Posting an Accrual

Some Of the nominals and ledgers used in this topic may be different to those in your chart of accounts.

An accrual on income or expenditure is an amount due or the calculation of an amount due in an accounting period, which is unpaid at the end of that period. This could be an insurance premium or an electricity bill that has not yet been paid, or interest which is due, but has not yet been received.

In the financial statements, accruals are:

• Added to the income or expense account (e.g. insurance account, electricity account, interest, etc.)
  shown in the trial balance before it is listed in the statement of profit or loss.

• Shown as an asset or liability in the year end statement of financial position.

The reason for dealing with accruals in this way is to ensure that the statement of profit or loss records the amounts that has been incurred for the year, instead of simply the amount that has been paid. In other words, the income/expense is adjusted to relate to the time period covered by the statement of profit or loss. The year end statement of financial position shows an asset/liability for the amount that is due but unpaid.

The automatic accrual reversals is a function performed on an Accrual document input form, which is used to automatically reverse and allocate any accrual posted in the system at the Date, Year code and Period specified on the original posting.

This topic assumes that you are familiar with the completion of document input forms. If you need more detailed instructions (such as the selection of dates, periods, and accounts, and so on. Refer to Completing Document Input Forms.

Posting an Accrual consists of the following:

Selecting the Accrual Document Input Form

Recording the Details of the Accrual

Selecting the Accrual Document Input Form

1. Go to Documents, then select Document Input from the menu.
   
2. Select ... in Document type, then double-select to select ASAC - Accrued Income / Expense (where AS represents the location code of the document) from the Select a document type dialog.
   
3. The Accruals input form is then displayed in Input form. The Number defaults to the next number in the sequence for the selected document type.

4. The Date defaults to the current date and the Period defaults to the current accounting period.

   The date and period must be the date the accrual is being posted (this could be the last date of the accounting period). If the date needs to be changed, select the down arrow and select the required date from the calendar. If the period needs to be changed, select the Drill (...) in Period, then double-select to select the required period from the Select a period dialog.

5. Select OK to confirm your selections. The applicable document input form is then displayed.
   

Recording the Details of the Accrual

1. The Accruals document input form is displayed populated with the details entered in the Document Input dialog.
   
2. To select the type of accrual being recorded, double-select Transaction Type, then double-select to select an option from the Select ACCRUAL_TYPE key dialog.
   
3. Next, enter the total value for the accrual in Amount, e.g. 1200.00 (do not enter any currency symbols £, $, etc.)
   
4. To reverse the accrual, the Reversal Details need to be completed. Enter the date for the reversal, in DD/MM/YYYY format, in Reversal Date, e.g. 05/02/2021.
   
5. The year to which the accrual is to be reversed defaults to the current accounting year. To change the year, over-type the year details, in YYYY/YY format, in Reversal Year, e.g. 2020/21.
   
6. The period to which the accrual is to be reversed defaults to the current accounting period. To change the period, over-type the period details in Reversal Period, e.g. 06.
   
7. Next, to select the type of accrual being recorded, double-select Accrual Type, then double-select to select an option from the Select ACCRUAL_EXP key dialog. If an applicable accrual option is not listed, you can create a new accrual key. For more information, refer to Creating A New Accrual Profile.
   
8. To select the account to which the accrual relates, double-select Account, then double-select to select an account from the Select AST_COSTCTR account dialog (where AST represents the location code of the account list).
   
9. Next, enter the value of the accrual in Value, e.g. 1000.00 (do not enter any currency symbols £, $, etc.)
   
10. The description for the accrual is automatically populated when the type is selected and used to identify the document when it has been posted. To change the description, select Description, then over-type the description in the field.
    
11. If the accrual you are entering details for was made up of several individual items, for example, electricity and gas, you need to add another item line to the document input form to add the details for the additional item(s). To create a new item line, select in the blank field on the completed item line in the table, then select INSERT ROW. A new item line is added. Complete the accrual item details as per the previous steps.
    If the Amount and Value do not balance on the Accruals document input form, the Total Accrual and Individual Expenses Do Not Match Please Balance Document message is displayed in red in the bottom of the window, as shown in the following graphic. You are not able to post the accrual document until this has been corrected.
    
12. To correct the error, check the Amount equals the amounts in the Value fields. If these are different you need to make sure you have entered the correct amounts and all items included in the accrual, or if they are incorrect, amend the Amount or Value fields accordingly. When the Amount and Value fields balance, the Total Accrual and Individual Expenses Do Not Match Please Balance Document message is removed.
    
13. When you have entered the required accrual information, press the F5 key, or select POST to post the document.