Accruals - deal with an anticipated expense

Use the Accruals routine to budget for an expense that is normally paid for in arrears, e.g. gas and electricity. Based on an estimate of the expense, you can use the routine to account for the expense over the required periods.

The routine creates the journalA record that holds one or more transactions for posting. Synonymous with batch in batch processing. entries to account for the expense on the Profit and Loss and Balance Sheet over the given period. While the expense is shown in the Accruals account on the Balance Sheet it is classed as a liability that is increased as the periodic journal entries are added to it.

The routine also creates a final journal entry to clear the expense from the Profit and Loss and Balance Sheet accounts. When you eventually receive the actual expense it can be recorded on the ledger without the worry of it being accounted for twice.

When you create an accruals journal, any elements that are dated in future periods are held in the deferred waiting postings file. These posting will be transferred later, when those future periods are subsequently opened.

When creating the accruals journal the routine:

• Accumulates a total for each periodic posting. This value must match the total value for the expense.
• Applies only one URNThe unique reference number assigned to a complete transaction to assist in tracing the progress of the transaction through Sage 200. This number is 12 digits long and comprises of: 3 digits for the user number, 2 digits for the source module in which the transaction was created, and a 7 digit sequential reference number. to all postings made.

• A credit posting is made for each of the periodic amounts to the accrual account for each period involved and a corresponding debit posting is made to the expense account again for each period amount with the appropriate dates.
• The nominated accrual account is debited with the total amount of the accrual and corresponding double-entryA system of bookkeeping in which every transaction of a business is entered as a debit in one account and as a credit in another. As every transaction must have an equal or zero effect on both sides of the accounting equation, every positive amount entered (debit) must be mirrored by a negative amount or amounts (credit). is made by crediting the expense account concerned. This is performed by the last journal entry.