|article ID: 1005738||last updated: Wednesday, September 12, 2007|
Moving from one accounting year to another involves the use of distinct procedures, designed to ensure that the correct time-boundaries remain between entries from one year and entries from the following year. Mamut is designed to allow the most flexible transfer to a new accounting year possible, while ensuring that the data is entered to the correct accounting year.
It is often necessary to be able to continue recording into accounting year 2006 after the commencement of accounting year 2007. The reason for this is that there will always be a delay in administrative routines including, for example, invoices for stock that is delivered in the end of the old accounting year but invoiced a short while into the new year. It will occasionally be necessary to transfer the settlement figures some time into the new year. At the same time, this must not hinder the daily bookkeeping from continuing as normal. You can not risk postponing bookkeeping in the new accounting year until one or two months later, when the previous year’s settlement is finalised. This is solved in the Accounting module because you are able to crossover from one year to another but still enter into both accounting years at the same time. This provides a great freedom during year-end without the new accounting year being jeopardised.
The accounting year is concluded first when all the postings are in place, and outgoing balances for the old accounting year are transferred as the incoming balances for the new accounting year. After the year-end is finally undertaken, is it not any longer possible to enter or amend the data in the old year. That accounting year is now closed. Should circumstances change later, and an item that really should belong in the 2006 accounting year becomes apparent, it is only possible to enter make correction postings in the new year. These security steps are necessary to ensure accuracy of balances passed from one year to the next.
The accounting module within Mamut has 13 accounting periods. Period 1 to 12 represent the twelve months of the year. Period 13 should be used to post year-end adjustments.
The accounting module is designed to provide the user the most flexibility possible when transferring to a new year. Create the new accounting year by choosing View/Settings and then click on the Accounting button. The active accounting year is shown within this window, and a new accounting year is created by clicking on the New button. When creating a new accounting year within Mamut Business Software, click OK to confirm the year start and end dates. The new year will now be visible in the Accounting Year section of the window. If you wish to commence entry into the new year, set it as the active year using the field at the top-right of the window. The important consequence of moving the active year to a new year is that accounting transactions become posted in that new year, but at the same time as the user has the opportunity to go back to the previous year to finalise it. This provides the user with the possibility to enter into two different years at the same time. Below is an explanation of how the two Sales/Invoicing and Purchase modules identify which year entries should be posted to. It will always be that the year that stands as the active accounting year that will become suggested used in all the other modules. For this reason it can be best practise to set the new year as the active year as soon as the emphasis moves from the old year.
It is possible within Mamut Business Software to control which period and year an invoice should be recorded into by entering the Invoice Date field in the Sales/Invoicing module. If nothing is entered into this field, it is the current date that is used.
TIP: If you are entering a number of invoices with the same invoice date, you can set the system date to the desired date. This is done by choosing File/System Date. Remember to set the system date to the current date when you have finished processing this group of invoices.
This module uses the system date to assign the period and accounting year. If you wish a different date from the current date, you can amend the system date by choosing the menu File/System Date, setting the desired date here.
TIP: Remember to set the system date to the current date when you have finished entering back-dated purchases.
You are free to choose the accounting year and period within Journal Entry. The year must be selected before the journal is created, by clicking on the Choose Accounting Year button, and you will only be allowed to select an accounting year that is already set up. If you do not find the appropriate accounting year, you can create it via the View/Settings menu, clicking on the Accounting button and then clicking on New. With the correct accounting year is showing, click on the New button to create a new journal. Select the journal type and enter a date into the Date field. The system will use the date to calculate which period the journal belongs within, although this can then be overridden. If the period has already been closed you will be notified by a warning message. You will also be warned if the date is outside of the accounting year.
As a default, all journal types have their own number series within Mamut. This can, however, by amended to ensure that all the journal types share a common number series. These number series are automatically reset to 1 at the start of every new year. It means that the user does not need to remember to do this before the different modules are taken in use in the new accounting year. If, however, you wish to continue the number series from the previous year, you must enter the last used numbers as the numbers to continue from in the new year - then the number series in the new accounting year will continue from where the previous year concluded. This is done by choosing View/Settings and clicking on the Accounting button. Choose the Accounting Settings tab and click on the Journal Type Settings and Number Series button. Select the Series of Entry Numbers tab and, as long as the journal type is not in use in the new accounting year, it will be possible to change the number under the First Number column.
TIP: Transferring balances from the old accounting year to the new accounting year generates an Opening Balance journal. As the Opening Balance journal will then be active, the First Number value cannot be amended. If you wish to continue the number series from the year before, update these values before transferring balances from the old accounting year to the new accounting year.
The other number series, for example Order Number, Invoice Number and Customer Number, will continue from the final number allocated in the previous year. In other words, these series cannot be reset. This is because these registers do not have a clear distinction between accounting years.
Once period 12 is finalised, the next period that can be concluded is period 13, which is closed when the year-end process is run. An accounting year has 13 periods to allow the final modifications to be made during the new accounting year. It is common for these final amendments to finalised three of four months into the new accounting year.
The most important postings that must be run in period 13 are time-specific postings (depreciation, stock-taking, sales, etc) and capital appropriation of the years profit or loss. Most users can only finalise these entries with the assistance or their auditor.