CH> Direct Deposits

Direct Deposits

 

 

Summary

 

The Clearing House module Direct Deposit process is used to create an export file of Payroll module employee direct deposits. The export file is sent to an ACH processing bank, which processes the ACH transactions, removing the deposit amounts from a bank of your organization and places the funds into the bank accounts of the employees.

 

Check with your processing bank about the format of the export file and/or obtain a copy of ACH RULES: A complete Guide to Rules & Regulations Governing the ACH Network, published by the National Automated Clearing House Association (NACHA: http://www.nacha.org/).

 

In order to process a Direct Deposit batch, the direct deposits must first be created in the Payroll module using either the Computer Checks (PR> Computer Checks) or Manual Checks (PR> Manual Checks) process. Click here for information on the Direct Deposit Overview

 


Create the direct deposit transactions

 

When a Payroll module Computer Checks or Manual Checks batch contains a direct deposit transaction, the CH Batch field on the Commit step is enabled (PR> Computer Checks or Manual Checks> Commit> CH Batch field). The CH Batch field is used to select the Clearing House module Direct Deposits batch where the transactions will be processed. Once the Commit step is complete, the direct deposit transactions in the Payroll module batch will be placed in the selected Direct Deposits batch.

 

Once the transactions are in the Direct Deposits batch, move through the steps in the process to generate the file for your ACH processing bank and generate the journal entry to record the payment of the ACH transactions.


 

Pre-note

 

The Direct Deposit palette also has a feature that allows you to generate a pre-note batch of Payroll employees. A pre-note batch is a batch of zero dollar transactions used to verify that the bank account information of the employees is correct before a batch containing actual transactions is processed. Click here for information on creating a pre-note batch in Direct Deposits.

 


Manually create a direct deposit

 

ACH transactions generated using the Accounts Payable module are processed using the Electronic AP process (CH> Electronic AP). Click here for information on the Electronic AP process.

 


Step by Step

 

1     Open or create a new Direct Deposit batch. 

 

  • Open the Direct Deposit window (CH> Direct Deposit). The Batches window will display all the open Direct Deposit batches.
  • Click here for information on Batch Processing.
  • Select a batch and click DETAILS to open the selected batch.
  • Select a batch and click the Delete button to delete the selected batch.
  • Click the Create New Batch button to create a new batch. This will open the Create Batch window.
    • If there are open batches in the Direct Deposit process, you can create a new batch without affecting the open batches.
  • The Batch Month and Batch Year fields default to the current date and are for reference purposes only and do not determine the fiscal period and fiscal year that the journal entry created by the process is posted to.
    • The journal entry date entered on the GL Distribution step (CH> Direct Deposit> GL Distribution> Journal Entry field) determines the fiscal period and year that the journal entry is posted to.
  • Click CREATE to create the new Direct Deposit batch.

 

2     Open the Batch Overview page. 

 

  • The Batch Overview page provides a general overview of the selected batch.

  • The left navigation menu displays all the steps in the Direct Deposit process.

  • In the main section you'll see information about batch steps that are currently processing, next available batch steps, and the last completed batch step.

    • Batch steps that are currently processing will display a blue indicator bar to alert you that the step has not yet completed.

    • Once the preceding batch step is complete, the next available batch steps will be enabled and you can select the next step you would like to run.

      • While some batch steps are optional, any batch step that includes the Required tag must be completed before the batch is allowed to proceed through to the Commit step.

  • The Batch Outputs section on the right will display any reports or exports that have already been generated in the Direct Deposit process.

 

3     View or modify the direct deposits in the batch. 

 

