Closing months

Hello,

I am just wondering if there is a function in Adagio receivables and payable which would allow me to prohibit posting into months which are closed. I know that Simply Accounting has this function, but I have not been able to locate it in Adagio.

Thanks a million,
Jenni

Hi Jenni

AP and AR don't know about fiscal periods and their status. The only place where you can prohibit posting into closed months is GL, which actually has a fiscal calendar. Isn't that where it's important, anyway?

Steve

The closest function in AP and AR is a setting in the Compnay Profile that provides a warning if the entered date is more than xx days away from today (default 30).

I do have the warning message in Payables and Receivables enabled to the default setting... unfortunately since we do not have the ability to disable posting into a closed off month we are having occassional troubles in our GL when we have a temporary member of staff or a new member of staff forget and post into a closed off month.

Thanks a mill for your help anyways.

You shouldn't be having troubles in the GL if you close the period there. Closing a period in GL is reversible if you decide you do want to reopen it.

Hello,

Just wanted to say that I'm with Jenni on this. To my mind, the primary reason for "closing" a perion in GL's Fiscal Caendar is to prevent posting to the period.

I believe that if one has decided to "close" a period in GL, no sub-ledger postings should be allowed to that GL account, including the ability to prevent the posting in the sub-ledgers themselves.

My preference would be for the validation to start at the point of entering a transaction Date (GL and Subs) where not only the "xx Days from today" is checked but the GL Fiscal Period Status in the Fiscal Calendar would also be validated and an appropriate "warning" displayed.

The warning would allow for instances where users validly needed to post to closed GL periods, by allowing users to save (but not post/day-end[more validation]) those transactions until an individual with the appropriate GL security re-opened the Fiscal Period.

While I'm sure that Jenni and I are not aware of all of the implications/complexity of our wishes; we can dream :-)

Hi Peter

I guess we just disagree. What you are describing would not work in practice unless the AP clerk and the GL clerk are the same person. I can just imagine an AP clerk not being able to pay a bill using the right date because somebody closed a GL fiscal period. The uproar that would cause! The general theory about separation of duty is that an AP clerk should just be able to do his/her work, without having to think about GL implications (other than coding to the proper account).

The best practice is to print a subledger report that agrees to the GL balance right before closing the fiscal period. If you are afraid of losing the printout, print to file as well. What can be the objection to that, especially since there is no time restriction on how many days after actual period-end this can be done?

Steve

Hi Steve,

I do not think this is a matter of agreeing or disagreeing - I think it comes down to differences in what we need Adagio to do.

When something is posted in a month in the subledger for a month which has been closed in the GL the financials are skewed since the subledger does not have the ability to prohibit posting in closed months. This IS problem as once the month is closed in the GL the financials are sent to the bank and published and in Canada it is illegal to modify your financial records once they are published.

The 30 days notification is helpful, however when you have a temporary member of staff who is unfamiliar with all the functions, they will post in previous months as the ledger will still let them.

Closing a month in both the GL and the subledger is a very standard feature.

We are already changing invoice dates we receive once a month has been closed in the GL to a date in the current month in order to ensure our financials in the GL are not skewwed, this has not caused any problems. It does however cause troubles when someone posts something in a previous month as noted above. When doing AP we do have to be concerned with the GL and I find it very unfortunate that Adagio does not have this basic function in order to ensure financials comply with the laws in Canada as this software is sold here.

Jenni,

There are occasions where the subledgers are run in a different office from the Ledger. Thus, a common "Period close" would not work.

Do you think that a simple "Disallow posting before" date in Company Profile in Payables would work? It would have to be changed each month, but security could be set to only allow certain people to change it if that is an issue.


If so, we can suggest it to the programmers for a future release of subledgers, which is in the planning stages now.

A simple "disallow posting before" function would be absolutely brilliant! That is exactly what I am looking to do.

Ralph, you are a star!

Hello all,

Why not just have a "Disallow posting to closed period" option? or would you rather be able to specify a specific date?

