Got another “best practices” Q for all you experts: We reimburse each employee’s medical cost.
They way it would happen is: I go to the doctor, I get charged $20. I pay first, then I pass this bill to the HR dept. The company then reimburses me in 2 weeks.
Acct would like to monitor, by department and employe, how much they have spent in a certain period.
One option we have been advised to do is to have each employees as vendors (with Department as dimension), attached to responsibility center “Medical”. When I go to the doctor and hand in the bill, then what would happen is HR (HR login secured to Medical Resp. Ctr, so they cant see vendors other than those belonging to Medical … can this be done?) would make a PO straight to GL acc:
The journal behind the PO would be:
Medical Fee 20
Payable - Emp. Med Fee 20
When the time comes to reimburse, the journal would be:
Payable - Emp. Med Fee 20
Cash 20
Is it a good way of doing it? Can the kind of tracking that acct want to do be done with the above method … Is there a better way?
Note: Employee loans would be treated in a similar way, but the employees are setup as a customer, Resp Ctr = “Emp Loans”, journal is the opposite (against receivables), etc etc…
Note2: We dont have HR granule…would this do what we need to do easier?
I think this is the right way to go. Using base application is always better than coding. I have often used the Vendor functionality to do this. Its also good for loans, commissions, bills paid by employee’s own credit cards etc.
Can only agree with David (as always [:)]…) this vendor functionality will work fine, and you can out of the box use all the standard functionality (like suggest vendor payment, print checks, and cash flow planning and so on…)
I just wouldn’t repeat the same employee as customer, I would try to stick as much as possible to the vendor module, simply setup the posting groups accordingly… It’s just a matter of handling, simply with the intention of not mixing your sales part (which is usually a bit more sensitive and critical) with administrative part, and like this the HR people handling this kind of administrative stuff won’t need access to the sales module… keep in mind that you’d have to give access for the HR people to almost the whole AR module…