We use JP Morgan for purchase cards, and have issued about 30 to our department heads and administrators. They find it very helpful, and it avoids many last minute checks that we used to have to issue. We have access to all transactions on the website, and can download a file each month with the coded transactions which each cardholder has coded. This produces a journal entry which I import into Blackbaud Financial Edge. We require prior approval for all purchases and backup, and have no problems with unauthorized use.

We also have JP Morgan for our credit cards. Do you pay a fee for this service from JP Morgan? It would be helpful to know if you have to pay for this service. I currently set up a csv file of information from each credit card issued for travel and purchases and then import the file into the credit card vendor as a payable and then write a check to the credit card company and send the money via ACH.

BB will not let me enter the payable to the credit card vendor and post the debit to the created cash account. I get an error “ some gl accounts on this transaction cannot be used because they are defined as cash accounts for a bank” I created a new bank account and used the new gl account as indicated. How do I get around this issue?

In the APAY module, go to Configuration and then Business Rules. Under the general section for the option to allow non-bank transactions to use cash accounts you need to change it from never to always. I personally change it to key the invoice and then change it back.

Thanks for the info, Romy! This seems like a great way to do this! I had set up a separate payable account for credit cards, but then I had to remember to change it all the time because FE automatically drops in the default A/P account. Also, I wasn't able to enter the transactions by the actual vendor, I just entered them all under the credit card vendor, and therefore didn't have detail on each transaction (had to put it in Notes - too time consuming!). Just one question to clarify - did you set up your credit as a bank account (i.e. under Banks) and also as a GL asset account? (The same way you set up each regular bank account.) Thanks, Leanne

Yes - you have to if it is a bank account. This account should be zero at the end of the month, depending on the timing of your bank account cycle. Romy

For those organizations that don't track the individual vendor charges on the credit card, how do you track 1099 vendors? or is it not necessary (IRS guideline)?

You only track the vendors you pay directly. The credit card company does their own reporting.

We do not record credit card charges in each individual vendor. Therefore, we track those 1099 vendors using an Excel spreadsheet. The IRS procedures are outlines in IRB 2004-31 and Rev Proc 2004-43.

Hi Everyone, We have been paying vendors via credit cards for about a year now. We are currently using a very manual system of tracking these payment; however, our manual system makes it difficult to track vendor history. We've researched the procedures that you have been discussing and have one big question. How have your external auditors reacted to the use of a "bank account" that really does not represent a true account held at a bank? We are not quite comfortable with creating a "bank account" and the corresponding GL account that does not represent a true physical cash account. I'd love to hear from anyone who has been using this system for a while and discuss their perspective on this concern. Please feel free to call me at 512-476-1234 or e-mail me at [Email Removed]. Thanks, Karen

Thanks for the response Romy. I'm responding in the forum because my reply to your e-mail address kept getting bounced back to me. Financial Edge Accounts Payable would not let us link the "bank account" to a liability account. It gave us a message saying it had to be a cash account. How did you get around that problem? Did you set a "Cash Account" on the GL but then show it as a liability on your balance sheet? That seems a little strange, but could possibly be workable. We are a little hesitant to begin using this work around, but would like any information you have on the problems you may have encountered. Do you feel the procedures are very efficient? Seems like they would be in theory. Thanks again for your help.

See Above. [i]--- Edited at 11/1/2006 3:55:27 PM by Curtis Aubrey[/i]

Ellen, just for clarification, you keep all personalized employee credit cards locked up until employees need to use them? Or do you have blank or company cards that they check out? The reason I'm asking is that I am looking for a purchasing card solution that we could allow staff level and/or volunteers check out for occasional low-dollar purchases rather then issuing each employee a card (which we won't do).

Yes we keep most of the Employees personalized credit cards locked up for them to sign in and out. We do have some sites that are in a different city, and they are able to keep their credit card on them. All employees with a company credit card has to sign a paper stating that they have read the rules of the credit card. We also have the employees who carry their card sign for their card.

Annette, what program do you use with JP Morgan Chase? I looked up their card programs on the Web and talked to an associate there briefly, but it didn't sound like they had a way to code the transactions like you mention. Can you shed some light on this for me? Thanks!