  • Select Edit from the Direct Deposit menu. This will open the Edit Direct Deposit window.
  • The Edit Direct Deposits window will display all of the direct deposits in the batch.
  • Highlight a direct deposit and click DELETE to remove employee direct deposits from the batch.
  • Select a direct deposit to modify the information attached to a direct deposit (for example, the bank account number attached to a direct deposit transaction, or the direct deposit amount). This will open the Edit Direct Deposit section to the right.
  • The Edit Direct Deposit section is generally used to modify the direct deposit bank account number before the export file is created.
    • If the employee bank account information was entered incorrectly on the direct deposit deduction but the Computer Check or Manual Check has already been processed in the Payroll module, you can change the bank account number from this window before the export file is created and the direct deposit is processed.
      • If the bank account number was incorrect, you should also modify the bank account information on the direct deposit deduction on the employee so the bank account number will be correct the next time the direct deposit is created.
      • The bank account number of an employee direct deposit is entered into the Direct Deposit field on the Deductions tab of the Employee Maintenance window (PR> Maintenance> Employee> Deductions tab).
  • The Employee Number field displays the employee number of the employee. This field will only be enabled when you are manually creating a new direct deposit.
  • The Bank field is the employee bank and is attached to the Payroll deduction that was used to create the direct deposit.
    • In the Payroll module, a deduction has to be setup for each employee bank that will be used in the direct deposit process. A bank is attached to a direct deposit deduction using the Deduction/Benefit Maintenance window (PR> Maintenance> Deduction/Benefit> Open a direct deposit deduction> General tab> Select Bank in the Payee Type field> Select a bank in the Bank field).
  • The Amount field displays the amount of the direct deposit transaction.
    • If the Amount field is edited, a warning message will display when a user attempts to save the changes. This message informs users that any changes made to the Amount field will not be reflected in the Direct Deposit GL Distribution, which still uses the values from the committed PR batch.
  • The bank account selected in the City’s Account drop-down menu is the bank account that will be used to pay the direct deposit transactions.
    • Bank accounts are created and maintained using the Bank Account Maintenance window (SS> Maintenance> Bank Account). Click here for information on Bank Account Maintenance.
    • The GL cash account attached to this bank account will be credited by the journal entry created by the Direct Deposits process (SS> Maintenance> Bank Account> Cash Account field).
  • The Account Type drop-down menu is used to set up what type of bank account is selected in the Account Number drop-down menu. This will populate based on the bank account type set up on the Employee Maintenance window (PR> Maintenance> Employee> Deductions tab> Select a direct deposit deduction> Account Type field).
  • The Child Support Addendum section is used to add child support payment details to the ACH export. Some states require this information in order to track child support payment transactions. These are not required fields.
    • The Amount field is used to record the amount of the child support payment.
    • The Case ID field is used to record the child support case ID number.
    • The FIPS Code field is used to record the Federal Information Processing Standards location code that is associated with the payment.
    • Check the Medical Support toggle if the child support payment includes medical coverage for the beneficiary.
  • Click the Save button when complete to save the changes.

 

4     Print a proof list. 

 

  • The Proof List displays all of the direct deposit transactions in the batch. The Proof List displays the batch that created the direct deposit transactions, employee number, employee name, employee bank routing number, employee account number, and dollar amount.
  • Select Proof List from the Direct Deposits menu (CH> Direct Deposits> Proof List). This will open the Proof List window.
  • Once the required report settings have been specified, click the Print button to print your report.
  • Click the options arrow on the right side of the Print button to see other print options.
    • Select PDF to print the report in the default Springbrook format.
    • Select Excel to export the report data to an Excel spreadsheet as unformatted data.
    • Select Excel (Formatted) to export the report data to an Excel spreadsheet that includes much of the Springbrook formatting found on the printed version of the report.
  • Click the Schedule icon next to the Print button in order to schedule the report to generate at a later date and time.
    • Enter a Date and Time to generate the report and click SUBMIT.
  • Review and archive the Proof List.
  • The Source field displays the batch number of the Payroll module Computer Checks or Manual Checks batch that created the direct deposit transaction.
    • The batch number will be followed by a C if the transaction was created by a Computer Checks batch (PR> Computer Checks).
    • The batch number will be followed by an M if the transaction was created by a Manual Checks batch.
  • The Transfer/Route and Check Digit fields display the routing number of the direct deposit transaction. This number is pulled from the bank record that is attached to the direct deposit on the Deduction/Benefit Maintenance window (PR> Maintenance> Deduction/Benefit> Open a direct deposit deduction> General tab> Bank field).
    • Routing numbers are set up on bank records using the Bank Maintenance window (SS> Maintenance> Bank). Click here for information on bank maintenance.
    • The transfer and routing number should each be four digits long. The check digit should be one digit.
    • The Account Number field displays the bank account number that will receive the direct deposit.

