Accounting For Debit/Credit Card Payments On POS Terminal In Quickbooks Desktop.

POS terminal is a portable point of sale machine that allows payment through credit and debit cards on the go. Businesses use POS terminals as an alternative mode of payment for customers who are not comfortable carrying cash around.

Since the introduction of this point of sale machine, transactions value processed had since hit a height of N1.4tr, according to the 2017 data presented by Nigerian Inter-Bank Settlement System. Over 155,462 active POS terminals have already been made available to retailers or merchants in Nigeria.

The growing adoption of POS is a positive development which is not unconnected to the fact that Nigerians are now using less cash for transactions and more of POS as a preferred settlement method. A noticeable accounting and financial challenge is brewing from this payment method. Businesses that are not using point of sale software like QuickBooks POS software or other POS for making sales are finding it difficult to account for their actual bank balances in real time, due to delay in POS transactions settlement.

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For over 5 years, we have implemented QuickBooks for several companies under Retail, Manufacturing, Oil & Gas, Real Estate & Construction, Travels, Hospitality,Legal, Co-operatives, NGOs, Financial & Service Sectors.
  • Mbaire Services Nigeria Ltd(Construction)
  • Chisco Transport Limited(Transport)
  • Aristokrat 360 Limited(Creative & Media Agency)
  • Alpha Pharmacy (Health Care & Supermarket)
  • Olpharm Pharmacy (Health Care & Distributor)
  • Hawkes Legal(Legal)
  • Kantessa Limited(Fashion Store)
  • OPI Nigeria International Limited (Oil & Gas Servicing)
  • Zenilum Company Limited (Oil & Gas Servicing)
  • Lilygate Hotel(Hospitality)
  • Benstel Nigeria Limited(Bottle Water Production & Distribution)
  • Paraclete Nigeria Limited (Bottle Water Production & Distribution)
  • Josien Holdings Limited(Distribution)
  • Aisha Buhari Foundation (Futured Assured)(NGO)
  • Doheney HR Services(HR)
  • Biddel Oil & Gas Limited (Oil & Gas)
  • System Intelligenz Limited(Contractor)
  • MagTech Information Security (IT)
  • Infusion Cakes Nigeria (Bakery)
  • Landmark Centre (Event Centre)
  • Travel Options (Travels)
  • Logos Travel Support & Solutions Ltd (Travels)
  • Germaine Auto Centre (Autos)
  • Starlight Nigeria (Retail)
  • Temple Private School (Education)
  • Value Mart Supermarket (Retail)
  • Transweb Bureau De Change (Financial Service)
  • Vektro Food Limited (Manufacturing & Retails)
  • Orient Petroleum PLC (Oil & Gas)
  • Plus More

If you are currently using QuickBooks Pro, Premier or Enterprise Edition, and you accepts payment via POS terminal, this guide will help you find a better path to tracking all POS transactions in your accounting software.

Normally, it takes 2-3 days for banks to credit merchants account for the value of POS transactions carried out in stores or in their various business locations. Account officers or cashiers from their end do make the mistake of recording customers’ payment as cash received into the bank resulting in the increase of QuickBooks bank balances without immediate corresponding increase in the actual balance.

Here is an issue we recently resolved in one of the fast-growing hotels in Lagos:

A customer booked a room for 3 days at NGN 24,500 and paid NGN 73,500 via his debit card using the POS terminal. The payment was debited from the guest’s bank account but was not credited instantly to the merchants’ account. The cashier recorded the transaction as cash received which was saved directly to Zenith bank.

In QuickBooks, the Zenith bank balance increased as a result of the payment made by the customer, but the actual balances as shown on their internet banking portal remained the same; payments like these require them to wait for 2-3 days before the cash is cleared.

Such delayed inflow creates an imbalance between their bank account and QuickBooks figure which makes reconciliation quite difficult.

Our Expert Advice:

We recommended a separate account head under “Chart of Account>Bank” tagged “Zenith POS Payments“. This account served as a receiving bank for all POS transactions for the day which they could also use to track all the value of POS payment processed on a daily, weekly, monthly or annual basis.

On their financial report, their Zenith bank balances in QuickBooks were not affected by POS payments. The moment the bank credited all POS transactions into their account, the “transfer fund” window in QuickBooks will be launched to move all cash received from “Zenith POS Payment“, to “Zenith bank” in QuickBooks, while POS charges are written off to the “Bank Service Charge” account.

The idea is to separate all POS payment from the actual cash payment. Until the POS transactions are credited to your business account, you are not supposed to treat them as actual cash received, to avoid overstating your bank balances. Therefore, it is best to create a settlement bank account tagged “(Your Bank Name) POS Payment“.

That is all for now. If you have issues tracking your POS transactions in your book or would like us to implement QuickBooks, please click here to ask your questions or connect with us at info@accountingsoftware.com.ng or 08105090001.

Our team is waiting to support you!

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