Hi,
The company I work for just added a few new service lines to its portfolio and I am not sure how to account for a couple of them.
1. Payment services - where we provide a bridge between our customers who do not have an ability to receive online payments and their customers who want to pay online. Thus our company receives funds through online means and transfers them to our customer as a lump sum by bank transfer. To avoid excessive transfer charges we hold on to the funds until an agreed limit is reached.
This is technically not our money therefore it should not be part of the company's income. The only income I think should be the set service fee that our company charges. I am unsure however how to account for the rest of the received funds.
2. Marketing- where our company requests an agreed down payment for a campaign some of which can run for longer periods. Cost of running the campaign is from the down payment received, customer receives a statement and tops up as necessary. Again the only income is from the service fees our company charges for the services provided. As these campaign funds and expenses are not ours should they hit the income statement? What is the correct way of accounting for this?
Many thanks.
The company I work for just added a few new service lines to its portfolio and I am not sure how to account for a couple of them.
1. Payment services - where we provide a bridge between our customers who do not have an ability to receive online payments and their customers who want to pay online. Thus our company receives funds through online means and transfers them to our customer as a lump sum by bank transfer. To avoid excessive transfer charges we hold on to the funds until an agreed limit is reached.
This is technically not our money therefore it should not be part of the company's income. The only income I think should be the set service fee that our company charges. I am unsure however how to account for the rest of the received funds.
2. Marketing- where our company requests an agreed down payment for a campaign some of which can run for longer periods. Cost of running the campaign is from the down payment received, customer receives a statement and tops up as necessary. Again the only income is from the service fees our company charges for the services provided. As these campaign funds and expenses are not ours should they hit the income statement? What is the correct way of accounting for this?
Many thanks.
