Credit Card Management

OBJECTIVE

The purpose of this exercise is to demonstrate how to manage purchases made with a credit card by creating and using an internal bank account.

Setting the scene: an employee is given a company credit card to be used to purchase, for example, material or tools that will be used for the project.

 

PRerEQUISITE

• Chart of Accounts
• Bank Accounts
• Supplier Management

 

Sommaire

The credit card management process is in fact a logical progression of events. Before being able to use a credit card, you must first perform the following tasks:

• Create a Bank type account in the general ledger
• Create and internal bank account
• Create a supplier

Once the purchases are made, another sequence of events occurs:

• Create a project purchase
• Reconcile the internal bank account to the credit card statement
• Make the payment on the credit card

 

Create a General Ledger Account

We recommend, if you have several credit cards of the same type (for example, Visa), that you create one account per card. However, should you feel that it is not necessary to do so, to make the reconciling process easier, it is possible to create just one account.

maestro* > Accounting > Maintenance > Accounting > Chart of Accounts

 

1. Under the Main fields tab, refer to table below to fill the following fields.

Field	Type in / Select
Description	Visa Bank
Type	0-Bank

2. To fill in the other fields, refer to the help topic entitled Chart of Accounts.

 

Create an Internal Bank Account

Create an internal bank account from which the immediate disbursements will be processed when entering project purchases. However, should you feel that it is not necessary to do so, to make the reconciling process easier, it is possible to create just one account.

maestro* > Accounting > Maintenance > Accounting > Bank Accounts

 

1. Under the Main fields tab, refer to table below to fill the following fields:

Field	Type in / Select
GL account	Select the general ledger account that was created at the previous step
Account type	Internal
Bank name	Same name as the general ledger account that was created at the previous step. Using our previous example, Visa Bank
Reconcile disbursements	Select to display the purchases’ disbursement transactions
Reconcile receipts	Yes

2. To fill in the other fields, refer to the help topic entitled Bank Accounts.

 

Create a Supplier

Create a supplier for each product supplier where a purchase was made with the credit card. By doing so, it will be possible to identify the various locations where a purchase was made.

In addition, after having created an internal bank account and a general ledger account (in our example, they are both named Visa Bank), you must also create a supplier that will be named, in keeping with our previous example, Visa. This supplier will be used when creating a direct disbursement.

maestro* > Purchasing > Maintenance > Suppliers > Supplier Management

 

1. Refer to the table below to fill in the Code field:

To create a	Type in
Product supplier	For example, Home Depot
Credit card supplier	For example, Visa

2. To fill in the other fields, refer to the help topic entitled Supplier management.

 

Create a project purchase in maestro*

The payment of the credit card purchase is drawn on the internal bank account.

maestro* > Purchasing > Maintenance > Purchasing > Project Purchase

 

1. Under the Detail tab, refer to table below to fill the following fields:

Field	Type in / Select
Instant Disb.	Yes
Bank	Bank account configured to manage the credit card
Cheque No.	ByCard (in order to not issue a physical cheque)

2. To fill in the other fields, refer to the help topic entitled Project purchase.

 

Reconcile the Internal Bank Account with the Credit Card Statement

This step is required in order to ensure that all purchase transactions have been recorded in maestro* against the credit card statement.

maestro* > Accounting > Financial Management > Bank Reconciliation > Bank Reconciliation

 

1. In the Bank Account field, select the bank account specifically created to make payments on the credit card.
2. Select the desired period and date.
3. Click OK. The result is displayed in a new window.
4. To view all available information concerning bank reconciliation, refer to the help topic entitled Bank reconciliation.

 

Make a Payment on a Credit Card

The credit card payment is made by creating a disbursement in order to debit the internal bank account and credit the regular bank account. It is recommended to create a supplier (Visa, MasterCard, American Express…) in order to group together all payments.

maestro* > Purchasing > Purchasing > Payment > Enter a Direct Disbursement

 

1. Under the Detail tab, refer to table below to fill the following fields:

Field	Type in / Select
Supplier code	Previously created supplier, for example Visa
Account: Bank	Name of the current bank account
Breakdown	Internal bank account, for example Visa Bank
Cheque No.	Generally, number of transfer or leave blank to issue a cheque

2. To fill in the other fields, refer to the help topic entitled Enter a direct disbursement.

After having credited the internal bank account upon purchasing, we will debit this same account when creating an individual disbursement. The offset account will then be the current bank account

 

See also

• Chart of Accounts
• Bank Accounts
• Supplier Management
• Project Purchase
• Bank Reconciliation
• Enter a Direct Disbursement

 

Formerly, How-to no. 9

Last modification: November 07, 2024