When a company credit card is used, the transaction comes from the bank and hits the employee who must perform the actual settlement.
Step 1: The Expense (User's Registration in Acubiz)
When the employee opens Acubiz, adds their receipt, and selects the correct expense account, the expense is released to operations. The temporary provision for operations is reset.
Debit: Expense Account (Operations) – e.g., Hotel or Representation
See also the derived flows: Cash Withdrawal on Company Credit Card: and Private Purchases on Company CardCredit: Provision for Operations (Balance or Bank) – Counter-entry to Credit Card
Why? The expense is now correctly placed in the income statement, and the account for "Provision for Operations" is zeroed out (offset) for this specific transaction.
How to set up the accounting for the above setup
Derived Flows
There may be derived flows for common expenses explained below
Cash Withdrawal on Company Credit Card:
Cash withdrawals are typically made in situations where card payment is not possible. In Acubiz, a cash withdrawal is registered and handled as an advance salary paid to the employee.
How to set up the accounting for the above setup
The Principle: From Expense to Receivable (Employee Debt)
It is when the employee must settle the transaction that the derived flow is activated. Instead of choosing an expense category (e.g., "Travel Expenses"), Acubiz automatically selects a system account called "Cash Withdrawal on Company Card". Now the transaction is recorded as an intercompany balance between the company and the employee.
Step 2: User's Registration of Cash Withdrawal
When Acubiz marks the expense as a cash withdrawal, the debit accounting changes. Instead of an expense account, the company's receivable from the employee is debited. Typically, one of two methods is used depending on the company's payroll system and ERP setup:
| Method A: Employee Intercompany Account (Payroll Deduction) | Method B: Employee Creditor (Clearing Account) |
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This method is most often used if the amount is automatically deducted from the employee’s next payroll payment.
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This method is used if the employee must repay the amount to the company via bank transfer, or if intercompany balances are settled manually.
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| How is the intercompany balance closed (Step 4)? | |
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When an employee withdraws cash for business purposes – for example, in connection with a business trip – the withdrawn amount is considered an advance salary and thus a debt to the company. The employee is obligated to document all expenses incurred. This is done by continuously registering expenses as reimbursements and attaching valid receipts, after which the amounts offset the employee’s outstanding debt. Lack of documentation: If there is a remaining amount that cannot be documented with relevant receipts, it is considered an outstanding balance with the company. Below are options for final settlement | |
In connection with payroll processing, the employee’s paid salary is reduced by the given amount. The offsetting is then automatically posted via the payroll system to the ERP system’s intercompany account, after which it is zeroed out. |
When settling intercompany balances on the employee creditor account, any outstanding balances can be handled as follows if the employee owes the company money:
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How to set up accounting for cash withdrawals on company credit cards
Private Purchases on Company Card
The Principle: From Expense to Receivable (Employee Debt)
It is when the employee must settle the transaction that the derived flow is activated. Instead of choosing an expense category (e.g., "Travel Expenses"), the employee selects a specific category in Acubiz called "Private Purchases on Company Card". Now the transaction is recorded as an intercompany balance between the company and the employee.
Step 2: User's Registration of Private Purchase
When the employee marks the purchase as private in Acubiz, the debit accounting changes. Instead of an expense account, the company's receivable from the employee is debited. Typically, one of two methods is used depending on the company's payroll system and ERP setup:
| Method A: Employee Intercompany Account (Payroll Deduction) | Method B: Employee Creditor (Clearing Account) |
|
This method is most often used if the amount is automatically deducted from the employee’s next payroll payment.
|
This method is used if the employee must repay the amount to the company via bank transfer, or if intercompany balances are settled manually.
|
| How is the intercompany balance closed (Step 4)? | |
| In connection with payroll processing, the employee’s paid salary is reduced by the given amount. The offsetting is then automatically posted via the payroll system to the ERP system’s intercompany account, after which it is zeroed out. |
When settling intercompany balances on the employee creditor account, any outstanding balances can be handled as follows if the employee owes the company money:
|
How to set up accounting for private purchases on company credit cards
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