Hi,
We have a new client that is using 13 fiscal periods with each fiscal period being 4 weeks, for comparative fiscal period reporting that is very effective for everything except periodic VAT tax reporting (HST reporting in Canada, although I expect others have similar issues in other jurisdictions).

The site uses Adagio GL, AR, and AP. Their billings come from various 3rd party solutions from multiple store locations. We recently changed the data entry process so that the entry and imports into Adagio AR are using distribution codes with tax included to minimize the key strokes of data entry. However, they can still use the GL accounts for entering the revenue account distribution and HST payable.

And with AP, we changed the distribution entry to taxes included to minimize the data entry of the input HST tax credits (recoverable).

We have separate GL accounts for the HST input taxes recoverable, and the HST taxes payable. At the end of every fiscal period, they can see the net amount of HST payable, but the fiscal periods do not match to the filing period of the regulatory tax filings.

When we run the tax reporting in AR and AP, you get all distribution codes or you can select a range. Regardless, we have attempted to match the tax reporting to the fiscal period date range of the 13 periods, and the reports do not match, which makes us believe that there probably are situations where the people are entering revenue with distributions in AP and AR without distribution codes. The amounts are not out more than 10% (plus/minus) but still out and reconciliation is a huge task because of the volume of entries on the tax reporting. We have looked at the subtotals of the distribution codes (over 25) and the numbers do not jump out as the reconciling amount. We don't normally put a lot of faith in the Adagio tax reporting in the various modules because there isn't any central tax reporting that covers AR, OE, AP, and PO together (and we're not complaining) but we did look at 4 months and could not make the date ranges amounts match to the fiscal reporting in GL (and we're pretty good with numbers.)

The GL batch retrievals are all distributed to fiscal period by date, so this isn't a case where the period is overriding the source entry date into the fiscal period.

If we could get the tax reporting in AP and AR to balance, we would have a solution but we cannot enforce all data entry (persons) to use distribution codes. (a limitation within AP and AR, but we're not complaining). If we could use the GL as the filing source (net of the 2 accounts and financials for support), that would be easy except that the tax filing (reporting ranges) dates are normally month end dates and these dates do not match to the client 13 fiscal periods. (rarely ever).

Does anyone know if there is an exemption or filing election that would allow a company with 13 fiscal periods to file regulatory reports using say the closest fiscal period? We know for Income Tax reporting, we are fine with the fiscal periods for installments and year end filings, but this is another government agency and jurisdiction.

There are penalties and fines for under remitting, so we are suggesting plugging an accrual estimate (educated guess) for the payable and the sales base (required) for the stub period (as much as 2 weeks) as an easy way to resolve, but the client is reluctant to submit regulatory reporting that is asking for a certification as being correct. We don't have a problem with it, because we look at as another situation of accrual accounting.

Changing the fiscal periods back to 12 month ends is not an option.

Prior to using Adagio, they were using that other accounting system (Excel) as their labour intensive method to report the regulatory tax filings. We would prefer to move away from that.

For the tax jurisdiction in question, the client files quarterly on a calendar basis.

I suppose we could sell them Gridview and create a view that could be more effective than the AR and AP tax reporting?

Does anyone have experience or a work around solution other than the suggested above?

Thanks,
Brian

Hi Brian:

I hesitate to suggest this because you have likely considered it already. However, if the figures in the GL are correct, would the GL Source Journal report help? It allows selection of transactions by date range rather than by Period.

Thanks, Bruce.
We have looked at the posting journal but seems like a long way home to correct what there should be a practical solution for a reporting requirement.

I think we are going to suggest to client that they use the next fiscal period after the required reporting period date for reporting and filing, and see if that flies.

I will contact the taxation jurisdiction for guidance.

Brian

Hi Brian,

Bruce is suggesting that you create the necessary report using a Source journal (an infrequently used custom reporting tool in Ledger), not by doing anything with the Posting Journal.

Brian:

In AP use the distribution codes to report Input Tax Credits. The reporting is date range dependent, not fiscal period dependent.

In AR it depends upon the invoice tool, they all have tax reporting that is not period dependent. If not using an Adagio invoice tool then AR distribution codes will do the same thing as AP's.