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A2X for Shopify and AfterPay: Reconciling payouts and accounting for AfterPay fees monthly
A2X for Shopify and AfterPay: Reconciling payouts and accounting for AfterPay fees monthly

Learn how to balance the A2X AfterPay Payouts to the AfterPay monthly statement and account for the external AfterPay fees.

Iona Bird avatar
Written by Iona Bird
Updated over a week ago

In A2X for Shopify, the AfterPay payouts are generated as per the data fetched from Shopify. The expected deposit amount that A2X allocates to the clearing account per AfterPay payout is the gross amount - so the AfterPay fees are not deducted. Why? Simply because the AfterPay fees don't pass through your Shopify account, which is what A2X is connected to.

This guide will explain how to confirm that the A2X payouts balance back to your monthly AfterPay detailed statement, as well as how to allocate your AfterPay fees on a monthly basis.

1/ In A2X - sort your payouts list by the payment gateway

For reasons of clarity, we have listed below the A2X AfterPay payouts covering the month of December, that we will cover in this article:  

Please Note: The account in our example is set up to generate AfterPay payouts on a daily basis. However, you can also set A2X to generate either weekly or even better, monthly payout entries for your other payment processors such as PayPal, AfterPay, Sezzle, Stripe, etc.

2/ In AfterPay - download a monthly report of account activity for a given period

In AfterPay, you can download a detailed settlement statement in CSV format from the Afterpay Merchant Portal. 

To download the statement from AfterPay:

  • Log on to the Afterpay Merchant Portal and select the Settlement section

  • Select the ‘Export’ button to download settlement data for the chosen date

  • Select the ‘Settlement Export’ button to download settlement data for a range of dates

The following information is provided in the CSV download. We have highlighted the column titles relevant to this guide:

  • Settlement Date

  • Order Date and Time

  • Order Month and Order Year

  • Afterpay Order number

  • Merchant Order number

  • Order Amount

  • Settlement Amount

  • Afterpay Merchant Fee applicable to Order (excluding GST)

  • GST applicable on the Afterpay Merchant Fee

  • Total Afterpay Merchant Fee including GST

  • Net amount settled for Order

  • Type of transaction (order or refund)

We requested the December report as shown below and excluded/greyed out the unnecessary text detail for simplicity purposes. You will note we have added a border around a single day in the AfterPay report - the total in that selection matches the payout total in A2X for the same day.

For simplicity, we have summarised the AfterPay report daily and added just the necessary items to a pivot table (date, settlement amount, merchant fee including tax, and net settlement amount) so that we can easily compare the totals. 

3/ Compare and balance the A2X payout amounts to the AfterPay Statement data

And summarised to include the total of the fees:

This is the flow of events:

  • Throughout the month, A2X is posting the AfterPay payout total or 'expected deposit amount' to the Gateway Clearing account. 

  • Throughout the month your AfterPay deposits are received into your bank account, net of fees. These deposits are allocated to the Gateway Clearing account to offset the balance entered by A2X.

  • At the end of each month, the difference in your Gateway Clearing account will generally be the AfterPay fees. The fees need to be accounted for by completing a journal entry deducting the monthly fee total from the Gateway Clearing account, allocating it to your AfterPay fees expense account. 

Please Note: On the odd occasion, the difference in the Gateway Clearing account may also be caused by a carry-over balance for a transaction that hasn't cleared yet.

If we put the above flow of events into numbers:

  • A2X has allocated an amount of $63,174.22 to the Gateway Clearing account for the month of December 2019. 

  • We have allocated all AfterPay deposits throughout the month to the Gateway Clearing account - the total of the AfterPay deposits for December 2019 is $58,583.39. 

  • This leaves a balance in the Gateway Clearing account of $4,590.84 - which is the total of the AfterPay fees for December 2019. 

4/ Account for the AfterPay fees using a manual journal entry

In QuickBooks Online, the monthly entry for the December 2019 AfterPay fees would look similar to this:

In Xero, the monthly entry for the December 2019 AfterPay fees would look similar to this:

The end result is that the Gateway Clearing account is reconciled back to $0.00.
As mentioned above, on the odd occasion there may be a balance that will carry forward into the next month due to timing.

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