Changes to QBO Integration - Customer Payments
In the next 24 hours we will be releasing Minor Update 153 (for Update 242). This Minor Update contains some improvements around processing Customer Payments in Ostendo when integrating with QBO (QuickBooks Online)
These improvements relate to Customer Payments with Payment Rounding and Finance Charges. QBOs mechanism for receiving Customer Payments is quite different to that of other Accounting Software we integrate to, therefore this requires a slight change in setup in order to handle payments with Rounding and/or Charges.
Changes in Financial Entries When processing Customer Payments From Ostendo:
We will post the Customer Payment to a Bank Clearing account (rather than directly to the Bank account), Then we will generate a new jnl which would move the original amount received out of Bank Clearing and into the actual bank account. This would be done as a normal GL journal. The remaining amounts left in Bank Clearing would also be moved out of Bank Clearing into their respective Payment Rounding or Finance Charge accounts. Finally the invoice is applied from the Invoice Payment type journal.
Scenario:
Customer Pays $93 and we wish to record the following- Received amount $93 through the bank account
- $2 Rounding
- -$5 Finance Charge (already deducted by the bank from the deposited amount) (NB: A positive Finance Charge would be relevant where we are recovering a Finance Charge)
- $100 to be applied to the Invoice
A Customer Payment type journal created- DR $100 QBO Bank Clearing Account (new Cost Centre will be automatically created if it does not already exist. (Refer Below) This is mapped to a Clearing Account in QBO)
- CR $100 Unapplied Payments
An new Payment Clearing Journal created (received amount)- DR $93 Bank (from Cost Centre of Payment NB: This is the Actual Bank account recorded against the Payment)
- CR $93 QBO Bank Clearing Account
A Rounding Journal created- DR $2 Payment Rounding
- CR $2 QBO Bank Clearing Account
A Finance Charge Journal created- DR $5 Finance Charge (Bank Fees)
- CR $5 QBO Bank Clearing Account
An Invoice Payment Journal created (application of the payment)- DR $100 Unapplied Payments
- CR $100 Debtors
Therefore in this scenario we will end up with
DR to Bank of $93
DR to Payment Rounding of $2
DR to Bank Fees of $5
CR to Debtors of $100
Configuration Changes
Required Setup:
In order to allow for a smooth transition to these changes in QBO we suggest you implement the following changes at all QBO sites integrating with Ostendo- Setup a General Ledger Balance Sheet account in QBO called Ostendo Bank Clearing. NB: The balance in this account at any time will be Zero.
- Setup a new Cost Centre Code named #_BANKCLEARING_# ensuring the Cost Centre code is exactly named as shown in red. The Cost Centre Description can be called 'QBO Bank Clearing'
- Link the new Cost Centre #_BANKCLEARING_# to the QBO Bank Clearing account setup in Step 1
It should be noted, that if the new Cost Centre has not already been setup in advance, Ostendo will automatically create the #_BANKCLEARING_# Cost Centre, however no GL account will be linked. This will then lead to Failed Batches caused by the missing linked GL account.
Additional Validation relating to Ostendo Customer Payments when integrating to QBO:
Because QBO behaves differently to other Accounting Software around Customer Payments we have had to implement some restrictions within the Ostendo Customer Payments screen. These are as follows:- Received Amount, Payment Rounding and Charge Amount cannot be amended for payments where Invoices have already been applied.
- Overpayments of an invoice are not allowed in QBO (ie: where the Applied Amount for an invoice is greater than the Balance owing)
- A Credit note cannot be used to part-offset an invoice when processing a Payment. Apart from Payment Refunds, Credits must be off-set using a Match Credits to Invoices Style Payment.
The QBO Integration Document will be updated to reflect these changes in the next 24 hours:
http://www.ostendo.info/downloads/ostendo/OSTENDO_QBO_INTEGRATION.pdf |
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