Examples of Employee Non-Supplier type expenses include:

• Petrol expenditure
• Hotel Accommodation
• Rail fares
• Taxis

Employee Expenses do not relate to an existing Supplier in the Accounts Payable system.

Best Practices

The easiest way to manage them is to:

1. Set up each Employee as a Creditor in the AP System. Set up these records as a separate section, by using a reserved prefix or suffix in the Supplier Code. See Managing Supplier Master Records for more details.
2. Additionally, you could set up a separate Creditors Control (AP) Account for this group. To link the control account to each Supplier, go to their Master Record and select it in the Account Settings tab. 
3. When you receive an Expense Claim from an Employee treat it like any other incoming Invoice. Enter it in the Purchasing System against the relevant Employee’s Expense Account, recording the VAT and relevant analysis codes. 

   Tip

   We recommend using the Batch Invoice Entry process. The F6 function key shortcut will create a single multi-line Invoice and speed up data entry.

    
4. Attach a scan of the Expense Claim Form and its Receipt Dockets to the Invoice or the individual Line Items. Use either the Supplier Account screen to attach all images to the Invoice total, or the Transaction Browser to attach individual images to each Posting Transaction. See Adding Attachments and Notes to Transactions and Master Records for more details.
5. For Expense Claim payments, use the same process as for normal Creditors, such as Payment by Bank Transfer, Cheque from any of the Bank Accounts including the Petty Cash A/C.

See:

Sales Batch Invoices Credit Notes (3.4) - AIQ Academy

Each Employee with a company card should prepare and submit Expense Reports and Receipts. Account for employee credit card expenses by recording them together with their scanned documentation. Include VAT and GL Codes which do not appear on Credit Card Statements or Bank Statements in the case of Debit Cards. 

Sundry Bank Payments for Credit Cards Expenses

See Creating Sundry Bank Payments for more details.

1. Go to Bank > Bank Accounts.
   
2. Under Actions, select Sundry Payment.
3. In Sundry Bank Payments, note the following:
   • GL A/C, Tax Code: Record each expense against the appropriate codes as frequently as possible to ensure greater accuracy.
   • Net, Gross Amt:  If you enter the Gross Amt, the system will request the Tax Code followed by the Gross Amt of the expense receipt and will calculate the Net and Tax. If you enter the Net Amount before the Tax and Tax Code, the rest will update.
4. Click Process Batch when finished.

Bank Transfers for Credit Cards Expenses

When the Credit Card Statement arrives, either scan it or use the Bank Reconciliation Program to record the expenditure, item by item, against the Bank GL Code. 

To record payment to the Credit Card Company as a Bank Transfer from one of the regular Bank Accounts:

1. Go to Bank > Bank Accounts and find the credit card bank account. The Balance on this Account represents the amount outstanding to the Credit Card Company unless you decide to remit the full amount to the Credit Card Company. 
2. Under Actions, select Bank Transfer and create a Bank Transfer. Accompany the record with a real Bank Transfer with the same details. This payment will appear in the remitting Bank Account for reconciliation purposes. The Credit Card Company will have already converted Foreign Currency purchases into your Base Currency, so you only need to process the transactions in Base Currency.
3. In Bank List, attach a scanned image of the Credit Card Statement. 
4. Click View Transactions to open the Transaction Browser and attach individual VAT Invoices and Receipts submitted with the claim.

Debit Card Expenses

Follow the same procedure as with Credit Cards (see above). The exception is that there is no need to set up a new Bank Account since the expenditure will be recorded by the issuing bank every time the Debit Card is used.

Employees should still record and submit their Expense Reports against the Bank Account GL Code attached to the Debit Card issuing bank. There is no need for a Bank Transfer to clear the expenses. Just perform regular Bank Reconciliations. See Manual Bank Reconciliation or Automated Bank Reconciliation.

See:

Bank Reconciliation (Manual) (6A.6) - AIQ Academy 

Bank Feeds (6B.1) - AIQ Academy 

Importing bank statements manually (6B.2) - AIQ Academy

Transaction Matching and Quick Post (6B.3) - AIQ Academy 

Advanced Posting and Matching (6B.4) - AIQ Academy 


Managing Company Bank Accounts and Credit Cards‍ 

Using Bank Statement Files (AutoRec)‍ 

Manual Bank Reconciliation‍ 

Automated Bank Reconciliation‍ 

Sales Batch Invoicing for Personal Purchases

If the Employee has used the Credit Card or Debit Card to purchase an item for personal purposes, then you need to recover such expenditure as the Supplier has been paid. It cannot be reversed in the system as this will cause errors in the Bank/Credit Card reconciliation process. Therefore, you need to correct the General Ledger Cost Accounts and Tax Accounts:

1. Set up the employee as a Debtor in the Sales system. 
2. Raise a Batch Invoice against the Debtor’s Account, quoting the original General Ledger Cost Account and the Net and Tax Amounts. The result is that the General Ledger Cost and Tax have now effectively been reversed and transferred to the Employee Debtor Account. 

Sometimes Directors or other Senior Employees will purchase a large ticket item (or Stock) for the company and settle it from their own funds. The Supplier may be an existing one or may need to be set up. To account for the employee's payment to the supplier, there are two options.

Option One

1. Set up the Director or Employee as an Internal Bank Account and pay them through this. See Using Supplier Payments - Quick Entry for more details. For accuracy’s sake keep the date of this Payment the same as the Purchase Invoice. 
2. Reimburse and clear the Director’s Bank Account with a Bank Transfer from the normal disbursements Bank account.
3. Enter the details of the Purchase Invoice, either through Batch Invoicing or, in the case of Stock Purchases, through Item Invoicing. 

Option Two

1. Set up the Employee’s Expense Accounts as a Creditor in the Purchasing System. 
2. Raise a Purchase Debit Note against the Supplier Account to clear the Invoice and to raise a Purchase Credit Note on the Employee's Expense Account in the Purchase Ledger. This transfers the debt transaction from the Supplier to the Director for subsequent reimbursement by the Company.
3. Enter the details of the Purchase Invoice, either through Batch Invoicing or, in the case of Stock Purchases, through Item Invoicing. 

See:

Supplier Payment - Quick Entry (4.8) - AIQ Academy

Purchase Batch Invoice (4.4) - AIQ Academy

Purchase Item Invoice (4.2) - AIQ Academy

The standard set of General Ledger Account Codes supplied with the System include General Ledger Accounts for Directors Loans. A more comprehensive way of dealing with Director's Loans, Expenses, and Advances is to set them up in the Purchase System as individual Suppliers. Then either:

• Process their Expenses and Credit Cards as detailed previously. Directors may choose to leave the out-of-pocket expense amounts on their Expense Account for some time.
• Use a Purchase Payment to the Directors Expense (Supplier) Account. In many cases, you can use these Advances to offset previously or currently incurred expenses.

Foreign Currency Advances

In the case of Cash Advances for journeys to Foreign Currency zones, also: 

1. Set up a Director’s Foreign Currency Expense (Supplier) Account for that Currency. 
2. Enter expense claims (typically non-Credit Card items such as taxis, and tips) from the trip and any subsequent returns of any remaining Cash Advance funds. 

See:

Foreign Currency Overview (8.0) - AIQ Academy  
 

Managing Multiple Currencies‍ 

For the cash purchase of small items such as Tea, Milk, Newspapers, Taxis & Couriers:

1. Set up a small Cash Box (Petty Cash Account) as a Bank account in the Cash & Bank system.
2. Use Sundry Payments for expenditure and a Bank Transfer to top up.