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Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / Reimbursed expense fro...
Microsoft Dynamics GP (Archived)

Reimbursed expense from vendor

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Posted on by Joseph Markovich 3,976

We have a pretty frequent occurrence where we will pay for an expense upfront and our parent company (vendor) reimburses us later.

It is things like internet expenses, phones, travel, meals.

Right now it is started with entering an AP invoice to the expense vendor and then cutting a check to them.  After that, we enter a debit memo in AR to our parent company and when we are reimbursed, we enter a cash receipt in AR.  I don't understand why some of this is getting put into AR.  Can't this all be done in AP?

Thank you in advance.

-Joe

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  • Community Member Profile Picture
    Community Member on at

    Hi Joseph,

    I don't believe this should be going through AP (certainly not the bit where you invoice your parent company).

    The transaction quantities will be the same no matter how you handle this - I.e you will have one invoice and payment to enter (the original vendor tranaction)...and one invoice and cash receipt to enter (the re-imbursement by your parent).

    Why do you think it should all be going through AP?

    Best regrds,

    Ian.

  • Joseph Markovich Profile Picture
    Joseph Markovich 3,976 on at

    Hi Ian-

    I thought this should all go through AP is because we are dealing with a vendor of ours.  We have a fake customer set up in RM for our vendor and because I don't know any better, it looks fishy to me.

    Is there some kind of practice in handling scenarios like this?

    Thank you.

    -Joe

  • Mike Smith Profile Picture
    Mike Smith 6,840 on at

    Joe,

    Do the parent company Vendor and Customer ever have balances in both A/P and A/R?

    There is a feature in GP to consolidate the accounts if this is an issue and then it is pretty clear that Customer X is tied to Vendor X in the system.

  • Community Member Profile Picture
    Community Member on at

    To answer the original question: I don't understand why some of this is getting put into AR.  Can't this all be done in AP?   The reason that AR is required is because of the cash receipt, you can't do that in AP.

    You are probably doing it the best way you can.   The Customer/Vendor function would really only work if the original AP invoice was left unpaid, then you entered a AR item, then did a consolidation.   The fact that you pay the original AP invoice does not really work with the Customer/Vendor function.   It is more of an I owe you, You owe me, let's net it out and either you cut me a check or I cut you a check.

    Warren.

  • Mike Smith Profile Picture
    Mike Smith 6,840 on at

    Warren,

    The Customer/Vendor consolidation is perfect for scenarios where a company has the same entity as both a Vendor and a Customer.  Under the reimbursement scenario with a different vendor, this obviously won't work.  But there must be some reason why the parent company is setup as a vendor.  If there is a scenario where your organization needs to pay the parent company for anything and carry an A/P balance while at the same time, carry an A/R balance with the parent company, the consolidation tools works great to get these balances on one side of the A/R A/P fence.

    This is but one option if this scenario exists and it may add some piece of mind as the system will link the two master records and provide system processes for consolidating (outside of entering the original A/R transaction to be paid by the parent company).

  • Community Member Profile Picture
    Community Member on at

    Mike, I agree 100% with what you say.  

    However in Joe's case there is not a open AP balance as they cut a check for the full AP amount.    There is no balance  for the Customer/Vendor tool to apply against in the AP subledger.   Of course, this is based on my reading Joe's initial write up correctly.

    The only other thing that I would suggest for consideration is to use the Misc Check feature in Bank Rec, that way they would not have to do anything in AP.    The AR Cash reciept could be done in Bank Rec also.  The linking would have to be done in the GL using some sort of a control account.

    Warren.

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