AR Reconciliation

[swabunn]

How can we reconcile AR, if users are applying or reapplying cash receipts to previous years period and taking discounts and doing write off because as I understand AR TB does not pick up previous years transactions but it is posted in current period for write off's , discounts

Thanks

-Swabunn

 

[VictoriaYudin]

I am not sure how posting a discount or write off in the current period impacts you reconciliation - if the AR subledger and the GL are both updated with the same transaction on the same date - what is the issue? Or am I missing your point? If so, maybe you can give a specific example?

 

[swabunn]

for example if I apply payment to invoice relates to previous period/year and have gl posting date to previous period and give discount/write off to invoice or exchange gain/loss occurred. the portion of writeoff/discount or exchange gain or loss shows in (historical aged trial balance) the period when invoice was posted, not date of gl posting date. thus if I am printing AR TB for current period then write off/discount or exchange gain etc does not shows in the period when payment was posted (gl) rather it shows in period when invoice was posted but whereas in gl it shows in current period.

hope I am able to explain

thanks

-s

 

[VictoriaYudin]

You're saying when you're applying a payment you're changing to Apply Posting Date to the date of the invoice instead of the date of the payment? If so, that's not really the correct way to do it, for a number of reasons, including causing reconciliation issues. I would always make the Apply Posting Date the same as the payment GL posting date.

Or am I misunderstanding what you're saying?

Victoria

 

[swabunn]

when payment is applied, it has same date as GL Posting date and apply date i.e. current period. As you know, payment is applied to number of invoices incluidng relates to previous periods. what is happening if any discount/write off is given on the invoices relating to previous period or exchange gain/loss occuring in multicurrency invoices. the historical Trail balance report ,though write off/discount has current GL POSTING DATE is printing write off/discount amount in the period of GL posting date of INVOICE rather than GL posting date of payment applied or payment posted.and I am printing hist TB with OPTION using GL posting date.

thanks

-S

 

[VictoriaYudin]

The discount and write off will use the Apply Posting Date to post to the general ledger and the Apply Date to post to the receivables subledger. Both of these should normally be the same as they payment date.

I think the problem is actually with the report you're using - have you tried the Historical Aged Trial Balance? If you enter a date prior to the payment date in the Print/Age as of field you should see the invoice there without any writeoffs or discounts. I just tested the following:

- Entered invoice dated 3/12/07 for C$10700
- Entered payment dated 4/12/07 for C$1000
- Applied payment to invoice with Apply Date and Apply Posting Date as 4/12/07, entered a discount taken of C$500 and a writeoff of C$700 when applying
- When I print the Historical Aged Trial Balance as of 3/31/07, I get a balance of C$10700 for that invoice
- When I print the Historical Aged Trial Balance as of 4/15/07, I get a balance of C$8500 for that invoice

Victoria