Split employee Wages between EFT and cash component

I have an employee that would like a portion of their wages paid as cash and the balance paid directly into their bank account. Does anyone have a suggestion on how to process this to create an ABA file and account for the cash component?

Comments

Kris_Williams

I use Hosted and I can split between 3 different accounts in there. I guess you can choose a bank for the first one with relevant details and a ‘Cash” Bank for the 2nd one. Not sure about the version you are using, but I would look in the employee’s bank details section first, and I’m sure someone who uses this version will be more helpful

John Graetz

Christine. In the first instance I would be inclined to tell the employee that you do not want to make any payment by cash. If that doesn't work, then I would be treating the cash component as a deduction (Amount paid in cash) with that amount going into a special Liability Suspense Account, which you would then use to record the payment being made in cash. This differs a bit from what Kris has suggested as I feel that there would be a lack of a trail for the employee if it was being made by EFT into another bank account which did not belong to the employee.
John L G

Charley

Christine, agree with John, basically this guy wants you to go to the bank to get cash whereas he could draw it out himself. Just tell him that all wages are by EFT directly into his account, if he wants cash his problem.

Acctd4

Hi Christine

You can use a Clearing Bank account to achieve this:

If you don’t already have one set up, create a Bank-type account called “Clearing Acct”

Process the full net Pay in RA from the Clearing bank account

(This will leave the clearing account with a minus balance for the net wage amount)

Presumably, you will need to draw the cash out from your main bank account or take it out of Petty Cash (which you should also have set up in RA as a “Bank”-type account) so enter a Write Chq from the applicable bank account for the Cash Payment portion

(You can create a new “Other Name” called “Wages Clearing” or similar, as the Payee)

If you have drawn the cash out from the main bank account, you will need an additional Write Chq from here to your Cash/Petty Cash account

(I use a specific “Other Name” payee such as “Cash WDL”)

You now have the Cash amount sitting in your Cash/Petty Cash account & the full (negative) net Pay amount in your Clearing account

To offset these, simply enter a Write Chq out of the Cash account to the Clearing account for the Cash component & a 2nd Write Chq out of the main account to the Clearing account representing the EFT balance paid

Make sure you enter Memos (in both areas) on all transactions to reflect what each one is for

Shaz Hughes Dip(Fin) ACQ NSW, MICB

Reckon Accredited Professional Partner Bookkeeper / Registered BAS Agent (No: 92314 015)

Accounted 4 Bookkeeping Services

Ballajura, WA

0422 886 003

shazinoz2@bigpond.com

www.accounted4bs.com