ADVANTAGES OF POSTING TO FUTURE PERIODS AND YEARS

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The below images are examples of Posting to Future Years with 4 years depreciation in single batch having 49 accounting entries from January 8, 2016 (FP:201601) to January 7, 2020 (FP:202001).
From:
Batch 1, Entry 1, Fiscal Period 2016-01, Posting Sequence 10
To:
Batch 1, Entry 49, Fiscal Period 2020-01, Posting Sequence 10


Legends:
B-E = Batch & Entry numbers, FP = Fiscal Periods, PS = Posting Sequence Numbers

Below is the webpage of Ikonomikal's Fixed Asset Management (AM) Depreciation Batch Run. It generates periodic (monthly) multiple automatic entries up to future years. 

Posting to future years is one of the best features of Ikonomikal Cloud Accounting ERP. It is all about what updated record can help in making decision to avert financial fiasco. Having updated daily and end of the month financial report compared to budget and expected current and future periods provide the decision makers the status and idea what better actions to take forward.

Posting to future years means great reduction of end of the month workload of every accountant. This feature together with the reconciled subsidiary ledgers to general ledger control account and as well to customers and suppliers, and the updated bank reconciliation make it easy for the accounting department to finalize the month end closing at exactly the end of each month. The efficiency goes as well at the end of the quarter and at the end of the fiscal year or calendar year. In addition, future years posted transactions are big relief in the preparation of budget in future periods and years due to the actual future data.

Below are situations and the additional advantages of posting to future periods and years of accounting entries entered either in previous, current, next period or period until end of year or periods of succeeding years. Take note that posting to previous fiscal periods need approval if audited, or already reported to the management.

1) There is no need to wait for the beginning balances of the general ledger accounts or subsidiary ledgers during system implementation because transactions can be posted on periods of previous, current or future years anyway. This is also one of the reasons why the implementation period of Ikonomikal is always short and successful.

2) Depreciation for all periods until end of its useful years on straight-line method in one batch and one time posting, see example images above. This eliminates month end job of doing depreciation for all assets. The result is Fixed Asset Register or Lapsing Schedule is available anytime.

Examples of fixed assets to depreciate are:
    a) building with depreciation of 30 years,
    b) vehicle of 4 years
    c) plant machinery for 10 years, and
    d) others

All these can be automatically depreciated spreading periodically until the end of useful years.

Automatic reversal is available for posted future depreciation entries on assets to dispose before the end of useful years. Example situations of early disposal could be accident for cars, damaged machine or building due to fire or calamity, loss of properties to robbers or technology obsolescence. 

3) Amortization of pre-operating expenses for multiple number of years done in only one batch spreading periodically in their respective years.

4) Amortization of prepaid expenses for multiple years. A good example is Insurance Expense paid in advance for 2 years to avail discount. This will be amortized automatically in one batch equally distributed in 24 (periodic) months.

From:
Batch 4, Entry 1, Fiscal Period 2016-01, Posting Sequence 12

To:
Batch 1, Entry 25, Fiscal Period 2018-01, Posting Sequence 12

The GL JV Batch Copy automatically generates periodic (monthly) multiple entries in a batch. The below image is set to do 24 amortization of periodic (monthly) accounting entries which is for more than a year.

5) Accrual of periodic estimated expenses extended to more than 1 year can be done with corresponding automatic reversal on the following period and replaced by the actual amount of invoice. Or credit the estimated accrual and debit/credit to expense the difference upon recording of the invoice to payable or upon payment if not on account.

Good examples are predetermined expenses such as electricity, water and other expenses regularly invoiced by suppliers. Hence, even the invoice is delayed the estimated expense was already posted. Though may have slight difference but the result will turn to actual at the end. This method avoids periodic expense fluctuation or variance.

All of the above are possible only using the posting to future periods and years of Ikonomikal. This will make the everyday work of the accountant easy and relaxing. Better for companies with only one or few accountants.


Please click also the following to know more about Ikonomikal
1. What is Ikonomikal?
2. What are the Security Features of Ikonomikal?
3. Ikonomikal Programming Language and Environment Diagram
4. How Robust is Ikonomikal?
5. Is 3rd Party Interface Possible in Ikonomikal?
6. Company website of Ikonomikal
7. Ikonomikal software site
8. How to Subscribe to Ikonomikal?
9. Ikonomikal Monthly Subscription Price List
10. Ikonomikal Monthly Subscription Price List with Daily Backup
11. Cost Savings in Using Ikonomikal
12. Improved Business Model in Using Ikonomikal
13. Return on Investment in Using Ikonomikal
14. Major Features of Ikonomikal

Suggested modifications, customizations and developments with general industry use will be done and corresponding upgrades will be deployed accordingly for free.

Click to email:Teodoro Rolluqui