Processing Prepayments

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

We strongly recommend reading Overview Of Prepayments before carrying out any prepayments processes.

If you are processing prepayments on purchase order invoices using IRIS Purchasing, for more information, please see Processing Prepayments In IRIS Purchasing.

Before posting any prepayment documents, it is essential to check that all the accounting periods within the prepayment time frame exist, and have the appropriate security roles applied of PERIOD.8 or less. You are unable to post prepayments to the correct periods if the accounting periods are not correctly available and can be timely to rectify.

If you experience any problems with prepayments as a consequence of accounting periods being closed or having the wrong access level, please see Dealing with Prepayments Posted to the Wrong Period.

Prepayments are typically recorded for non order invoices or credit notes. They can also be entered as miscellaneous payments but this is rare.

1. To post a prepayment, complete the applicable document input form. In the following example, the graphic shows prepayment dates entered for a Non-Order Purchase Invoice document based on an annual insurance premium example.
2. Enter the start and end dates for the prepayment in the Prepayment Start Date and Prepayment End Date fields. The dates entered must be in DD/MM/YYYY format, e.g. 01/09/2020.
   

3. When you have entered all the required details, press F5 or select POST to post the document. Once posted, the system automatically creates a FEPB - Payment Move to Balance Sheet (where FE represents the location code) document, which transfers the balance from the applicable expense nominal and account into the prepayment nominal on the balance sheet. Using our earlier example, the £12,000 annual insurance premium has been transferred.
   

4. Based on the prepayment start and end dates previously entered, the system calculates the number of accounting periods within the time frame, together with the amount that should be allocated to each accounting period. A FEPM - Payment Movement (where FE represents the location code) document is then posted for each applicable accounting period. Using our earlier example, 12 documents are created for each accounting period within the year and for a value of £1000.