Weismann Tax Firm

Elena Weismann
Graduate Economist, Tax Consultant
Certified Consultant for International Tax Law

Posting of EC card transactions in cash management

by Elena Weismann in News from tax law

In businesses with predominantly cash transactions customers often opt for cashless payments using EC cards. However, the booking practice performed by these companies has recently been questioned. At first the total turnover including cashless business transactions (EC card payments) is recorded in the cash book, and in a following step the EC payments are then again removed and separated. The total amount is also posted to the cash account before the EC card transactions are cleared again. The Federal Ministry of Finance (Bundesministerium der Finanzen) remains to see this as a formal deficiency in bookkeeping.Cash and non-cash business transactions must be posted separately. Only cash transactions are to be recorded in the cash book. However in a recent letter the Federal Ministry of Finance has somewhat defused this legal opinion. Admittedly the temporary recording of EC card transactions in the cash book continues to constitute a formal deficiency. However, this deficiency is regularly overlooked when weighing further formal deficiencies in regard to a possible distortion of bookkeeping. The prerequisite for this situation is that the payment method is sufficiently documented and that the actual cash balance can be verified at any time (ability to fall from the till).

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