 

5     Create the export file. 

 

  • The Export ACH File step will create a file to send to your processing bank that contains the bank account information of the customer accounts included in the batch.
  • Select Export ACH File from the Direct Deposit menu. This will open the Export ACH File window.
  • The options in the Export ACH file are intended to be used in conjunction with ACH RULES: A complete Guide to Rules & Regulations Governing the ACH Network, published by the National Automated Clearing House Association (NACHA). Your processing bank may also have information about what format they would like the ACH file submitted in.
  • The Export Options section is used to set up how the export file will be configured.
    • The fields referred to below that are in CAPITALS are fields that display in the export file.
  • The Tax ID Start Digit field is used to enter a tax ID digit before the Immediate Origin Info field. This will add the value in the field to line 1, position 14 of the export file.
    • The Immediate Origin Info field will generally display the Federal Tax Identification number set up in SS> Utilities> System Setup> Organization tab> Fed Tax ID field.
    • If there is a value entered in the Web Direct Information field, the value in the Tax ID Start Digit field will display before the web direct information number.
  • The ANSI ID field is used to enter the ANSI ID number, which is also referred to as the ANSI Identification Code Designator (ICD). The ANSI ID NUMBER is placed in front of the COMPANY IDENTIFICATION field on the export file. The value in this field will display on line 2, position 41 of the export file.
    • Leave the ANSI ID Number field blank if an ANSI ID number should not be included on the export file.
    • Standard Identification Code Designators are:
      • IRS Employer Identification Number (EIN): 1
      • Data Universal Numbering Systems (DUNS): 3
      • User Assigned Number: 9
    • The appropriate ANSI ID Number for most Springbrook customers is “1”.
    • The selection in this field affects: Record Type 8, position 45.  Record Type 5, position 41.
  • The Web Direct Info field will display on the first line of the export file in position 14 through 22. If you enter a value in the Web Direct Information field that is less than nine digits, the value will be padded with zeroes (For example, 99 will display as 000000099 on the export file).
    • Entering a value in the Web Direct Information field will replace the federal tax identification number that normally displays in this position. If the Use Routing Number for Immediate Origin toggle is checked, the value in that position will be the routing number in the Immediate Origin Code field.
    • If there is a value entered in the Start Digit field, the Web Direct Information number will shift one position over and will display in position 15 through 23 of the first line.
    • The federal tax identification number is entered in the System Setup window (SS> Utilities> System Setup> Organization tab> Federal Tax ID field).
  • Check the Generate with Zero Amounts toggle if you would like all transaction amounts in the file zeroed out. This option is generally used on pre-note batches to verify the bank account information of customer accounts before processing transactions on those accounts. All direct deposit amounts will be reported as 0, but no changes will be made to the Direct Debits batch. The direct deposit amounts will still display on the proof list and GL distribution report of the Direct Debits process.
    • The TRANSACTION CODE (positions 2-3) of record type 6 will be incremented by 1 if this option is checked.
    • The Default TRANSACTION CODE for Direct Deposits is 22 (Automated Deposit), pre-notification code is 23.
    • If a PPD Offset record is being created (Use Sweep Account toggle on the Export ACH File window is not checked and the Include Offset Record toggle is checked), the TRANSACTION CODE of the offset record will also be incremented by 1.
    • The selection of this toggle affects: Record Type 6, positions 2-3; Record Type 6, positions 30-39.
  • Check the Use Routing Number for Immediate Origin toggle to replace the Federal Tax ID number on the first line of the export file with the route, transfer and check digit of the Origin Bank.
    • If this toggle is checked, position 14 will have a blank space, and the route, transfer, and check digit will be placed in position 15 through 23.
    • If there is a value in the Web Direct Info field it will be overwritten on the export file by the route, transfer and check digit.
  • Check the Use Immediate Origin for Trace Number toggle to put the IMMEDIATE ORIGIN TRACE NUMBER position on the export file.
  • Check the Use Sweep Account toggle to set the ‘debit’ and ‘credit’ to zero.
    • The selection on this toggle affects: Record Type 8, positions 21-32; Record Type 9, positions 32-43.
  • Check the One Transaction Per Account toggle to combine export line items with the same bank account into a single line item.
    • Check this toggle if a single customer is regularly responsible for more than one UB or AR account. This will create a single debit on the customer's account rather than multiple debits for multiple UB or AR accounts.
    • By default, the same bank account information will display on two separate line items if the same bank account is used by more than one UB or AR customer account.
  • Check the Include Offset Record toggle to include an additional line in the file that contains the ‘credit’ sum of the file.
    • If the Use Sweep Account toggle is checked, no offset record will be created.
    • The selection on this toggle creates one additional Type 6 record after all regular Type 6 transaction records have been created. Amount field will contain a sum of all Record Type 6 amounts.
  • Check the Suppress Carriage Return/Line Feed toggle if you would like to remove carriage returns and line feed characters from the export file. The data will be stored in a single line on the output file if this option is selected.
    • The selection in this toggle will affect all records in the export file.
  • The Bank Information section is used to specify the details associated with the bank that will be receiving the exported ACH file.
  • The Destination Name field displays the name of the bank that is used to process the ACH transactions.
    • This field will display the bank name of the bank selected in the Immediate Destination Info field. This field will not be enabled.
    • The selection in this field affects: Record Type 1, positions 42-63.
  • The Immediate Destination Info field displays the routing number of the processing bank. The selection in this field will also affect the bank name that displays in the Destination Name field.
    • Click the Immediate Destination Info field search button to select the processing bank from a list.
  • The processing bank must be set up on the Bank Maintenance window (SS> Maintenance> Bank).
    • The field displays 10 characters and begins with a blank in the first position, followed by the four-digit Federal Reserve Routing Symbol, the four-digit ABA Institution Identifier, and the Check Digit.
    • The selection in this field affects: Record Type 1, positions 4-13; Record Type 5, positions 80-87; Record Type 6, positions 13-29.
  • The Origin Name field will display the bank description of the bank selected in the Immediate Origin Information field. The value in this field will populate on the export file if the Use Routing Number for Immediate Origin or the Use Immediate Origin for Trace Number toggle is checked.
    • The origin is the ACH operator or sending point that is sending the file.
    • The origin will appear on line one, position 64 through 86.
  • The Immediate Origin Info field will display the routing number of the sending point of the export file. This field will be included in the export file if the Use Routing Number for Immediate Origin toggle is checked.
    • The 10 digit field begins with a blank in the first position, followed by the four-digit Federal Reserve Routing Symbol, the four-digit ABA Institution Identifier, and the Check Digit.
    • The immediate origin code will display on the first line of the export file in position 14 through 23.
    • If there is a value in the Web Direct Info field, the value in that field will overwrite the Immediate Origin Code.
  • The Effective Date field is used to enter the effective date of the batch.  This field will default to two days from the current date because banks usually take two days to complete the file transfers.
    • The effect date will display on line 2, positions 70 through 75.
  • The Originator Status Code field is “1” for most Cirrus customers.  This code refers to the ODFI initiating entry. Currently assigned Originator Status Codes:
    • ADV file prepared by an ACH Operator: 0
    • Depository financial institution that has agreed to be bound by ACH rules: 1
    • Federal government entity or agency not subject to ACH rules: 2
    • The originator status will display on line 2, position 79.
  • The Login Information field is used to add text to the beginning of the export file.
    • The Login field can be up to 255 characters in length.
  • Click the Submit button when complete to generate the export file.
  • Once the export file has been created, send it to your processing bank. The method of transmission should be covered in the documentation provided by your processing bank.

