8.0. Funds Transfer between Banks

Funds Transfer between Banks

STEPS:

1. Click PURCHASES activity
2. Click PAYMENT module
3. Click NEW
4. DATE select 10 Jan 2012
5. PAYEE TYPE select Bank
6. PAYEE enter Your Company Name
7. MODE select UOB Bank
   
8. For Mode, note that this will be the where the funds will be deducted from.
   
9. Details
   
10. ACCOUNT select Bank USD
    
11. DESCRIPTION enter Fund Transfer
    
12. RECEIVE AMOUNT enter 10 000 (USD)
    
13. PAYMENT AMOUNT enter 12 900 (SGD) The Account will the bank account where the funds will be deposited into.
    Receive Amount is the amount the bank physically received.
    Payment Amount is the actual amount the paying bank is deducted.
    Note that the transaction exchange rate has already been applied to the receive amount. Hence the exchange rate to be keyed in will be your book rate.
14. Click ADD
    

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Understanding the Double Entries & Exchange Difference

STEPS:

1. Click PURCHASES activity
2. Click PAYMENT module
3. Select the previously created payment
4. Click EDIT
5. Click GL
6. Line 1, UOB ACCOUNT
   Notice that SGD12,900 is withdrawn from the bank account.
7. Line 2, Bank
   USD10,000 or SGD12,880 is deposited in the account.
   Note that SGD12,880 is derived from the exchange rate entered at the payment
   voucher 1.288
8. Line 3, Exchange Gain/Loss
   From the transaction, you notice that SGD12,880 - SGD12,900 = -SGD20 value
   that is loss in exchange.
   For this amount, the system automatically accounts it at Exchange
   Gain or Loss Account.
9. Click PURCHASES activity
   
10. Click PAYMENT module
    
11. Click NEW
    
12. DATE enter 16 Jan 12
    
13. PAYEE select Interesting Supplier Pte Ltd
    
14. MODE select USD Bank
    
15. Click [O]
    Notice that USD bank is selected for mode.
16. DOCUMENT enter Deposit
    
17. Click OK
    For Exchange Rate, notice that the system exchange rate of 1.288
    appear as you have earlier setup for the period at the exchange table

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