Connected bank categorize credit card refund

ephraim

I have connected my bank to wave and it suppose to recognizes when a specific amount is transferred from "Payments By Wave" account to "Bank" as a WITHDRAWAL and it creates a another transaction to "Bank" account from "Payments By Wave" as DEPOSIT - which is all good.

The problem is when I see a REFUND, the transaction is shown only as a one-way transaction called "Invoice payment" which puts a WITHDRAWAL at the "Payments By Wave" account but a few days later when I see the actual transaction taken from the "Bank" (since it's connected to the bank automatically) it comes up as "Uncategorised Expense" how can I somehow combine them.

Alexia

Hi, @ephraim,

You can categorize that expense in your bank account as a transfer to Payments by Wave. Wave will create the other of the transfer automatically, and all of your numbers will get back to what they're supposed to be.

If you'd like me to break down the accounting behind all of it, let me know. I'd be happy to help!

ahwern

Hi @Alexia I know this is an old conversation but could you break down the accounting behind all of this? I just processed my very first refund because of a partial return so it would be helpful to see what the steps are.

Thanks.

AlexL

Hey @ahwern . If your bank account is already pulling in transactions into Wave, these changes will be automatic and you don't need to account for anything. Iif this is not the case, you can do the following.

Create the expense transaction in Wave on the date that the refund was taken out of your bank account. Categorize it as "Transfer from Payments by Wave" which will create the other end o the transfer for you into your Payments by Wave account.

Basically the reason you're doing this is because when you create a refund in Wave, it puts the money into the Payments by Wave account which is a holding account that houses your money until it moves out of your bank account. We do this for reconciliation purposes to track exactly when things are paid and when money moves in Wave.

ahwern

Perfect. Thank you.