Sage 50 Year End Expenses

[baleler]

I would like to ask for assistance on Sage 50 year end accounting. I recently closed last years books ( 2010 ) and opened this years books ( 2011 ). There were some outstanding expenses which needed to be processed in last years' books ( 2010). If I book these expenses now; will they register in last years books? If they won't, what option do I have booking them in the correct period? Thanks in advance.

[brucedenney]

When you do your year end, any outstanding expenses are retained.

You speak of "closing" and "opening" and I am left wondering if you have started a fresh set of data rather than doing a year end.

Without really knowing what the position is, it is very hard to help.

[baleler]

Hi Bruce, the books are in the Financial year 2011 and I am trying to process outstanding 2010 expenses / invoices. Thanks.

[brucedenney]

I am still unclear.

Are you saying that you have done your year end and you have now found some invoices that relate to the previous year?

There are a couple of options.

1/ The amounts are small and can be absorbed in this year without materially altering things.

2/ The amounts are significant and they must be accounted for in the previous year but there are only a couple of things.

3/ The year end was done prematurely and needs "undoing"

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Sage is an open item accounting system the ONLY thing that determines the period that something goes in is the date. If you have done a year end and back date something it will become part of the "brought forward" period. If can not go in the previous year as the previous year is now the "brought forward" period.

Conversely if you post something that is in the next financial year, it become part of the "future" period.

At year end each period balance is recalculated so transactions that had been in the future balance are now moved to the balance for the appropriate period in the new year.

The "year end" process in Sage is only part of the year end process that we tend to do. If you have not cleared the audit trail, it is possible to undo a year end. To to this you need to reverse the year end journal and then alter the financial year back to the previous year, sage will recalculate all the balances for each period.

I would suggest that there are 2 common ways to proceed, enter the amounts in this year and back date them to last year, this will make them appear as brought forward balances. You can either exclude these brought forward figures from this year by manually adding them to the previous year and then deduct them from this year, you you can let them roll and be part of this year.

Which way to resolve this is up to you.

I think "Best practice" is to make sure you have all "material" expenses and income recorded before closing the year. If people are late submitting expenses then, you need tighten up your procedures to make them submit them on time, or pay the price. I know of companies that will refuse to pay expenses if they are submitted late. There are always the odd little bits that appear late, and that need to be accounted for, they can all be rolled into the new year. If there is a huge amount then, you could go to the auditors and have them make a provision for it in last years accounts and to remove that provision when they do this years accounts.