Imprest is some of money advanced to particular Employee for specific purpose.
Following are the steps for managing imprest accounting and authorization in ERPNext.
Step 1: Setup Imprest Accounts
An accounting group should be created for imprest in the Chart of Account. Separate accounting ledger can be created for each employee as their imprest Account. Balance in the imprest account will indicate imprest given to Employee, for which he/she is yet to provide actual expense details.
Step 2: Imprest Approval
A Custom Field should be inserted in the Expense Claim form, so that one can differentiate if employee has made request for Imprest or Expense Claim. Also you can create separate naming series in Expense Claim. This will help you in differentiating Imprests and Claims request from the transaction id itself.
The standard Expense Claim approval design shall work for the Imprest authorizations as well. Click here to learn more about Expense Claim approval process.
Step 3: Accounting entry after Imprest is Approved
Accounting entry will be posted by creating new Journal Voucher. This entry will have employee’s imprest account debiting, and cash/bank account crediting.
Step 4: Accounting entry after Expense Claim is Approved
Expense Claim will is made based on actual expenses incurred by an employee. The accounting entry made after approval of Expense Claim will have expense accounts booked, based on expense details provided by Employee. And balance in the employee's imprest account will reduce, because he/she has provided details on how imprest money was spent.
Step 5: Adjustment Entry
If employee’s imprest account shows debit balance, even after Journal Voucher is posted for Expense Claim, that balance can be adjusted in his/her salary slip voucher. Or a separate Journal Voucher can be made if employee returns balance amount.
Conclusively, Expense Claim form will be used for the authorization of imprest and Expense Claim request of Employees. Accounting entries will be posted to track balance in the employee's imprest account.
Thanks to Mac and Robert for their inputs!
Umair is Frappe's co-founder, VP - Partnerships, and mentor for Frappe School team.