Credit Card Reconciliation Made Simple

Transcription

1 Credit Card Reconciliation Made Simple (if that is possible) Rev 4/2015 BC Presented by: B.C. Worsley Payment Card Process Coordinator ,

2 Objectives A GL Only Activity Report that makes sense; Can I tic and tie and get there? Determine the real figure to reconcile to. What is the calculation that I use to reconcile? 2

3 Contents Where to start and why pg 4 Why reconcile and the purpose of a clearing project Reconciling a Revenue Project pg 5-7 Back to the Clearing Projects pg 8 Reports that you will need and tic and tie Merchant Connect and Settlement Detail pg 9 11 The merchant Statement in Merchant Connect pg 12 Discoverer GL Only Project Activity Detail pg Oracle Trial Balance or Account Analysis pg 15 Helpful Hints pg The Skinny on Disputes and Chargebacks pg What entries to make pg

4 Why reconcile and what do I reconcile? You are reconciling either a Clearing Project (see below) and/or a Revenue Project where payment card deposits were posted. You reconcile to make sure that all of your revenue has been posted correctly, (See Policy Reconciling Departmental Accounting Records and Procedure 1-5 Monthly Review of GL Project Activity and so you can locate and correct errors. If you use a third-party to collect registrations like Apply Yourself or Star Rez or Authorize.net, you may have to compare the data in MerchantConnect (our Processor s credit card reports), the GL (bank and department entries) against the records the third party has to make sure that they all match. What is the purpose of a Clearing Project? The credit card deposits from ALL merchant accounts are deposited into a single University bank account. They are coded with your merchant name and merchant number. Accounting Services takes those deposits and posts them (usually a credit entry) to a Clearing Project that is assigned to your specific merchant account, one for MasterCard, Visa and Discover and a second for AMEX. It is then the department s responsibility to (usually) debit the clearing project and credit the appropriate REVENUE projects where the money is to be posted. Once the department entry is made, the Project is cleared of any outstanding balance. The only balance that should EVER be outstanding in a Clearing Project are timing differences where all of the department entries have been made but the bank entries has lagged behind. See the example on page 18. 4

5 What if I only have one revenue project and all of my revenue is posted there? Then, the daily batch totals for MasterCard/Visa/Discover and American Express can be posted directly to your GL Revenue String. The object code in the GL string must be 4XXX. Reconciliation then transfers to the individual who currently reconciles the GL Revenue project. That individual will require access to MERCHANTCONNECT.com to retrieve the monthly credit card statement or to the Settlement Reports to use as the source document for the daily entries. See policies on page 4. The reconciliation process becomes matter of ticking and tying or checking off the daily totals to the bank entries. 5

6 This is the Settlement detail out of Merchant Connect. Paid by Mer. Services = MC/Visa/Discover and AMEX charges are listed under Paid by Others. This is the GL Revenue Project detail. You can see that all of the amounts reported from the credit card processor have been posted to the GL Revenue. The bank deposits lag behind the credit card settlement date by two to three days (see JE Name explanation). You have your source document, the detail matches the GL, check the amounts off on both documents and you are done. 6

7 The only issue may be that at the end of the month, a credit card deposit from the bank may not have posted so you have a timing difference. If that is the case, then you start the next month s reconciliation by checking off the last amount from the Settlement Detail on the MerchantConnect against what should be your first GL/JE line item posting in the new month. For specific instructions on Reconciling a Revenue project ask for Revenue Reconciliation for Credit Card Activity from the PCPC. For complete GL Reconciliation training, check out Training and Outreach s web site at The information on the page 9 and 10 will give you some additional insight into MerchantConnect and the Settlement Detail. The information on page 19 will illustrate what happens with AMEX deposits over the weekends. AMEX will consolidate the amounts and post a total to the bank account. 7

