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Processing ACH Direct Deposits

ACH Direct Deposit Routine

NEMRC's original custom program for processing direct deposit transactions was named PRCUS66. Minor modifications have since been made to this report and a new version named PRCUS66B has been created.

Before running PRCUS66B for the first time using a live Payroll, it must be tested according to the following simple procedure. It is a good idea to run your regular Payroll several days early. Banks often require at least three days lead time for this test. If you have been using previous versions of this procedure, PRCUS66 or PRCUS66A, then you will not need to do any tests, and can switch to PRCUS66B without a problem.

Be aware that the terms "ACH file" and "electronic funds transfer" are nearly synonymous. For consistency, this procedure sheet will use the terms "ACH file" or "ACH output file" throughout.

Summary of Procedures:

  1. First, make certain that the employees who will be using direct deposit have their direct deposit deduction correctly set up in the Payroll module. This is done through "6. Employee Maintenance" off the Main Menu, in the "Deductions" tab.
  2. Next, go to the "R. Reports Menu," and choose "Z. Custom Reports and Routines." Run the PRCUS66B routine after coordinating a time with your bank to test the ACH output file for data validity. A few days lead time will allow for some degree of troubleshooting. For instance, routing numbers may be incorrect. You may need to void some checks and run them again, if errors have occurred in the setup.

    There is no limit to the number of times you can run PRCUS66B, the ACH output file only becomes effective when your bank sends it out into the national banking system.

Initial Setup

By following the steps below, you will be able to set up this routine and then process this custom electronic funds transfer procedure.

  1. Go to "R. Reports Menu" from the Payroll Main Menu.
  2. Go to "Z. Custom Reports and Routines."
  3. Click the "New" button.
  4. Type "PRCUS66B" under Select.
  5. Type "ACH DIRECT DEPOSIT" under Description.
  6. The command has to be typed in exactly as follows: PRCUS66B
  7. Click "OK" and you will return to the selection screen.
  8. Select "PRCU66B" from the list and click "Run."
  9. The ACH file information screen will now appear. A few questions have been added to the ACH file information screen in the new version of the routine.

ACH File Information Screen Questions

  1. Most of the information asked for on this initial screen is best provided by your bank, if you do not already know the answers. Three of these questions we can address here.
  2. Description of transaction: This is for your own reference only and can be answered in a way that suits you best.
  3. Your checking account number: Use the checking account number from which you write Payroll checks.
  4. Use batch control records?: This will default to "Y"es. Accept the default answer of "Y"es unless you have specific information to the contrary from your bank. Some banks and ACH software require that batch control records not be included.
  5. Continue answering questions to create an ACH output file using your last Payroll. Send this file to your bank, but make sure they know the file is being provided as a test. Your bank will advise you on their preferred method of file transfer. Please let us know the results as soon as you hear from your bank. If your bank approves the file, then you can also use the test file as your actual ACH file. If there is a problem of any kind, you may need to void some checks, and run PRCUS66B once again.

A Few Words about "Prenotes"

  1. Prenotes, or prenotifications, are a means by which some systems check the setup of new or first-time employees to make certain that any financial information sent out in an ACH file contains usable routing information. The financial transactions must be routed to the desired bank accounts. Prenote files have initial transaction amounts of zero by default, and are used merely as a validity test. Many banks have moved away from using prenotes, preferring to use actual data files to check validity. Check with your bank to see whether they will require you to use a prenote ACH file.
  2. Process Prenotification?: Answer according to your bank's instructions.
  3. Prenotification for All or Selected employees?: If you answered "Y"es to the Process Prenotification question, this question will appear. Answer according to your bank's instructions.

    If you choose "A"ll, then every employee with his or her direct deposit deduction marked "Y"es on his or her deduction screen will be included in the prenote ACH file. This option is usually for first-time ACH users or special circumstances.

    If you choose "S"elected employees, then you will be able to pick out one employee at a time to be included in the prenote ACH file. This option is ordinarily for new employees or those who decide to switch to electronic funds transfer for all or part of their Payroll.

If you have any questions, please call NEMRC support at 800-387-1110



Last updated: 7/7/2008