How to Pay Employee Expenses by EFT (Part 1)

Why Pay Employee Expenses as an EFT (Electronic Funds Transfer)?

1) Ensure Employees receive their expense reimbursements in a timely manner
2) Save time not printing checks / getting checks signed / stuffing envelopes / mailing payments
3) Automatically Email EFT Remittances to Employees

Steps to Setup the Company Side of the EFT Transaction

Setup Company EFT Information (You will need to work with your Bank for the file layout specifications and preferred transmission method)
1) Go To Financial >> Cards >> CheckBook
2) Select the Appropriate CheckBook
3) Make sure the Checkbook has a Company ID and Bank ID
4) Click on EFT Bank to enter the Bank Information

Enter the Following Information:
1) Bank Country / Region – from the Drop Down Select United States
2) Transit Routing Number / Bank Account Number
3) Tax Registration Number (your company’s FEIN)
4) Bank Identification Number (Name of Bank)
5) Bank Company Name (Company Name)
6) Company ID Number (The Company FEIN with an additional digit in front – such as 5)
7) Small Company Name (Auto-populates when entering the Bank Company ID)
8) Service Class Code (Auto-populated when selecting Bank Country/Region as the United States)
9) Bank Branch (leave blank unless told by Bank what information to put in this field)
10) Bank Code (this is the fractional code of the bank – 65-270/550)
11) Blocking Factor (Auto-populates when selecting Bank Country/Region – United States) (Do not change this unless instructed by Bank)
12) Format Code – (Auto-populates when selecting Bank Country/Region – United States) (Do not change this unless instructed by Bank)
13) Priority Code – (Auto-populates when selecting Bank Country/Region – United States) (Do not change this unless instructed by Bank)
Click Payable Option Button
This Opens the Checkbook EFT Payables Options Window
1) In the EFT Payment Number Section – The Next EFT Payment Number is Auto-Populated
2) In the File Format Section – Select Single Format and Click the Blue Expansion Arrow
3) This Opens the EFT File Format Maintenance Window

1) EFT Format ID – Give This Format a Name – for example, WELLS FARGO EFT
2) Description – Give This Format a Description – for example WELLS FARGO EMPLOYEE EXPENSE
3) Format Type – Select from Drop-Down – Your Bank should be able to tell you which file format to use. For this example – use US-NACHA-CCD. NACHA stands for National Automated Clearing Format House Association. CCD is a code that stands for Documents Signed by a Company. Once a Format Type is chosen, the rest of the fields are auto-populated.
4) Format Class – Auto-Populated when Format Type is chosen.

Click Save to return to the Checkbook EFT Payables Options Window.

Under File Format – Select the File Format just created – WELLS FARGO EFT
Under the Default Output File Section:
1) Setup a Secure Shared Location where the generated EFT Files will be saved.
2) Payables Domestic Payments – click the file folder and browse to the location setup in the previous step.

You have now completed the first step in being able to pay employee expenses by EFT. The next steps that will be covered in Part Two are:
Setting up the Employee Banking Information
Entering the Employee Expenses
Paying the Employee Expenses
Generating the EFT File and Transmitting to the Bank.

Tricia Chase | Senior Business Software Consultant

As a Senior Business Consultant, Tricia has performed various roles for customers including conducting design sessions, integrating data, training GP and 3rd Party modules, troubleshooting data issues, and acting as an interim controller. Tricia has over 20 years of experience as an accountant and over 15 years of experience with Microsoft Dynamics GP usually working with the Accounting / Finance Teams or the HR / Payroll Teams.  Prior to KTL, Tricia worked for various partners and as an Independent Consultant.  She has worked with in various industries including Construction, Trucking, Health Care, and State Government.  Tricia holds a B.S. in Accounting from St. Mary of the Plains College in Dodge City, Kansas.

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