I am setting up a new credit card specifically for use to pay AP invoices. I do not want to use the pay-to vendor since we would not necessarily always use the credit card payment type for all payments under a given vendor. I like the idea of setting up a bank account to help reconcile the payments issued to the monthly credit card statement. Typically the GL associated with this bank account should not allow direct posting, thus forcing all entries to go through the bank account and having the GL match the bank at all times. If anyone has done this, how do you handle getting the payment to pay off the credit card into the bank account?
We do this a lot. I set up a bank account for American Express with its own separate GL account, we also have an amex method of payment . We put the charges individually to the vendor and pull them through the American express account as “checks”. When the bill comes we debit the American express account and credit the actual bank account it comes out of, the amex account should be zero when it is cleared. Hope this helps.
Thanks for the information. Are you using the same GL for the bank account and for the American Express debit entry? If so, how are you getting the AM Ex Statement entry to show up as a debit on the bank account not just on the GL Account?
Example, our American Express bank account is tied to account 1100, we put in individual vendor invoices so we can track the invoices, debiting the expense accounts, and it auto credits our Accounts payable trade account(2500), after all the invoices are in we write “checks” out of the American express bank account crediting account 1100. When the American Express bill comes we put it in our vendor Amercian Express and we debit 1100, and it auto credits our Accounts payable trade account(2500) for the total bill. This zero’s out the American express account. When the bill is to be paid it will credit the actual bank account(1002).
Thanks for taking the time to help.
Does you bank balance for American Express bank account match the GL balance 1100 ? I’m just having a tough time grasping how to get the bank balance to match the GL balance.
When you are posting the actual American Express bill, chose bank as the account type not ledger and pick the American Express bank account. Make sure to set your payment method for AMEX to have an account type of bank not a ledger. When the bills put in individually by vendor the total equals the amount of the actual American Express bill. The only way the bank will not match the ledger is if you make entries using the account type ledger instead of the account type bank. If this happens you can make a journal entry to correct it using the account type bank and ledger to reverse it.
OK - that makes sense. I assume I would need to post the invoice to pay the Amex bill on a purchase journal instead of a purchase invoice in Nav. I don’t have bank acct as an option on my invoice account types.
Thanks again…I think I finally get it!!
When putting the Amex bill in on an invoice journal, it would be the offset account type that would need to be bank.