 

6     Enter a journal entry date and create a GL Distribution Report. 

 

  • The GL Distribution step is used to print the GL Distribution Report, and select which fiscal period and fiscal year the journal entry generated in the process will be posted to.
  • Select GL Distribution on the Direct Deposit menu. This will open the GL Distribution window.
  • The Journal Entry field is used to enter the journal entry date of the journal entry generated by the process.
    • The Fiscal Period and Fiscal Year fields are not enabled but will populate based on the date entered in the Journal Entry field.
    • You will receive a validation error if the selected fiscal period and fiscal year have been locked using the Lockout Periods feature (GL> Utilities> Lockout Periods). Click here for information on the Lockout Periods feature.
  • Once the required report settings have been specified, click the Print button to print your report.
  • Click the options arrow on the right side of the Print button to see other print options.
    • Select PDF to print the report in the default Springbrook format.
    • Select Excel to export the report data to an Excel spreadsheet as unformatted data.
    • Select Excel (Formatted) to export the report data to an Excel spreadsheet that includes much of the Springbrook formatting found on the printed version of the report.
  • Click the Schedule icon next to the Print button in order to schedule the report to generate at a later date and time.
    • Enter a Date and Time to generate the report and click SUBMIT.

  • The Direct Deposit process will create the following journal entry:

     

    • Description

    Debit

    Credit

    GL Account attached to direct deposit deduction (PR> Maintenance> Deduction/Benefit> Open a deduction> Account tab> Default Credit Account section).

    XXX

     

    GL cash account attached to bank account setup to pay the direct deposit transactions (CH> Direct Deposits> Edit> Select a direct deposit> City’s Account field).

     

    XXX

 

7     Commit the batch. 

 

  • Select the Commit from the Direct Deposit menu. This will open the Commit window.
  • Click the Commit button to commit the batch.