[Kyle Malone, CPA]

We’d like to handle cash advances using the payables module and GP doesn’t do one particular thing that I believe it should.  Below is our process but if anyone else is handling cash advances to employees without using journal entries in the end, mind sharing?

1. Issue check without voucher & debit cash advance (instead of A/P)
Dr: A/P
Cr: Cash

2. Process future invoice for employee for submitted expenses
Dr: Expense
Cr: A/P (typical invoice)

3. Run through payment cycle @ which point the invoice would auto apply to the open payment

Issue: During the apply process, there isn’t a distribution as I would expect/hope there would be.  Distribution that I believe should occur is…
Dr: A/P (from expense voucher since it’s being applied)
Cr: Advance (from original payment)

In this situation, we’d have to go manually create a JE to move after the payment cycle…

Anyone able to handle cash advances to employees without JEs getting involved?
Thanks,
Kyle
?

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Kyle Malone, CPA
Dynamics GP Administrator
CGB Enterprises, Inc.
Covington, LA
Kyle.Malone@cgb.com
985-867-3591
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[Shari Bruno]

?Hi

We treat cash advances as vendor invoices both when issued, and when reconciled. We use a GL cash advance account to hold the amount given to the employee, that is relieved when the employee turns in the reconciliation of the cash advance. Because we use payables everything is auto applied and we do not have to create any JEs.

To grant a cash advance:
Create a vendor invoice with the employee as the vendor for the amount of the cash advance
DR: GL cash advance account?
CR: GL AP account
A check or direct deposit is issued to the employee

To reconcile an advance where the employee overspent the amount of the advance:
Create a vendor invoice with the employee as the vendor for the total amount of the expenses
DR: GL expense account(s)
CR: GL cash advance account for the amount of the cash advance
CR: GL AP account for the difference
A check or direct deposit is issued to the employee for the difference between the cash advance, and the expenses

To reconcile an advance where the employee underspent the cash advance and returned part of the funds issued:
Create a vendor invoice with the employee as the vendor for the total amount of the expenses
DR: GL expense account(s)
CR: GL cash advance account for the amount of the expenses
Because the GL AP account is not used this will not create an open invoice and nothing will need to be applied.

Create a vendor return with the employee as the vendor for the amount of the funds returned:
DR: GL cash account where the returned funds will be deposited
CR: GL cash advance account for the amount of the returned funds.
The amount of the returned funds will show up as a bank deposit, and can be posted.

Hope this helps.
Shari

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Shari Bruno
Accounting Operations Manager
Bible League International
Crete, IL
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