Setting Up Payment Accounts for Commissary and Internal Transfers

In order to send internal transfers to your accounting system, we strongly recommend you set up specific Payment Accounts to accommodate your transfers. The Payment Accounts you create and the option you choose will depend on your company structure. 

Once you know which Account Configuration you want, you will need to set up the appropriate Payment Accounts to complete the setup.  


Transfer Payment Account Configurations

When completing initial setup for internal transfers or a commissary vendor, you will notice that there are three different ways to configure your payment account setup for internal transfers. 


Below is an explanation of each type of configuration:

Use one payment account for all transfers to and from this restaurant

If you are using one bank account for all of your units, then this is most likely the configuration setting you want. This configuration allows you to pick one payment account to close all internal transfers to and from your restaurant.

For this configuration, we recommend one Payment Account called "Internal Transfers" and suggest you map it to an internal Clearing Account, or Other Current Liabilities account.

Use different payment accounts for each restaurant

If your restaurants will be moving money around to pay for these transfers, we recommend you set up separate Payment Accounts for reach restaurant. Selecting this configuration will then allow you to pick different payment accounts to close internal transfers to based on where the transfer is coming to and from.

For example, if you are Restaurant A and you have two other restaurants, you could set up separate Payment Accounts for "Transfers To/From Restaurant B" and another for "Transfers To/From Restaurant C". 

The advantage of this configuration is that it will allow you to split out internal transfer activity by restaurant in MarginEdge and in your accounting system to show you a net balance.

[Advanced] Use different payment accounts for each restaurant based on the direction of the transfer

This configuration allows you to map different Payment Accounts to internal transfers based on both the direction of the transfer and who is sending the transfer. 

For example, if you are Restaurant A and you have two other restaurants, you would create 4 separate payment accounts:

  1. Transfers to Restaurant B
  2. Transfers from Restaurant B
  3. Transfers to Restaurant C
  4. Transfers from Restaurant C

The advantage of this configuration is that it will allow you to split out internal transfer activity by transaction type so you can easily identify exactly how much you are transferring to and from each restaurant. You would be able to view the balance due to (as a liability) and the balance due from (as an asset). 


Creating Payment Accounts

Once you have selected your configuration, you can now select the appropriate Payment Accounts. If you have not already created your Payment Accounts, you can do so by going to the Accounting > Payment Accounts page.

Create the necessary Payment Account(s) and set the Type to “Account Type - Other” which specifies that instead of an invoice or bill being sent to the accounting system, a journal entry will be sent.

Once you have named your Payment Accounts in MarginEdge, you will want to map them to a balance sheet account in your accounting system which will accommodate these transfers. This balance sheet account is typically an “other current liabilities” type account; note we cannot export Internal Transfers to an Accounts Payable or Accounts Receivable account


Frequently Asked Questions

What is the difference between Internal Transfers and Commissary Transfers?

Both in-app features require your restaurant units to be set up to share a Concept in MarginEdge. The Commissary Feature is an internal tool that allows you to convert recipes into products and transfer them from a designated central location to your other restaurant units. Internal transfers are also an in-app process but designed for transferring products back and forth between your different restaurants.

Note that Commissary Transfers are initiated by the receiving unit; Internal Transfers are initiated by the sending unit. 


Can I book my Commissary Transfers as Sales?

No. Commissary transfers are book as credits to your COGS, not credits to revenue at the Commissary location. Currently, there is no way to book commissary transfers as sales. 


How will this look in MarginEdge reporting?

If the product names match those that are in MarginEdge we will associate the vendor item created by the transfer with the existing product in MarginEdge. At the sending location, this will subtract the value of the transfer from the purchased amount of that product, and correspondingly the value of that transfer from your COGS reporting. This will look the same as if your vendor gave you a credit for the product, except the “vendor” in the case of a commissary, is another one of your restaurants. Likewise, at the receiving location, the transfer will be added to the purchased quantity of that product and corresponding COGS category as if it was purchased from any other vendor.


How will this look in my accounting system?

At the sending location, a journal entry will be exported to your accounting system, crediting the appropriate COGS categories and debiting the other balance sheet account designated for these transfers. At the sending location will be an equal but opposite journal entry, crediting the balance sheet account and debiting the cost of goods. How this is set up in your accounting system (i.e. which balance sheets accounts you map the Internal Transfers Payment Account to) is up to you. 


How can I create a report showing me my transfers?

It takes some spreadsheet work, but check out this article on the topic.


I want to export these transfers as invoices to be received and bills to be paid, can I do that?

We cannot export an invoice to accounts receivable so this is not possible. The only way to transfer products is as Journal Entries as described above.  



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