Dynamics GP General Ledger Deferral Entry

By Tracey BrinkmanGeneral Ledger, Microsoft Dynamics GP, With 2 comments

Setting up revenue/expense deferrals.

Use the Dynamics GP General Ledger Deferral Entry for revenues and expenses to be reported in the time period in which they are earned or incurred.

Financial >> Setup >> Financial >> Deferral

Deferral Setup

Use this Setup window to specify the Next Batch Number, Source Document Code and Next Transaction Number.

Select the default method you want to use to calculate the allocations for deferral transaction amounts.

  • The Days in Period method apportions the amount based on the number of days in a fiscal period.
  • The Equal Per Period method allocates an equal amount per fiscal period.
  • The Miscellaneous method allows you to specify the length of the periods, and allocates an equal amount per period.

Choose Yes or No to:

Automatically Post Through GL.

Auto Post into Closed Future GL Periods

Auto Post Into Closed Previous GL Periods

Void Deferrals with Original Transactions

All User Access to Deferral Profiles

Choose Balance Sheet or Profit/Loss:

Sales Series Posting Method

Purchasing Series Posting Method

If you choose the Balance Sheet method, you will specify two posting accounts:

A Balance Sheet deferral account to be used with the initial transaction for the deferred revenue or expense.

A Profit and Loss recognition account to be used each period for the deferral transaction that recognizes the expense or revenue.

If you choose the Profit and Loss method, you can specify up to five accounts. This allows greater detail in financial reporting than the Balance Sheet method.

The accounts include:

Three Profit and Loss accounts:

1)      An account for the initial posting of the full amount of the original revenue or expense.

2)      An account used for reversing the deferred revenue or expense (this may or may not be the same as the previous account).

3)      An account used for recognizing he deferred revenue or expense (this may or may not be the same as the first account).

Two Balance Sheet accounts.

1)      A deferral account to record the full deferred balance (transferred from the original revenue or expense account).

2)      A deferral transfer account (this can be the same as the deferral account).

Refer to Help Text Illustrations for examples of posting examples in General Ledger.

                           Note:  Once you have selected a deferral posting method for a series and posted deferral transactions,  we recommend that  you not change the deferral posting method.

For Profile Distribution Account Override Options:

Choose Never Allow Override, Always Allow Override, or Set Override on Profile

Follow instructions from Help Text for additional instructions.

 General Ledger Deferral Entry – Using a Profile, Setup and Transaction

Setting up a Deferral profile allows you to ensure that similar transactions are entered with consistent information. The profile specifies the accounts to be used as well as the method used to calculate how the deferred revenue will be recognized.

Setting up a Deferral profile.

Set up profile templates using Deferral Profile Maintenance. (Financial >>Setup>>Financial>>Deferral Profiles)

Deferral Profile Maintenance

You can set up profiles for transactions originating in General Ledger, Receivables Management, Sales Order Processing, Payables Management and Purchase Order Processing.

Follow these steps:

  • Open the Deferral Profile Maintenance window.
  • Enter a name for the profile. For example, CONTRACT.
  • Select the module(s) that will use this Profile.

To select multiple modules, hold down the ctrl key while clicking the modules.

  • Select the distribution types needed for this profile. For example: Sales, Service, and MISC.

To select multiple distributions, hold down the ctrl key while clicking the distributions.

  • Select the accounts you want to use to defer and recognize the revenues and expenses. Depending on the option you selected for overwriting distribution accounts in the Deferral Setup window, you may be able to mark the option to enable an account to be changed.
  • Select the method to calculate the deferral amounts across each period, the date of the first allocation, and the number of fiscal periods to allocate the transaction over. If you leave the start date or number of periods blank, you’ll need to enter a start date and number of periods when you use the profile to defer a transaction distribution.
  • If you chose to limit access to profiles to specific users or user classes in the Deferral Setup window, choose User Access to select the users or user classes who can use this profile.

See (Setting access to a deferral profile) for more information.

  • Choose Save to save this profile.

 

Entering a General Ledger Deferral profile transaction.

Financial >> Transactions >> Financial >> Financial Deferral >> Deferral Profiles

Deferral Profile Document

  • Enter or select the profile you want to use for this deferral transaction.
  • Profile Deferral Entries can be entered in a Batch. Specify GL Profile Deferral for the Origin when creating the batch.
  • Enter the amount to be deferred, the batch for this transaction, and a reference.

Depending on how you have set up the deferrals feature and the options for access to the profile, you may be able to change:

  • Deferral and recognition accounts
  • calculation method
  • period information
  • Each period’s transaction information for this distribution deferral.
  • Enter the amount to be deferred, and the recognition and deferral accounts.
  • Choose Save to save the transaction

You can also enter Deferral Transactions without using a Profile.

Entering a General Ledger deferral transaction

Use the Deferral Document Entry window to enter a deferral transaction directly in General Ledger. For example, you can use this window to create the deferral transactions for an amount that has been posted to a deferral account.

When you use the Deferral Document Entry window, you will specify the deferral and recognition accounts to use, the beginning and end dates for the deferral, and the method for calculating the deferred amounts. If you want to ensure that similar transactions are entered with consistent information, you can use a deferral profile described previously.

To enter a General Ledger deferral transaction:

Open the Deferral Document Entry window.
(Financial >> Transactions >> Financial >> Financial Deferral >> Deferral Document Entry

Deferral Document Entry

  • Enter the beginning and end of the period, and select the method to use for apportioning the deferred amounts over the period.
  • Enter a GL Reference, and enter or select a batch.  (Origin GL Deferral)

Deferral Batch Entry

  • Enter the amount to be deferred, and the recognition and deferral accounts. If necessary, you can change which account will be debited or credited by clicking the Dr/Cr buttons next to the account field.
  • The individual deferral transactions will be calculated and appear in the lower scrolling window. If necessary, you can edit the date, description, and amount for each deferral transaction.
  • Choose Save to save the transaction.

Note: If you do not see Financial Deferral listed on your Financial Series menu, it has not been installed.  Give us a call regarding installing this feature.

If you have any questions regarding Deferral Entry, please contact us at:

support@iSolutionspartners.com