Module 5 · Core · 8 min read

Cash, bank accounts and payment modes

You will be able to: Explain how cash and bank balances live in the ledger accounts; Set up a bank account record and link it to its ledger account; Describe how payment modes decide which account money goes to; Know what the Bank Account field on a voucher is for.

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Money in a business sits in ledger accounts: Cash in Hand (1000 in the standard chart) for notes and coins, and one or more bank accounts (1100 Bank, Current Account in the standard chart). Cash and bank balances are not separate from the books; they are the balances of these ledger accounts. Three things in Zeyto connect real-world money to those accounts: the Bank Accounts master, the Payment Modes and the vouchers.

The Bank Accounts screen listing each bank account with its linked general ledger account, currency and active status.

Accounting, Bank Accounts: each bank account is linked to a ledger.

Accounting, Bank Accounts: each bank account is linked to a ledger.

Bank Accounts master

Under Accounting, Bank Accounts, each record describes one real account at a bank: Code, Name, Bank, Bank Branch, Account No, IBAN, Currency and, most importantly, the GL Account, the ledger account it posts to. Zeyto does not validate the IBAN, so read it twice. Without a GL Account the bank account is not offered on Bank Entry and cannot be used for a post-dated cheque clearance. Saving a bank account posts nothing.

The Payment Modes settings listing cash, card, bank transfer and cheque modes with their kind, ledger account and behaviour tags.

Settings, Payment Modes: which ledger each way of paying posts to.

Settings, Payment Modes: which ledger each way of paying posts to.
  • Show on customer invoices and statements: tick it to print this account in the bank block of invoices, quotations and statements of account. It needs an Account No or IBAN and a Bank-type GL Account.
  • Print Order and Print Label control the order and caption when several accounts print.
  • There is no delete. Set the account to Inactive to stop offering it.

Payment modes

Under Settings, Payment Modes, each way of paying is tied to one ledger account. When a receipt, payment, sale or purchase is posted, Zeyto puts the money into the account of the mode used. Cash goes to the cash account, Bank Transfer to a bank account, and so on.

  • Kind: CASH, CARD, BANK, CHEQUE, COUPON, WALLET or OTHER. In the POS only a CASH mode gives change, and only CASH payments count toward the cash you expect in the drawer when a shift closes.
  • Requires reference no.: a payment in this mode must carry a reference such as a card slip, cheque or transfer number. The POS asks for it and a document is refused without it.
  • Code and Kind are fixed once saved. There is no delete; switch a mode off with Status.
  • On sales and purchase documents only CASH, CARD, BANK and CHEQUE kinds are offered.
Watch outIf your payment mode list has PDCIN and PDCOUT, leave them alone. Post-dated cheque vouchers use them.

The Bank Account field on a voucher

On a receipt, payment or advance, the Bank Account is only a tag so that Bank Reconciliation files the line under that account. The ledger debited or credited comes from the payment mode, not from the bank account you pick. So if you pick Bank Transfer but tag the wrong bank account, the ledger is still right but your reconciliation list will be wrong.

Setting up a second bank accountYour company opens a Dirham account at a new bank. In Accounting, Bank Accounts, press + New, type Code EBANK2 and a Name, fill in Bank, Account No and IBAN, keep Currency AED, and in GL Account type the name of a new ledger account and choose the create row to make a Bank-type ledger under Assets. Save. Then in Settings, Payment Modes, press + New Mode with Kind BANK and that GL Account, so that transfers received on that account post correctly.
TipKeep one GL account per real bank account. Mixing two banks in one ledger account makes reconciliation painful.

Try it in the demo

  1. Open demo.zeyto.app/demo-app/ and sign in with the public demo user (admin, password demoAdmin123).
  2. Open Accounting, Bank Accounts and look at the columns: GL, Currency and Active.
  3. Click a bank account and find GL Account and Linked GL balance.
  4. Open Settings, Payment Modes and read Kind, GL Account and the Behaviour tags (Drawer, Ref).
  5. Open Accounting, Chart of Accounts and find the Cash in Hand and Bank accounts.
Open the live demo

Public demo company, sign in as admin / demoAdmin123. Data refreshes nightly.

Key takeaways
  • Cash and bank balances are ledger account balances.
  • A bank account record must link to a GL account to be useful.
  • The payment mode decides which ledger account a payment hits.
  • The Bank Account field on a voucher is a reconciliation tag only.

Check yourself

3 questions on this lesson. Not timed, not the exam, and you can try again. Score 60% or more, and read the lesson, to complete it.

1. Which ledger account is Cash in Hand in the standard chart?

2. On a receipt voucher, the Bank Account you pick decides which ledger account is debited.

3. Which payment mode Kind gives change in the POS?

Previous: How stock ties to the general ledgerNext: Receipts and payments

Practice questions for this module · Printable study sheet