In this topic we will examine the end of the accounting period, the steps to be taken then, and the ramifications of the period end throughout the system.
At the end of your accounting period, a number of tasks must be performed.
Some of these affect ageing of transactions and posting to the Nominal Ledger, and others are concerned with keeping your transaction records up-to-date.
In an integrated system, accounting periods are set in the system parameters menu of the Nominal Ledger. This option allows a wide range of choices for weekly and monthly periods, and allows separate periods for the Nominal Ledger and the calculation of VAT.
Warning: This is a critical area of your system set-up and if you are in any doubt concerning it, consult support personnel.
As a matter of standard accounting practice, the Purchase Ledger period is often closed before the period is closed in the Nominal Ledger. Autoline Purchase Ledger software supports this practice.
The Display current period option displays the three periods mentioned, the Nominal Ledger period, the VAT period, the Sales Ledger period and the Purchase Ledger period. For each such period, a start date and an end date for the current period and a start date and the end date for the current year, (chiefly of significance when the period change also involves a year change), are displayed.
The number of the current period, and the actual current year within the Nominal Ledger, the Purchase Ledger and the VAT system are also shown.
BUTTONS:
Exit: Returns you to the PURCHASE LEDGER menu.
Help: Displays help on the current application using the default browser.
The End Current Period option on the Miscellaneous options menu performs the tasks which ensure the correct alignment of periods between the Purchase Ledger and the Nominal Ledger at period ends.
Warning: This option should be used with caution and ideally is only made available to a designated system supervisor. It performs a variety of critical tasks.
Firstly, it changes the current period dates on the system controls to the next financial period start and end dates. If the end of the financial year is due, the year start and end dates are also changed.
Secondly, it removes values from the period-to-date figures on each Purchase Ledger account relating to the period being closed. If the end of year is detected, the year-to-date figures are also treated in the same way and, if appropriate, copies the year-to-date figures into the ATD fields (if these are being used for previous year only).
Thirdly, if the optional facility to keep an account balance history is being used, a number of other changes will be made. In the first place, the following details in the currency of the account are transferred to the history file.
The period-to-date turnover
The total balance outstanding
The number of items outstanding
The average age of the debt, in days
The history file contains thirteen rolling periods, showing the last period's figures and the previous twelve periods. At each period end, the oldest period is lost and the latest period is inserted.
Finally, if no movement has been detected on an account, the counter for periods unused is incremented by one.
This option displays a window identical to that of the Display current period option, except that it has an Advance button.
Note: Click the Advance button to automatically begin to update the current period. This action can only be cancelled by closing the progress screen. The process usually only takes a matter of seconds to complete, unlike the Nominal Ledger.
For all inputs to the Purchase Ledger, the system checks the transaction dates against the period date in the Purchase Ledger system controls. It does not permit retrospective posting, unless your access priority is set high enough to override this control. This priority is set in the system parameters. In effect, only high priority users may post retrospectively, and the system warns that the posting is for a date outside the current period.
The VAT analysis uses the posting date, and so maintaisn the cut-off at the Purchase Ledger period end. In this way the VAT analysis balances with the Nominal Ledger.
Note: The Purchase Ledger period end routine must be run before the equivalent Nominal Ledger period is closed.
