How do I account for a company spend on behalf of a client?

[TUS373]

Morning all. I am having a brain freeze on how to account for the following transaction within our company books - please can anyone give me a quick answer?

1. We are to register our client for a membership of an organisation (they don't know how to do it) - the membership fee is say £100 + VAT
2. Our company pays the £100, but that generates a receipt with the client's company name on it, not ours
3. We then have an expenditure, but not with our company's details on it

We will get reimbursed of course, it is just how do I enter that into our accounts for now (will get checked by accountant later).

Many thanks.

[Mr Pointy]

Why would the invoice/ receipt have the client's company details on it instead of yours? You are the one placing the order.

[Ham_and_Jam]

As pointy said, I would have thought you purchase and re-invoice to your customer.

Put a note on the transaction regarding the proxy purchase with their details on it.

[MustangGT]

Not something I would advise doing. May also have VAT implications as well.

[dave123456]

You would just re invoice the client and the impact on your books would be nil.

If they are not vat registered they will suffer the vat but your books will just contra out and nil effect.

[TUS373]

Thanks all.

I do not want to complicate matters with too much detail as it will probably add nothing.

The key thing as I see it is that we are paying in lieu of a client as we arranging something for us, but how do we process an invoice that has their company name on, not ours?

We will be compensated - we can bill them, that is easy. It is just how do we account for the first transaction?

Thanks

[dave123456]

You are over thinking it. And others will too. Just book it on your system and then when you recharge it book the sales invoice to the same place.

It’s not strictly correct but it will be fine.

[TUS373]

Thanks. I was concerned that our books are wrong/look wrong. It balances out - just looks odd.

Thanks

[dave123456]

The only real challenge may arise if customer is not vat registered, but that’s not your problem.

[MustangGT]

TUS373 said:

Thanks all.

I do not want to complicate matters with too much detail as it will probably add nothing.

The key thing as I see it is that we are paying in lieu of a client as we arranging something for us, but how do we process an invoice that has their company name on, not ours?

We will be compensated - we can bill them, that is easy. It is just how do we account for the first transaction?

Thanks

I see this as the potential issue myself.

[Doofus]

MustangGT said:

TUS373 said:

Thanks all.

I do not want to complicate matters with too much detail as it will probably add nothing.

The key thing as I see it is that we are paying in lieu of a client as we arranging something for us, but how do we process an invoice that has their company name on, not ours?

We will be compensated - we can bill them, that is easy. It is just how do we account for the first transaction?

Thanks

I see this as the potential issue myself.

How does a company process a personal expenses claim from an employee, if the bill is in the employee's name?

Answer: It's really not an issue.

Raise an invoice for £100 (+VAT) to your customer. Book the invoice to the same P&L code to which you booked the original payment.

[Mandat]

Can you process is like any other expense receipt that doesn't have your company name on it?

[dave123456]

MustangGT said:

I see this as the potential issue myself.

Why?