8 How do I reconcile a clearing project? Start with The transaction summary for the month from Elavon (using MerchantConnect.com Or, the monthly Statement from Elavon Discoverer -GL_Revenue Reconciliation Reports GL ONLY PROJECT ACTIVITY DETAIL for the month you are reconciling for each clearing project that Accounting Service is posting payment card deposits into. Oracle Trial Balance or Account Analysis (180 char) Use this to determine the project to date balance on each clearing project. Then, tic and tie (one method) the debits against the credits in the Clearing Project What is tic and tie? It is a simple way to indicate that both sides of a clearing project entry have been accounted for. E.g.. Check ( or tic) the debit entry and check off ( or tie to) the offsetting credit. Or for an expense on a PTAO or line item on a Revenue Project, that the entry you are showing in your project has the appropriate supporting documentation. You tic ( ) the entry to indicate that you have documentation to tie or support the entry. 8

9 Step 2 The expanded method will use the Settlement Detail in Merchant Connect to construct an EXCEL spreadsheet where you can list all of the data and do a side-by-side comparison. The Payment Card Process Coordinator will get you access. Download the batch information and amounts from Select: My Reports Select: Settlement and Batch Change the date range to what ever month you are reconciling. Your merchant number should be prepopulated. Select Ascending beside Settlement Date. Then click Search

10 Notes: Select Excel 97 option copy and paste to a permanent folder where you can record the reconciliations, To determine the Batch # double click the blue date (first and last) and add a column beside the date for the batch #, Paid by Mer.Service = MasterCard, Visa and Discover totals for a given day, Paid by other = AMEX, You can eliminate Total Settled. So you now know the range of the batches for both M/V/D and Amex. 10

11 Separate the Mc/Visa/Discover charges from the Amex Add a columns for the Bank post date, the Dept post date. You will still have to use the reconciliation calculation below (here) and on pages 17, 21 and 25 to calculate the Adjusted Balance in the project. Delete the Grand Totals at the bottom. GL Project Total Timing Differences Unposted Other errors Adjusted Project Total From the Clearing Project Usually bank entries Usually Department entries Anything unusual that posted to the clearing project Should be 0 Then, just as with the tic and tie method, you will check off the bank entries and check off the department entries with will leave you with just the unposted items and timing differences. 11

12 Equipment charges or charges for disputed items. On the PTAO Batch # AMEX daily totals M/V/D total daily deposit amount The statement contains the same information as the Transaction Summary plus other financial data that you may need to reconcile your PTAO (the expense account where the fees and disputed amounts are charged) and the credit card activity. If Accounting Services is posting the CC activity directly to your revenue, then use the statement. It has all of the information you will need and refer to specific instructions for Revenue Reconciliation for Credit Card Activity (available from the PCPC). 12

13 Step 2 Discoverer -GL_Revenue Reconciliation Reports This is a Discoverer Report GL Revenue Reconciliation Reports When you select the flashlight, use the arrows to move Oct 12 back to Displayed Values and the current month to Selected Values. Select GL-Only Project Activity Detail Delete the ORG and replace with %. This window pops up. Enter the Clearing Project number, E.g.. 980xxx. Click OK 13

14 Once the reports generates, print it out. Ignore the Project and Object total at the bottom as that is NET for the month only. You need the Project to date balance. The reason that you want to pull the GL Only Activity Detail is that it is policy. The practical reason is that the JE Line Description will help you to identify errors, M/A transactions and provide a clear description of the origin of the entry and make it is easier to tic and tie the debit entry to the offset credit in a clearing project. 14

15 Step 3 - Oracle Trial Balance or Account Analysis Run either the Oracle Trial Balance or What you are looking for is the Oracle - Account Analysis (180 Char) Ending Balance which is the Project to date balance. That is the figure that you balance to. 15

16 Now you have all of the Tools Match the batch numbers and amounts from the statement or Settlement and Batch information from Elavon against the GL report on the settlement sheet What sheet? What statement? Which GL Report? 16

