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Accounts, Cashbook, Contras, Petty Cash & Credit Cards

Petty Cash

As far as your Durell system is concerned, Petty Cash is effectively a supplier that sells coffee, stamps and biscuits, etc, on credit, that you settle in fixed lumps of, say, £50 each, usually paid in advance.

To do this, first create a record in the Supplier address set with the search name “PETTY CASH”, as shown above. Then write out a real £50 cheque at the bank for “Cash”, and put the real money into your petty cash box. Ensure that you enter the equivalent details of this transaction in your computer’s Cashbook (i.e. via the “Starburst” or “New record” button – see “Accounts, Cashbook, Receipts & Payments”) as a payment of £50 to the supplier called “Petty Cash” on the date of the cheque, as illustrated below. Select the Cashing-up method “Cash-up now as individual item in bank”, because you will have already taken the money from the bank. However don’t try to reconcile it, because you won’t have spent any of it yet.

Then each time you use some petty cash ensure you get a paper receipt and enter the details of each one in the Purchase Ledger, like that shown below, where the Name will be “Petty Cash”, the Item/Policy number will describe the item and the Who/Policy holder will show the retail outlet (e.g. Name=Petty Cash, Item/Policy number=Stationery, Who/Policyholder=WH Smith). When you have run out of petty cash, repeat the above process to replenish your real life box with another £50 and add a matching entry in the Cashbook. Then re-find the last un-reconciled Petty Cash transaction, double-click it to switch to the flat view, then click the “Reconcile” button whereupon you’ll be presented with the Petty Cash account to be reconciled (see “Accounts, Cashbook, Reconciling (Insurer and Adviser Accounts, etc”).

Credit Cards

You should treat credit cards just like Petty Cash, described above. Each credit card should be entered separately in the Suppliers address set (e.g. as “VISA, WHITE R”, “VISA, BLOGGS F”, etc). Each credit card slip should be entered like an invoice in the Purchase Ledger. When you receive your credit card statement you should enter the overall settlement figure for each card separately in the Cashbook, then reconcile the relevant Purchase Ledger invoices against it.

Contra Entries

In the above example the AXA policy number 364384423487 has both an invoice for £316.20 and a matching credit for minus £316.20, probably because the client changed his mind at the last moment and decided not to take up the policy. In such a case Axa does not actually owe anything, yet the two contra entries are showing as still “Due” or outstanding. To resolve this include both of the transactions when next reconciling the Axa account, which will have no overall effect (i.e. 340 – 340 = 0) other than to “settle” them and stop their values appearing in the Purchase Ledger’s “Due” column. When reconciling such an account you are advised to select all the credits before the invoices, to prevent the overall balance going negative. For an example, see “Accounts, Cashbook, Reconciling (Insurer and Adviser Accounts, etc”.

Even if you’ve just got a single pair of matching contra entries, with no overall value, you can still clear them in the same way. Simply make a new Cashbook record to the Name in question for zero value, as shown below, then when you reconcile the account, ensure you select the credit/s first.