Prepayment Ledger

The Prepayment Ledger allows you to create and send payables to your accounting system before a transactional event (i.e. worksheet) has occurred within the system. 

An example of when to use prepayments is for supplier down payments.

How to Create a Supplier Prepayment

1. Navigate to the Prepayment Ledger (Accounting > Prepayment Ledger).
2. Click New Prepayment.
3. Select the appropriate Department and Supplier.
4. Enter the Supplier Invoice # (could be a proforma invoice # or some other form of reference #), Invoice Date and Payment Terms.
5. Enter the Amount.
6. Once you are finished, click Post.

You are done! Once the prepayment is posted, a bill is sent over to your accounting system. You can use this bill to record the outgoing payment to the supplier.

The prepayment will sit in the Prepayment Ledger on cieTrade, until you are ready to apply it to a Supplier Invoice. 

On the inquiry, you have the ability to view the total prepayment Amount, the amount Applied and the remaining Balance. You can also drill down on applied prepayments to view the corresponding worksheets.

How to Apply a Supplier Prepayment

Once you have received an Invoice from a Supplier:

1. Navigate to the AP Ledger (Accounting > AP Ledger).
2. Select the name of the Supplier, from which you have received an Invoice.
3. Select the Accrued Payable you will be applying the prepayment to.
4. Click Apply Prepayment.
5. Choose from the Supplier's prepayments, that have already been recorded in the Prepayment Ledger and choose how much of the prepayment you would like to apply.
6. Once you are finished, click Post.

You are done! Once the prepayment has been applied, the open AP is marked as posted in cieTrade AND a journal entry is posted to the accounting system which will Debit - AP Accrual, Credit - Prepayments.

NOTE - A Prepayment account must be setup in cieTrade and your accounting system. This will be classified as an "Other Current Liabilities/Prepaid Expense" account type the accounting system.

When will this affect my accounting software? We are using QBO as an example here. 

1. When you post a prepayment from the prepayment ledger, it will generate a bill in accounting

2. The Bill in accounting is used to record outgoing prepayment to the supplier

3. When you Apply prepayment to an open AP voucher in cieTrade on the AP ledger, the voucher will be marked as paid in cieTrade. In accounting, a journal entry will be generated (Debit AP Accrual, credit prepayments)

If you have additional questions, please contact the Support Team via email at support@cietrade.net.