How to reconcile a payout from a payment processor when some transactions relate to a prior year

This support article covers what to do when reconciling a payout that includes transactions both within your current financial year and your prior financial year.

If both financial years are on ExpensePlus, then this isn't an issue, and you should reconcile the payout following the regular guidance (which we've linked below). However, if your prior financial year wasn't on ExpensePlus, then this article covers what you will need to do.


Before reading this support article, we recommend that you first read the general guidance on how to reconcile payouts from a payment processor:

If your payment processor isn't on this list click here.

How do I reconcile a payout when some transactions relate to a prior year that is not on ExpensePlus?

The answer to this question depends on how the balance in your payment processor account was accounted for in your year-end accounts for the prior year.

Top Tip: If you are not sure of the answer to this question, then it's best to check with the person creating your accounts because the way you reconcile the payout within ExpensePlus needs to be consistent with this, to ensure that the income is correctly accounted for.

We've laid out guidance for the two most common scenarios below. If neither of these are applicable to your organisation, please contact our support team for further advice.


Option 1: If the amount held within your payment processor account doesn't appear within your year-end accounts for the prior financial year (which will typically be the case)

Where this is the case, although the first payout from your payment processor in your new financial year may contain income relating to your prior financial year, all income in this payout should be accounted for in the current financial year (because it wasn't accounted for in your prior year).

If you are reconciling payouts using method 2 (reconciling the payout that appears on your bank statement as a 'payout from payment processor', then uploading the corresponding payout report), you will need to modify the payout report downloading from your payment processor before uploading this to ExpensePlus.

Within the downloaded payout report, you will need to find any transactions with dates in your prior financial year and update these to be dated as the first day of your new financial year. You can then upload the file as you usually would.

Important: Modifying the payout file is important, as ExpensePlus won't upload any transactions dated before the start date of the first financial year.

Modifying the payout report file isn't something you should usually do (this is ONLY for the very first payout from a payment processor where the income from the prior year wasn't accrued for in your prior year accounts and therefore needs to form part of your the accounts for your new financial year)

Option 2: You create accounts on an accruals basis, and you have accrued for the balance held by your payment processor at year-end

Note: This will only apply to organisations that prepare accounts on an accruals basis

Where this is the case, the amount that was accrued will be shown as a debtor within your year-end accounts for the prior year and will form part of your Accounts Receivable opening balances that you enter within ExpensePlus.

It is likely that the first payout from a payment processor in your new financial year will contain both income that relates to the prior financial year and was accrued for AND income that relates to your new financial year.

When the bank transaction that relates to the payout from your payment processor has been uploaded to ExpensePlus, before reconciling this payout, you will need to first split the bank transactions into two parts - one part for the amount accrued in your prior year accounts, and the other part for the income in your new financial year.

To split the bank transaction, within the view statement screen, click the edit (pencil icon) button to the right of the payout transaction.

Then split the payout into two parts required (example below)


Within the bank reconciliation screen, the part relating to the prior year should be reconciled as an Opening Accounts Receivable Balance Reversal. The part relating to the current year should be reconciled following the instructions for reconciling payouts from your payment processor (see links at the top of this article).

Note: if the amount accrued was correct, then it should correspond to the sum of all of the income transactions in payment processor payout that are dated in your prior financial year less any fees for these transactions.

Where this is the case if you are reconciling payouts using method 2 (reconciling the payout that appears on your bank statement as a 'payout from payment processor', then uploading the corresponding payout report), you will be able to upload the payout report from your payment processor without modifying it, as ExpensePlus will automatically strip out transactions that are dated prior to the date of the start date of your first financial year in ExpensePlus.

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