What is impress account?

Answer 1

An imprest account is an account that always has the same balance. There are usually no entries made to this type of account (unless you wanted to increase or decrease the imprest amount).

A good example is Petty Cash. You open the account by writing a check for, say $250. (Debit Petty Cash, Credit Cash.) The funds are kept in a locked cash box and used to make small incidental purchases (stamps, donuts for a company meeting, etc.). A receipt or voucher is placed in the cash box for each purchase. The cash box always contains $250 in cash and receipts. When the amount of cash is getting low (perhaps under $20), A check is written (and cashed) to replenish the petty cash box. The debits are to the various expense accounts (Postage, Office Expense, etc.) and the credit is to Cash (just like any other check). Then, the cash box is back to $250 in cash and no receipts (they were attached to the check stub). As you see, there was not a second entry to the Petty Cash account.

Some companies will have a separate checking account for Payroll which is an imprest account. The account is opened in the same fashion and each pay period, the exact total amount needed for payroll is transferred to that account. The payroll expenses and tax liabilities are recorded in total (as opposed to posting each individual paycheck) and the offset is to the account where the transfer originated. Again, no entries are made to the imprest account.