Step-by-Step: Recording and Reconciling Deposits/Payments to Trust

Author: Sanjeev Chib

Managing your trust bank account can be complex, especially with such large volumes of invoices to keep track of. Which is what makes the Merang TravelOffice such a useful tool for travel companies as it keeps track of and helps you control the cash flowing into and out of trust.

Setting up and using a Trust Bank Account for your business is always a good idea (even if it is not required in your area). The Trust Bank Account will ensure that there is always money available to pay-off suppliers from the cash received from customer sales, and only the difference (i.e. commission) is transferrable to a “General” Bank Account to pay you overheads (i.e. rent, advertising, payroll) etc.

Many of our users have been asking us to provide them with some step-by-step guidelines on what to do with customer deposits and supplier payments. So, below is our step-by-step guide on how to record and reconcile customer deposits and supplier payments using the Merang TravelOffice system. Remember, not all steps need to be performed daily; the reconciliations can be done monthly, quarterly, or annually.

So here goes:

A. Customer Deposits Received:

1. Deposit: When you receive cash from the customer, deposit the cash in your trust bank account (within 3 days per TICO), and make a note of this deposit in your deposit book you obtained from the bank. In your deposit book, record the date you deposited it, the invoice number (from the merang system) and the amount, so that you can later reconcile it.

2. Record: In the merang system, go to the second page of the invoice (“Customer Fare Received” tab), and click on “Add Payment”. Select the method of payment (e.g. cash/cheque), the date the money was received, the amount, and who it was received from.

[Note: If the invoice is already marked as "Complete" or "Accounting", then you can record the amount recieved by logging into the back-office, click on "Accounts Receivable-Customer" (gives a list of invoices for which amounts are still receivable from customers), and record the amount received here.]

3. Reconcile: On a monthly, quarterly, or annual (you decide) basis , you need to reconcile (i.e. match) what is recorded in the merang system to what was deposited in the trust bank account. To do this, simply login to the back-office, click on “Accounts Receivable-Customers”, and then from the left-side menu, click on “Reconcile Cash Receipts”. This will give you a list of all amounts that you had recorded as received from customers, that you need to reconcile to your deposit book/bank statement.

Match the invoice number & amount from merang to what is listed in the deposit book and the bank statement – click on “Reconcile” and record the date the amount was deposited into the trust bank account.

B. Payments Made to Suppliers:

1. Pay and Record: When you pay the supplier, go to the last page of the invoice (“Supplier Payments” tab), and click on “Add Payment”. Select the method of payment (e.g. cash/cheque, or company credit card), the cheque number (if any), date the money was paid, and the amount.

[Note: If the invoice is already marked as "Complete" or "Accounting", then you can record the amount paid by logging into the back-office, click on "Accounts Payable-Supplier" (gives a list of invoices for which payment is due to suppliers), and record the amount paid here.]

2. Reconcile: On a monthly, quarterly, or annual (you decide) basis, you need to reconcile (i.e. match) what is recorded in the merang system to what was paid from the trust bank account. To do this:

a. If amount was paid to supplier by cheque/cash/draft:
Simply login to the back-office, click on “Accounts Payable-Supplier”, and then from the left-side menu, click on “Reconcile Payments”. This will give you a list of all amounts that you had recorded as paid to suppliers, that you need to reconcile to your bank statement.

Match the invoice number & amount from merang to what is listed in your cheque stubs and bank statement – click on “Reconcile” and record the date the amount was withdrawn from the trust bank account (based on the bank statement).

b. If amount was paid to supplier by Credit Card:
Simply login to the back-office, click on “Accounts Payable-Company Credit Card”. This will give you a list of all amounts that you had recorded as paid to suppliers by credit card, that you need to reconcile to your credit card and bank statements.

Match the invoice number & amount from merang to what is listed in your credit card statement, and bank statement – click on “Reconcile” and record the date the amount was withdrawn from the trust bank account to pay the credit card statement.

C. Transferring Commission Amounts from Trust to General Accounts:

Only once the above steps A and B are completed (including reconciling), then you can transfer the amounts from the trust to the general account. To do this, log into the back-office, and click on “Cash – Trust Account”. This will give you a list of all invoices that have been fully reconciled (both the deposit side and the payment side) and the amounts that you can transfer to the general account. Once you have transferred the cash from trust bank account to your general bank account, you can record them as transferred here so that you don’t end up transferring them again.