17 After you have matched the debits to the credits, identified the errors and timing differences, you are ready to actually calculate the Reconciled Balance on the Clearing Project. We will look at this example a couple of times. Right now, we are looking at the calculation of the Adjusted Balance or the Reconciled Balance. You will get the Project to date balance from either the Trial Balance report or the Account Analysis in Oracle. To that balance you will add: Unposted department batch amounts The amount a department entry was short (less than) when compared to the bank entry. To that balance you will subtract: Unposted Timing Differences from the bank Department entries that were over (more than) the bank entries Duplicate posting of a batch by the department An unknown posting of an amount by the department. That calculation should get you to $

18 Some additional guidance on whether you add an item or subtract to determine the Adjusted Project balance. Project Total 10, Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff - 3, Unposted/timing diff - 4, Adjusted Project balance $0.00 Whatever the exception, it is added or subtracted depending on how the item will post to the clearing project. If the bank entered a chargeback (see pages 31-33) and the department has not yet made a entry, that would be a debit to the project and ultimately a debit to your revenue. A reverse chargeback is treated like a sale and the clearing project is debited and revenue credited. Look at the statement and then read the instructions on pages 31 thru 33. If the department posts a batch twice then the amount should be subtracted from the project and the second entry should be reversed (see GL Entries for Credit Card Transactions instructions for reversing a GL entry. 18

19 Normally, you will start with last month s GL report and tic and tie any timing differences off of the report for the current month. We are talking about these entries. The department entry for $2, and the bank entry for -$2, are ticked off of the August GL report. If the department does not make an entry for the $1, for Batch 951, it remains an unreconciled item that needs to be corrected! 19

20 Now we will look at the idiosyncrasies of an AMEX reconciliation. Amex posted weekend deposits as a single total. The weekend of July 4th and 5 th post as one total at the bank. The two following weekends, the 11 th and 12 th and 18 th and 19 th, there were not any transactions. However, the 25 th and 26 th there were transactions and they posted as one total by the bank, $ 2,

21 Now, let s look at a few other anomalies If you run the GL Project Activity Detail from the beginning of time to the current date, your Project to Date Balance is $6, The Org Total on the other hand is $ 6, The Object total problem will eventually need to be corrected. Call either Post-Audit, Debby Kessler or Imelda Carter in Accounting Services to assist you in finding and correcting the difference. You will usually find the offending entry at the beginning of the GL only Project if you run it from July to present. What else does the Project Total tell you??? It is a positive balance. The entries still outstanding to bring the Project to 0 have to be credits and should be just deposits outstanding from the bank. If the Project Total is a negative figure then usually there are outstanding batches to be posted by the department. 21

22 This is the calculated reconciliation for this project after the GL entries have been ticked off. Project to date Total 10, Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff - 3, Unposted/timing diff - 4, Adjusted Project balance $

23 Project Total 10, Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff Unposted/timing diff - 3, Unposted/timing diff - 4, Adjusted Project balance $0.00 When it is time to perform the June recon, you begin by ticking or checking off the outstanding items from the May reconciliation and then move to the June entries. One month leads to another. It is an ongoing process. 23

24 You no longer need to print out the monthly statement to access the batch data for the month. However, there is probably a Fiscal person in your area who will still require a copy of the first page as documentation of the fees and charges for the month. As reconciler, you may also want to note whether there are any Chargebacks or other adjustments that might interfere with the recon. You can also do away with the Reconciliation Excel Sheet if you use the tic and tie method using the figures on the GL Only Activity Detail. The Reconciliation calculation will still have to be performed regardless and the GL Only Activity needs to be signed by the reconciler and the approver. 24

25 Here is another example of the actual reconciliation. Take the Trail Balance or Account Analysis project to date total and make adjustments for timing differences to arrive at $0.00. There may be either unposted entries or some other error (transpositions or omissions) that need to be made to bring the Adjusted Total to $0.00. Clearing Project total (+ or -) Unposted (add dept entries subtract Central Office entries) Timing Difference (+ or -) Should be Minus (-) 2, Timing Difference -1, Unposted from the Bank Adjusted Total -.00 What do you do with the 2, unposted item from the Department??? The Adjusted Total = $0.00 but is the Project in balance? What amount would the Adjusted Total be if we had started with a Positive $750.00?? The unposted items ALWAYS NEED TO BE CORRECTED usually by the department. Timing differences will be cleared by either Central Office or the department the next month. 25

