Adjustments and Integrations

#1 Adjustments and Integrations

The second section enables the user to manage automatically, at the end of the mid-year data retrieve, the related adjustments and integrations records. Let us see in detail the logic applied by the software.

First of all, this type of adjustment records is performed automatically as regards the economic detail account movements linked to an account type that has set the 'Service' flag. Usually it is recommended to define two types of account and two types of revenue: one of these corresponds to the normal profit/loss to be associated to sales/purchase of goods (for which the balance management has to be linked to the valorization of oddments), the other will has to be linked to those detail accounts that needs a service (typically) belonging to a period, for example a rent, a periodical rent or assurance. Secondly, the reference of adjustments/integrations is to be referred to the accrual dates range inserted into petty cash book movements (and in cost/profit centres as regards the analytical section).

 Automatic Adjusting Entry: after having set the template that will detect the operation and by setting the flag, it will be possible to activate the automatic management of adjustments. In order to adjust the CC /PC movements it will be necessary to provide for the management. The default settings (group by record and the use of solar calendar) are recommended to be used. Through this flag the program will verify the cost/revenue lines from accounting according to record/accrual dates range set, in order to create deferred of days out of the accrual date range set for the closure. The deferred detail accounts to be used will be those inserted into the chart of accounts in correspondence to the single cost/revenue detail account or the generic detail account inserted into accounting parameters of the same mid-year closure year. This flag creates automatically what the user can manage manually on the 'Adjusting Entry' procedure.

 Automatic Integration Entry: after having set the template that will detect the operation and by setting the flag, it will be possible to activate the automatic management of integrations. In order to adjust the CC/PC movements it will be necessary to provide for the management. The default setting of solar calendar is recommended to be used. Through this flag the program will verify the cost/revenue lines on accounting starting from 'Accrual Start Date for Ledger Integration', in order to create accrued of days within the accrual date range set for the closure. The accrued detail accounts to be used will be those inserted into the chart of accounts in correspondence to the single cost/revenue detail account or the generic detail account inserted into accounting parameters of the same mid-year closure year. This flag creates automatically what the user can manage manually on the 'Adjusting Entry' procedure.

This procedure is particular important as regards the start date to be set, because usually it will be set as the same one of last accounts opening date on accounting. For example: if the user is creating the closure of the first quarter of accounting period, the dates range for the economic section will be typically 01/01/year - 03/31/year and if there is the accounts opening of the previous accounting period this means that within this range there will be directly the giro account to cost/revenue of accrued in balance sheet 'year-1' and so the start date for integrations will have to be set as 01/01/year in order to be sure that the software verifies if after 03/31 there are lines with accrual in the previous quarter. If there is not the opening, on the contrary, it will be necessary to set the start date as 01/01/year-1 in order to make sure that the ERP verifies if in the previous accounting period there are costs/revenues which correspond to the initial quarter of this accounting period. If the user has already measured the period accrued manually in accounting on 12/31/year-1, but there was no closure/reopening, the integration entry could cause a double survey of accrual accrued income.