Bank Deposit Books Canada
Annice
Here is the situation. My employer collect the tuition revenue, supplies revenue, after school revenue and registration fee...etc. from the parents, but he only gave the parents a hand writing receipt on a receipt book (including duplicate paper, one is for parent and he keeps another one). Then he will deposit all the cheques into the bank randomly without any record that shows how many cheque he deposit and any detail about the cheques. He deposited the cheques once he thinks the amount is large enough to be deposited, so the bank statement will show a lump sum amount for all the cheques that he deposit on the day he deposited. However, he did not have any record to show what cheques he deposited to the bank. The only resources I have are the receipt book and a excel spreadsheet that shows how many students we have now and what their fees are. Therefore, I know how much revenue do we earn from every students (from the excel spreadsheet), and I know when they made payments (from the receipt book, but it is going to be very time consuming to track for every students.)
here comes a question. Every parents paid on the different time and the amount is different for every parents because we have 2% discount if they paid in full and 3% discount if they have brothers or sisters. When I am doing bookkeeping for the school, I cant tell who made a payments to us based on the lump sum deposit amount from the bank statement. In our bank statement, we have too many deposits, so it is hard for me to track the payments based on receipt book. Especially, my employer asks me to separate the payments for every students. I can record all the payments separately from every student based on the receipt books, but the amount is not going to match the deposit amount on the bank statements because I dont have the detail of the deposits (there is no deposit book).
3) or Can I just record all the entries based on the deposit amounts on the bank statements? then make journal entry to separate the revenues. in this way, I am not able to separate the revenue to different students.
Create an account in the 1000 acct nbr called 'Cash/Chq Clearing' (you will need to class this as 'bank'). Then enter all the payments made for each student as per receipts into this new account using the date shown on the receipt - I'm guessing each receipt will have a student name. When entering the payment see if the receipt matches any of the revenue - if pmt is less than revenue see if the difference equals 2% or 3% discount. If not then enter the payments as a 'Deposit' for now (on the receipt journal you will see an icon that looks like a safe, when you hold your mouse over it will say 'enter deposit'.)
When you have done this then going by your bank stmt enter all the deposits made by a general journal entry and debit the bank account and credit the new acct 'Cash/Chq Clearing' - use the same date as the bank stmt shows for each deposit. Hopefully when you have done this you will be able to pull up your 'Cash/Chq Clearing' general ledger you can see a correlation between the receipts which are entered as debits and the bank deposit entries which are entered as credits.
Currently, our school's year end is Jun30th. Most of students paid their tuition and other fees before Jun 25th (which is before year end). When I start to work for this company, we are in the process of transitioning to simply accounting (the previous bookkeeper use QuickBooks). Therefore, I create a new company file in Sage 50 after I took over this job. Now I dont have the financial statements for 2014 year end (Jun 30th, 2014) because the accounting firm has not provided this information to us (he is too busy for filing personal tax). Therefore, I am not able to enter the opening balance now.
If I follow your suggestion, I have to enter all the Revenue as historical transactions which is ok. However, most of the students already made the tuition payments for the school year 2014-2015 that will start in Sep, 2014 before Jun 25th, 2014 (this is the due date of tuition, but I can see there are still many tuition payments later than this date.....). Therefore, I should assume most of student's tuition payments already have been recorded before the 2014 year end. Now Should I just enter the rest of the payments in simply accounting first? when I get the financial statement, I can then breakdown the deposits that the previous bookkeeper entered to different Revenue account??? (the previous bookkeeper has no experience in accounting. He is my employer's friend, and he used to work part-time for doing bookkeeping for the school.)
It is a little messy here. Your suggestions are pretty good, but I am not sure how to record transactions or payments because of the 2014 year end and historical transactions. I am a little bit confuse how to do it in the right way. Thank you for your help.
