Expense List Correction

Question

I recorded an Expense List that one of the employees submitted and wrote his cheque in October 2021. I have just realized that I made a mistake then by attaching a receipt that should not be included in the expense list. Now I have to adjust the Expense List by removing that receipt but I don't know how to correct the payment. Help needed. Thanks.

Richard S. Ridings · Accepted Answer

I would just reduce his next expense report by the same amount and record a description that includes the reasons why you are removing it. You can't go back and change reality. You gave him a cheque that includes it and he likely cashed that cheque. That' real. 
 If you post Purchase invoices with Pay Later, then you can record it now as a negative invoice so it shows on the A/P Aged report that the employee owes you money, and that will get included in the next cheque when you go to make the next payment from the Payments module. By doing it in two entries, the cheque stub will show the current expense report and the total the employee is expecting and the second entry will show as well as a reduction. If the employee doesn't remember, then he can ask you about it and you can use that source/invoice number of that entry on the stub to go back to the entry and see your notes.

Richard S. Ridings · Answer

Gulen said: cheque payment, not with Pay Later, so I think it's better to deduct the amount from his next expense list as you suggested. 
 That't technically irrelevant. The reality is that you cut a cheque for $XXX and it cashed and went through the bank as $XXX so how do you change the past? If you really can, you could sell it and make a lot money off regrets! 
 I assume then that Oct is last fiscal year and you have already finished your company year end and sent it to the accountant for tax preparation. In this case, yes I would just do the entry in 2022. 
 I am not an accountant and do not have all the information I would like to have in order to give you possibilities on tax-related issues, but if you understand accruals you could do an accrual for 2021 if you have not yet completed your year end and sent it to your tax accountant. 
 You could even post the negative Purchase invoice with Pay Later in Dec. You just have to remember to use Pay Later on the next expense report and then use Payments to record both invoices on the same cheque. I don't usually recommend changing procedures so I generally use the procedure that I won't have to change (I don't use the Make Other Payment option of the Payments module - I always use the Purchase Module). 
 If you do the accrual, you need to remember to go back and reverse it in the 2022 fiscal year. I would do both entries at the same time so you don't forget.

Sage 50 Canada

Expense List Correction

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