negative amount in the P&L if you code it to an Income account or as a positive amount if you code to an Expense account.
5. Apply a payment of $100 to both the original $100.50 invoice and the -$0.50 refund to clear them both as paid. You need to do this in one payment transaction. Change the contact and click the Show button beside the contact picklist to see all outstanding invoices so you can apply payment to both.

Rounding Differences

Welcome to the world of cents and dimes! Sometimes as accountants and business owner every last cent counts. Unfortuneately you can get situations where we can’t find that last cent. Well it could easily be our fault. In Saasu you will sometimes see differences of a cent or more where you would expect two numbers to match. There are several legitmate reasons for this which can’t necessarily be removed entirely:

1. High levels of decimalisation – means that data is stored in Saasu sometimes down to 6 decimal places. Typically, it’s foreign currency or inventory-based amounts that require this level of decimalization. Totals in screen sometimes have to round these numbers. Then other numbers are calculated basis these rounded numbers. We could do the calculations off unrounded numbers but then we need to display all the decimals to make it keep it consistent with that level of detail – and that can look ugly.
2. Roll-up of rounding in totals – lots of small transactions when summed from rounded numbers can generate a difference to total numbers in a report. The data being used in the reports comes from the same source so consequently, from an accounting point of view, it’s generally balanced. On screen, it can appear to be out by a cent. Sometimes it can be out by more if lots of transactions are involved and we are creating a total amount to display on the screen.
3. Rounding differences in tax amounts can occur where Saasu uses what’s called the Line Items method of working out tax on each line in a transaction. Other systems use the Gross Taxable method (e.g. MYOB). We feel the line item method is more data entry friendly as you don’t get non exact tax amounts on individual lines in a transaction. These can be very annoying for data entry people.
4. Technical reasons include the rounding methodologies adopted. In our case, we use the standard Microsoft SQL server rounding implementation used by thousands of financial services businesses around the world.

In summary it’s hard for us to achieve a perfect result. In fixing one situation we actually cause a problem for people in another. That is, it is essentially unsolvable for all requirements. We can solve the problem to a degree by forcing 2 decimals on our customers. However many businesses deal in micro payments and need at least the third decimal. Several inventory, commodity-based or multi-currency business models need high levels of decimalization also.

For example, an inventory item called SMS is set up and costs 18.5 cents (being 0.185). Saasu’s:

• screen will display 0.19 on several screens and reports that round to 2 decimals.
• database will be storing 0.185.

Extra decimals are critical for very high volume turnover inventory items – Typically commodity and virtual items. A side effect of this is that you may see, for example, two SMS transactions added together to equal 0.37, while the onscreen result would imply it should be 0.38 cents and can generate a difference. This can affect the sales list screens, reconciliation reports, and other areas. However, generally being a display issue, it resolves itself because these two separate transactions end up forming one part of an aggregated historical account balance or an amount in a report.

For your zone
Australia – See this advice from the ATO on GST rounding methods.