Pimbrook Software

5085: How to set up a one month accrual for over the year end

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Author: Pimbrook Support

 

How to set up a one month accrual for over the year end

 

To process a one month accrual over the year end, you need to manually post an accrual in the last month of your financial year, then reverse it in month one of the new financial year.

Note: In the following example, you have estimated that approximately £/€100 of an expected telephone bill relates to the current year.

 

To post a year end accrual

1. Nominal codes > Journal entry.

Sage Accounts 2013 (v19) and 2014 (v20) – Company > Tasks pane > Journal Entry.

Sage Accounts 2012 (v18) and below – click New Journal instead of Journal Entry.

2. Enter a reference and date for the journal, then enter the relevant information to record the accrual into the current year’s accounts, for example:

N/CNameDeptDetailsT/CDebitCredit
7502TelephoneDepartmentAccrual AdjustmentT9100.000.00
2109AccrualsDepartmentAccrual AdjustmentT90.00100.00

 

3. Note: The date for this journal must be in the current financial year.

4. Save > Close.

You have now increased the balance on the Telephone nominal code, and on the Accrual nominal code in the Current Liability section of the balance sheet report by £/€100. After running the Year End option you should reverse this transaction, this moves the value back from the balance sheet to the overhead nominal code.

 

To reverse the year end accrual

1. Nominal codes > Journal entry.

Sage Accounts 2013 (v19) and 2014 (v20) – Company > Tasks pane > Journal Entry.

Sage Accounts 2012 (v18) and below – click New Journal instead of Journal Entry.

2. Enter a reference and date for the journal, then enter the relevant information to record the accrual into the new year’s accounts, for example:

N/CNameDeptDetailsT/CDebitCredit
2109AccrualsDepartmentAccrual AdjustmentT9100.000.00
7502TelephoneDepartmentAccrual AdjustmentT90.00100.00

 

3. Note: The date for this journal must be in the new financial year.

4. Save > Close.

You have now moved the value of the accrual from the balance sheet nominal code back to the relevant profit and loss nominal code. This appears as a credit balance on the overhead nominal code and reduces the new year’s balance on the overhead by the value relating to the prior year.

When the invoice is eventually received, post it in the usual way. This leaves the correct value for the new financial year on the overhead nominal code.

 


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