26 If you feel you have all the pieces to the puzzle then you are done. At least until next month when you start the process all over again. You begin where you left off with the prior month s settlement, record the posting of the timing differences and any errors then proceed to a new settlement sheet for the new month. However, if you are a little lost please continue for some helpful hints. 26

27 What If I Find an Error on the Account? Couldn t be me! Batch not posted to the Clearing Project by the department Review the information with the individual who is responsible for entering the data into Oracle. If the batch was overlooked, then make the Oracle entry to record the income. Bank/Central Office entry does not match the Batch Summary report off of a swipe machine Call Elavon C/S terminal support first at , opt 4 and ask why there is a discrepancy with the batch. Be prepared to provide the batch # and details of each transaction. Have your Merchant Account number ready. It may also be helpful if you are looking at the batch in Settled Transactions so that you can scroll through the amounts if necessary. Where did that amount come from? - Are there adjustments on the credit card statements that are for the same amount, a chargeback or equipment charge? Someone at Central Office has made an Adjustment or Reverse that you do not understand (ID IC6Z of JLM3F) - Call BC Worsley at

28 More hints How do you determine if the Central Office Bank Deposit has been made for each amount when there are several batches in succession for the same amount. You know your Department entries have been made because of the batch numbers. You look at the Settlement date for the batches before and after the series and check your calendar. 28

29 Batch before X $ Bank Deposit Date The batches for $1,362 posted on the 5 th, 6 th, 7 th and 9 th were deposited to the bank on the 7 th, 10 th, 12 th and the 12 th, in two Banking Days. The AMEX Batches entered on Saturday and Sunday behave just like any deposit you make at your bank on the weekends. They look like they were all made on Monday. It takes two Banking days to be deposited Batch after 29

30 Disputes and Chargebacks Elavon provides a really good overview of the dispute and chargeback process available at MerchantConnect.com under Support. You do not need to sign in to access this information. Check out all of the links! 30

31 Once you sign in, under the My Reports section, scroll down until you encounter The Chargebacks and Retrievals section. Pay attention to the Auto Fax Enrollment Form. Someone in your department should be signed up at all times and responding. AMEX disputes are routed through the PCPC. The chargeback contact in the department will receive an with details and will respond through the PCPC. 31

32 There are two sections on the monthly Elavon statement that alert you to chargebacks. As reconciler, you are likely the first to be aware that a chargeback or reverse has been entered by the CC companies. The person who is designated to respond to Disputes does not receive any notice that the claim has been denied or accepted so it is your job to let them know that an entry has been made and to provide the details on what entries need to be made in the GL. The first page under Summary And the last or next to last page just below the transaction Batch detail. If no one is signed up to received a FAX notification, then the dispute will be mailed to the department. When it doesn t get routed properly, then the first notice may be an unidentified debit on your clearing project. 32

33 The Chargeback section of Merchant Connect under My Reports provides a somewhat better picture of the detail. The amounts that posted to the GL are based on Action Date. In this example, there were 4 reversed chargeback on the 10 th and 2 on the 12 th. There were also two new chargebacks on the 13 th. The Financial Action (debit or credit) tells you what entry to make to your Revenue. On the 10 th the entry would be Debit Clearing Project and Credit your Revenue $ On the 12 th the entry would be Debit Clearing Project and Credit your Revenue $ On the 13 th the entry would be Debit Revenue and Credit your Clearing Project for a total of $3, All of these entries will NET to the Chargeback line on the Elavon monthly statement and the Grand Total, $2,

34 If you Need Help? Barbara A. Worsley (BC) (434) Elavon C/S Elavon Voice Auth Elavon Terminal Setup Imelda Carter (434) Accounting Services and GL Guru Do NOT call Judy McDaniel (jlm3f) as Judy simply posts the bank entries. She does not have ANY access to the data. 34