There is a margin of error in using dates in that if the format is entered wrong it the prohibition of posting would be incorrect.

To have a "disallow posting to closed period" option would work in theory, as long as it was able to be revoked by an administrator in the system just in case something did have to be posted in a prior period.

I just spoke to our controller for her input as she has worked with numerous accounting systems, and she advised one system utilized check boxes to allow/disallow posting in particular months

ex: there would a be list of all months jan - dec with a box beside each one - boxes to be checked as months are closed/should not be posted in.

Hi Jenni,

Those check boxes for closing a period exist in Adagio Ledger in the "Edit Company Profile" function. However, as Steve pointed out, this only affects transactions being posted in Ledger. It does not prevent the AP clerk from posting an invoice into a closed period. The resulting G/L entries will not post in Ledger until the controller has made a decision about which period to post them into. The transaction fiscal period can be fixed either by editing the transaction or copying the error batch and updating all the fiscal period fields in the copy operation.

Our Adagio JobCost program has a feature where you can close particular date ranges (initially loaded from the Ledger, but can be customized to different ranges, even covering more than a single calendar/fiscal year). These ranges/periods are independant of the Fiscal Calendar in regards to open or closed status. Posting in Adagio JobCost can optionally adhere to these periods and refuse to post if any of these JobCost periods are closed.

Perhaps functionality like this might be what you are looking for?

I suppose part of this discussion hinges on when a controller considers the period Closed, what dates an AP clerk can enter transactions for, and whether it's more important to prevent the clerk from posting the batch, or allow them to post and have the controller force the entry into a different period.

Hello again,

We really were hoping that Adagio would have the function to altogether prohibit an AP clerk from posting into a close period. Another issue is future posting, however the warning while entering should minimize this, but we have had issues with it in the past.

I just spoke to our controller/CFO, and she advised as an internal control preventing a clerk from entering into a closed period is the best mechanism - she has worked with several accounting applications which allowed this.

Hello Jenni,

Preventing an AP clerk from entering an invoice received late late from a supplier would not work at all in some companies, for the reasons that Steve pointed out earlier. However, in others it would be useful. In my experience, only a small percentage of Adagio sites bother to close their periods in the general ledger to prevent posting into a period they consider closed.

Certainly, it would make sense to consider adding this functionality in the coming upgrades to the subsidiary ledgers. Thanks for sparking this interesting exchange.

Andrew, I agree this is a very interesting thread! We've had many instances where a period has been closed in AP and only by reviewing a vendor's statement are we aware of an invoice that we either have not received or has "fallen through our cracks". In either case, it needs to get into AP, and we need it entered in the correct period. I do however, think options are wonderful, and it's obvious by this discussion that different companies would utilize the options differently.

One of the best (in my opinion) that's been implemented was the date range functionality in Job cost that your Adagio support team reference in a previous response. It's made my life SO much easier!!!
By the way, we are one of the companies that does not close the periods in our GL.

Hi Karen,

I know that JobCost carries its own calender. Why is it useful to have that separate and distinct from the company fiscal calendar?

Ah....I was referring to the calendar that lets the user select a date before recognizing revenue and expense. Sorry for the confusion!

Hi Andrew,

It's great to hear that this is being considered to be added in an upgrade! I am not sure if you do a limited release to customers for trial upgrades, but if this this function is added I would volunteer to be a guinea pig.

Also to be considered perhaps is to added a parallel function in the ledger with the option of reopening months.

I was just conversing with the CFO again about this, and she advised me that especially because of the way in which the year is entered "07" that there has been errors (fake nails worn by our account administrators seem to contribute to this trouble!).

I was also wondering if there are ever any customer focus groups in the Vancouver area - I ask as I can see you are located in Vancouver. The CFO of my company and myself would both be interested in attending if you ever have events to obtain customer feedback as we do have noticed a few areas in Adagio which could be improved to improve Adagio's market share.