Simple 10 Step Process to Creating an Invoice

Author: Team Merang

Although our user guides provide details on creating invoices, we’ve found that many of our travel business users don’t have a lot of time to go through the guides, and need a quick short-cut way to create the invoices (especially when training new staff), to get them started quickly.

So here goes. We’ve put together a simple 10 step process to creating an invoice. We hope this will help you and your staff create invoices quickly:

1. Login to the invoicing module.
 
2. Click on the “Create a New Customer Invoice” button. This will open a blank invoice screen.
 
3. Enter the departure date and return date. Then, enter the customer details (first name, last name, address and phone number) and click on the “Create” button. This will save the customer profile into the customer database and you will get a confirmation window. Close it. (Note: If the customer is an existing customer, do a search to pull up the customer record)
 
4. Next, scroll to the bottom of the invoice and click on “Save Invoice”. This will generate a new invoice number and save all the details to the new invoice.
 
5. Click on “Add Travel Product” in the itinerary details section, and the Travel Products window opens. You must select the supplier here (and if it does not appear on the list, click on the + icon and add it; @agents: you may need to ask your manager to do this). Click on Save Product. Then complete the “Customer Fare” and “Supplier Net Cost” pages. (You must click on the “Calculate Totals” or “Calculate Net Cost” buttons respectively on these pages). Click on the save button in each page to save the information. Close the window when complete.
 
6. Complete the remainder of the information in this first page of the invoice and click on the “Save invoice” button.
 
7. Click on the “Customer Fare Received” tab on the top of the invoice to go to the second page. Click on “Add Payment” to record the customer payment received.
 
8. The “Supplier Net Cost” tab (third page of invoice) is for information purposes. Click on the “Supplier Payments” tab on the top of the invoice to go to the fourth page of the invoice. Click on “Add Payment” to record how you paid the supplier.
 
9. To e-mail the invoice, click on “E-mail – Customer”. A box opens and you can enter the customer’s e-mail, and your e-mail to get a copy. Click on the “E-mail Invoice” button to send the invoice. To print the invoice, click on “Print Invoice” which opens the invoice as a MS Word document.
 
10. Finally, click on the “Booking Details” tab to return to the first page of the invoice. Change the status to “Complete” and click on “Save Invoice” to save it.

Changing or Updating Information on Invoices:

Author: Team Merang

Some users have asked about how to change or update information on the invoices. This would depend on the status of the invoices, as summarized below:

1. For invoices in “Pending” or “Review” status: 
As these invoices have not yet been transferred to the back-office module, you can edit them directly, without any impact to the back-office accounting:

• Login to the invoice module, search for the invoice and click ‘edit’ to make changes to the invoice.
• To make changes to the products or insurance items, once the invoice opens (under the first ‘Booking Details’ tab), scroll down to where the “product” and “insurance” section. You can click on ‘edit’ besides any product or insurance item, which will open the product or insurance window. Make the changes/upgrades to the product or insurance item, including the customer fare or supplier net cost information, and click on the “Save Product” or “Save Insurance” button.
• Remember to always click on “Save Invoice” when making changes.

2. For invoices in “Complete” status:
Although these invoices are “complete” you can change the status back to “pending” or “review” and then follow the steps in (1) above. To change the invoice status:

• Login to the invoice module, search for the invoice and click ‘edit’.
• Once the invoice opens, you will notice that it is in a read-only format, except for the Invoice Status field (a drop-down field), which you can change.
• Change the status to either “pending” or “review”, and click the “Save Invoice” button.
• After the status is changed, follow the steps in (1) above to change or update information in the invoice.

 3. For invoices in “Accounting” status:
As these invoices are now in the back-office accounting stage, no changes are permitted from the invoice module (to preserve the integrity of the invoices). However, you can still make any edits/updates to these invoices, but only through the back-office module. To do this:

• Login to the back-office module (you must be assigned a user role of “Administrator” or “Accountant” to do this. For agents, please check with the office “Administrator” or “Accountant” to make this change).
• Once logged into the back-office module, click on “Invoice Management from the left-side menu.
• Search for the invoice and click on ‘edit’ to edit the invoice.
• Make changes, as normal, to the invoice.

(Please note: if you need to record a refunded amount to these invoices, you can add a payment, and put a negative (“-”) sign before the amount to record the amount refunded).

If you have any specific questions about a certain invoice, do drop us a note and we will walk you through it.