Retrospective G/L Journals: V1.2007

Version Relevance: From V1.2007 onwards

Issue:Is there interim extra help section for the General Ledger Journals topic: Retrospective Journals (After Month-end).

Nov 12th, 2002

Feedback: There are occasions when it is appropriate to post adjustments to closed G/L periods. Typically at the end of a financial year, before the auditors descend on you, you want to close of the final month-end. However, after the auditors have finalised your accounts for the year their adjustments need to be applied retrospectively to the final month of the year. This process of 'auditor adjustments' is known in the program as Retrospective Journals.

Normally, when creating a journal you will not be able to select a period for that journal prior to the current G/L period. However, an Option is available that can be set in File -- System Manager -- Priviliges and Settings then System tab and Options tab. The optAcRetroJouUsers option can be set to a comma-separated list of users who are permitted to carry out Retrospective Journals. Those users are then permitted to select a G/L period prior to the current G/L period but later than the final period of last year. I.E. they will be permitted to apply the journal to any period in the current financial year. You can also set the date to any day after the last year-end. Normally you can only apply a date subsequent to the last month-end date.

When posting a Retrospective Journal the system records the journal and its transactions in the normal way. However, it then goes on to carry out the following extra adjustments:

  1. It adjusts the period-end history for the transaction account and period.
  2. For asset (balance sheet) accounts, it adjusts any subsequent closed period history to 'roll-forward' the changed account balance.
  3. For trading (P and L) accounts, it seeks to adjust the first balancing off period transaction and for that period adjusts the retained profit account. Where specific account-period transactions do not exist, they are created.
  4. Appropriate G/L balances and turnover figures are adjusted.

WARNING: Great care must be taken when using this feature as a number of assumptions are made which you should be aware of:

  • Any retained profit and loss adjustments are made to the current retained profit and loss account set in Ledgers -- Ledger Manager -- Control Settings - Defaults tab. If you have the practise of changing this account default after year-end, you should temporarily change it back before posting a retrospective journal.
  • If accounts are included that did not exist at the time the period was closed, for trading accounts their history may have missing records, which in terms of operation of the system and reporting is inconsequential.
  • When you view the audit trail of transactions sorted by transaction id you may see additional month-end transactions. This will appear odd, but is a consequence of including trading account transactions to accounts that had no previous activity for that period.
  • The journal number given is the next number in just the same way as a normal journal. This may appear out-of-sequence when viewed from a period or date perspective.

Chris Ross - Caliach Design