Thanks again for your help and consideration,

Jenni

Hello Jenni,

Adagio Ledger allows you to open and close periods at will. It's just a check box in the fiscal calender. Transactions applied to closed periods will not post and will be written to an error batch. Your CFO can decide whether to open the period and post them, or edit the fiscal period.

There is a whole day event planned in Surrey on October 30 to demonstrate what's been added to Adagio in the recent releases, and what to expect in Adagio Ledger V9.0 when you install it. The next release of the general ledger supports unlimited years of history (including the budgets and transaction details) and a "soft" year end. This is an all day training event including material and lunch for $395 (early bird registration).

If you have specific features that you are interested in seeing, then you can post them here or send an e-mail with your suggestion to me (Andrew.Bates (at) softrak.com). We are especially interested in improvements our clients would like to see in Adagio Receivables and Adagio Payables as we prepare for the Version 9.0 development.

I would just like to thank Jenni for finally getting the point across about closing periods in the subledgers. My attempt on this exact topic back on June 28th must have fallen on deaf ears. I guess that since no one could understand why I would want to close off the subledgers I let the topic die. Again, Jenni, thank you for pursuing this.

Hi Sonia,

Your thread didn't fall on deaf ears - in fact I said this would be addressed in the 9.0 releases as they came out. The date handling has to be done as an option because, as Steve pointed out early in this thread, there are some companies where this would be operationally impossible. The AP clerk needs to be able to date the invoice as it is received. It is the controller's job to decide what period to post the transaction to.

Adagio Ledger has been able to close periods since it was originally released in 1999, and ACCPAC Plus could before that. In my experience however, very few people find the time to edit the fiscal calender and actually mark the period as closed.

Perhaps we should have a menu choice that just performs that function?

Hello All,

Not being able to check in for a while, I was oblivious to all the great posts that continued on this topic. Jenni - does agreeing with you always cause this much attention

From the comments I'm seeing, I'm quite positive that we'll see an improvement in this area in the 9.0 versions

BTW - All sub-ledgers should have the "option" to restrict posting to closed GL periods, not just AP - and once it's only an "option" almost everyone should be happy because you can just leave it off if you don't want it.

Pete

Hey Peter, what a novel idea. Give people a "choice". I like your thinking.
I, too, haven't been checking the forums for a while, but I'll now make a point of checking in a couple times a week.

OK Guys - sorry for the redundancy in my previous post. I had not realised that the topic went to a second page in my browser.

BTW - Hope v9 will get to that Peachtree-like "Date Field" entry logic that I discuss with SteveW and/or Andrew at every AOCs since 2001...

Although a "disallow posting to closed period" could be used in some companies, I question its practical value.

Payables invoices are entered with their actual date so the aging and due dates are correct. Checks are entered with their actual dates so the bank account information is maintained correctly.

However, when the GL period is closed, any prior period transactions are not posted but moved to a separate batch, so the controller can chose how to post them. When financials have been published or sent to the bank, then these transactions would be recognized in the current period rather than the closed one. Since the payables aged transactions report would also have been done already and reconciled to the AP account in GL, the fact that these are dated earlier would have no impact.

They will impact the AP before the end of the current period and will impact the GL for the current period.

On the other hand, I would not like to see transactions assigned other dates in order to move them to other periods. I think this has the potential to create havoc with the books, and would raise many questions during an audit.

I don't have any problem with the way Adagio handles the fiscal periods and payables. I like that you can enter the actual date of an invoice and have it go into the next fiscal period if the one it applies to is closed.

We run a report when we want to close payables for the month and balance that with the ledger. After that when retrieving the payables into the general ledger we change from choosing the fiscal period by the date of the invoice to using the current period. Then at the start of the next month we change it to choose the fiscal period by the date.

In our case the AP clerk is the one going into the general ledger and doing the retrieval. So we're not changing anything in a "closed" period in the ledger anyway, and I'm not that concerned about it if we have to run any payables reports after the close either because we know it balanced.