Amortization of Prepaids

We have a fair number of prepaid invoices amortized over time.  Currently 
these invoices are charged to a prepaid account, maintained in excel, then 
amortized to the expense account via journal entry each month.  The problem 
with this process is that, when reviewing expense variances/trends, I cannot 
identify what each of the debits in the expense account represents without 
consulting the excel spreadsheet.

Does GP provide the ability to spread the expense to different periods from 
within the purchasing module?  This is the only potential solution I can 
think of where the link between the debit and the original invoice is 
retained.  Are there any other solutions?

Thanks


0
Dan4650 (795)
2/18/2009 10:45:01 PM
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Dan,

No, you can't post a transaction across different periods.  However,
maybe a work around would be to enter relevant data about the purchase
into the Distribution Reference field in the Journal Entry when you
create it.  This field appears in the GL Trial Balance  - Distribution
Reference.  This would at least provide the source of the charge when
you look at account details.

Hope this helps,

Frank Hamelly
MCP-GP, MCT, MVP
East Coast Dynamics
www.eastcoast-dynamics.com
blog: www.gp2themax.blogspot.com


0
fhamelly1 (1404)
2/18/2009 11:42:01 PM
Dan,

2 Options

1) Run the transaction through AP or Purchasing. Rather than
maintaining an Excel spreadsheet, setup a recurring GL Batch to handle
the amortization of that transaction. In the GL transaction reference
enter info that would let you track it back to the purchase. Start the
batch names with a "z" and they will fall to the bottom of your GL
transaction window. The recurring batch is created with a set number
of transactions so it will automatically end when the amortization is
up.

more info here:http://msdynamicsgp.blogspot.com/2008/11/weekly-dynamic-
quick-and-dirty.html

2) If you really have a lot of these, get the revenue/expense
deferrals module, the contracts module or project accounting all of
which can handle your request, just in different ways.

Mark




On Feb 18, 5:45=A0pm, Dan <D...@discussions.microsoft.com> wrote:
> We have a fair number of prepaid invoices amortized over time. =A0Current=
ly
> these invoices are charged to a prepaid account, maintained in excel, the=
n
> amortized to the expense account via journal entry each month. =A0The pro=
blem
> with this process is that, when reviewing expense variances/trends, I can=
not
> identify what each of the debits in the expense account represents withou=
t
> consulting the excel spreadsheet.
>
> Does GP provide the ability to spread the expense to different periods fr=
om
> within the purchasing module? =A0This is the only potential solution I ca=
n
> think of where the link between the debit and the original invoice is
> retained. =A0Are there any other solutions?
>
> Thanks

0
mpolino (496)
2/19/2009 1:21:12 AM
Dan,

Mark mentioned this, and I wanted to give you some more detail on it.  I 
think the Revenue and Expense Deferrals module sounds like it's exactly what 
you need.  Here is a basic example:

You have an insurance bill for $10,000 which covers the year from 2/1/2009 
through 1/31/2010.  You enter the AP invoice and put the entire amount into 
Prepaid Expense.  At the same time (while in the Payables Transaction GL 
Distribution) you set up a deferral to move that $10,000 out of Prepaid 
Expense and into Insurance Expense over the period from 2/1/2009 through 
1/31/2010 in equal increments each month.  The system creates a list of the 
amounts for each month that you can approve and modify if needed.  In this 
case you would see 11 months with 833.33 and the last month with 833.37. 
When you post this payables transaction the system will create a GL batch 
with all 12 of the monthly entries crediting Prepaid Expense and debiting 
Insurance Expense.  Typically, this entire batch would be posted upfront, so 
you don't have to wait for the month to post the batch, just post it 
upfront, but I suppose you could just post the entries for each month 
separately if desired.  Since you can put cut off dates on any financial 
reports, you don't have to print future periods and I have never seen this 
be an issue for anyone.

The Revenue and Expense Deferrals module is a separate installation and may 
require a separate purchase depending on what licensing you have for GP. 
Your GP partner should be able to help you find out the details.

-- 
Victoria Yudin
Dynamics GP MVP
Flexible Solutions - home of GP Reports
http://www.flex-solutions.com/gpreports.html
blog: www.victoriayudin.com


"Dan" <Dan@discussions.microsoft.com> wrote in message 
news:69CA863F-179E-4C75-BA60-E8154047B4DD@microsoft.com...
> We have a fair number of prepaid invoices amortized over time.  Currently
> these invoices are charged to a prepaid account, maintained in excel, then
> amortized to the expense account via journal entry each month.  The 
> problem
> with this process is that, when reviewing expense variances/trends, I 
> cannot
> identify what each of the debits in the expense account represents without
> consulting the excel spreadsheet.
>
> Does GP provide the ability to spread the expense to different periods 
> from
> within the purchasing module?  This is the only potential solution I can
> think of where the link between the debit and the original invoice is
> retained.  Are there any other solutions?
>
> Thanks
>
> 

0
victoria (3339)
2/19/2009 12:03:50 PM
Reply:

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