So it is my impression you will start at July1/14 as the current year end transactions to process. Leave the History as open so that you can enter the historical transactions later when you get the June30/14 year-end trial balance. Continue with posting any transactions dated July1/14 or later. If it is a payment for the tuition that is dated as July1/14 or later then enter those as 'deposits'.
You should have a list of students that are accepted into the 2014/2015 year so you can go ahead and create these as students in your Acct Receivable module. What is the date of the tuition invoices that was sent out for the 204/2015 year? If last year's date then it is part of historical transaction. If these invoices are dated July1/15 or later then you can go ahead and enter these invoices.
Sorry this line sounds confusing --> "unfortunately if I remember right you cannot enter 'deposits' (prepayments) using the receipt module in history mode - you will need to enter those as invoices with negative amounts." I meant when you are entering invoices/payments as historical transactions for the previous year. You can use Chq Nbr as invoice nbr - it is best to also use the wording ChqNbr prior to the number.
I am thinking that I will start doing what you thought me start from next year. The reason is my company does not give the parents any invoices. Our deposit include too many things like tuition, after school program, field trip,donation.....etc. It is almost impossible for me to track all these payments, especially there is no receipt for some of the payments. Last year's book was awful because the bookkeeper did not have a lot of accounting experience.
If I record all the deposit on the bank statement to School Revenue account, then breakdown the deposits based on what they have on the spreadsheet (I believe that we must have too much unknow payments sitting on our bank account). Will our company have any problem if later we are going to be audited? The payments for next school term is already start, so I want next year's book being very clear. That why I think I will have no time to figure out all the payments. I need to finish 2014-2015 bookkeeping as soon as possible now in order to be prepared for next year. Also, there are lots of mistakes that I need to correct now; for example, I believe that we claim too much CPP on 2013-now. The payroll clerk put the RRSP deduction amounts on the CPP box, so our employee and employer CPP is more than we should be paid.
You should do this the other way around - first record all deposits from Excel sheet as 'Paid Sales Invoice' which will credit your School Revenue account and debit your Cash Clearing account. Then look at your bank stmt and post each deposit showing on bank stmt as a credit to Cash Clearing account and a debit to Bank acct. As you have said there are no invoices sent out for Tuition etc so the receipts should be used as an invoice with pmt..
Your 2013 payroll will have already been filed with CRA and 2013 T4s done so you will not be able to change those. Same with the 2014 T4s. If RRSP were lumped into CPP amounts then you would have received a PIER report from Canada Revenue indicating the CPP overpayments and request for explanation.
In my opinion it is better to enter the invoice separately from the payment. The invoice date is rarely the same date as the payment is processed. If by chance they are the same date then yes you can do it in one entry. It should be important to keep your invoicing in the right time period (date) and the same for the payments.
You would not be classified a as cash basis company so yes you should invoice as pay later and use receipt module for payments. Generally you would invoice all students for the tuition as of one date and then accept payments as they come. You have indicated that there is early payment discount so obviously there is a certain date already set as the invoice date with the discount set within a certain number of days from the invoice date.
In some case what you could do is enter the invoice using the set invoice date WHEN you have received the payment. Example Invoice set date is July1/15 and payment from one student was Aug1/15 so when you received the Aug15/15 payment then go ahead and make up the invoice as a Pay Later for that student using the set invoice date of July1/15 and then post the payment using the receipt module dated Aug15/15. This is useful IF there are a lot of students who indicate they will renew for following year but end up NOT renewing their tuition and helps to eliminate having to post several credit invoices against the original invoices.
Ideally the invoice date for the following year's tuition should be set in the following fiscal year - not the current year as otherwise they become unearned revenue - meaning the revenue is not for the current year but rather for the following year. So all the payments that were made in the current fiscal year should be recorded as prepaid deposits - to do this first create a 2000 account nbr called 'Prepaid Tuition Deposit' then go into Setup--> Settings -> Receivables, then select Linked Accounts, and in the last box called 'Deposit and Prepaid Orders' enter the 2000 account nbr you just created.
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