Disbursements, automatic or manual, and two-party accounting documents contain Service From and Service To Dates for users to enter a period of time where goods or services were received. For those documents that are manually entered, Service Date entry is strictly a user responsibility with only a Document Control, called Service Date Severity, for requiring data entry verses defaulting to the Record Date of the document.
Accurate cash expenditure can be done on MD, IET, PRCI, and ITA documents with users entering the portion attributable to the prior year on an accounting line with that prior fiscal year and an accounting period, while entering the portion attributable to the current year on a second accounting with the current fiscal year and accounting period. Such data entry is only feasible when there are one or two accounting lines to split. Documents such as the AD and PRMI do not have this manual option because both are created by the application and are not editable. Use of service dates and the Automated Accrual Clearing batch process is an approach that requires less work of the user. For the AD and PRMI, use of the Automated Accrual process is the only option.
The Automated Accrual Clearing batch process will select cash expenditure journal records with a Service From Date prior to the current accounting fiscal year and create Automated Accrual Clearing transactions using the delivered ACLA document code to move the appropriate cash expense amount from the current accounting and budget fiscal year to the prior years. Selection is not restricted to just the first document version but subsequent modifications and even a cancellation will be selected to adjust accruals as necessary. Modifications of amounts down, changes to move the Service From Date forward, and cancellations will result in cash expenditures being reduced in the prior year, which is the opposite from normal accrual clearings.
One Automated Accrual Clearing (ACLA) will be created for each service date range found for a document. Documents created will memo reference the cash expenditure document to tie the two documents together for reporting and querying by the Accrual Inquiry (ACRI) page. The ACLA will also update the referenced accounting line with the percentage accrued into the prior year.
Two accounting lines are required to perform the accrual, one for the prior BFY and one for the current BFY. Unlike ACCA documents, the ACLA will have the current fiscal year and accounting period on both accounting lines. The sum of the two lines will always be zero, so all ACLA documents should sum to zero. No COAX functionality is required with the current fiscal year on both accounting lines. However, the prior BFY accounting line will use the current FY, so the situation of FY>BFY on this accounting line will require COA to be defined in the current FY if not budgeted for in the current BFY.
When the cash expenditure came from a disbursement referencing a payment request, each of the two accounting lines will have an additional debit and credit posting to reverse the previous accrual for accrued expenditures.
The process uses the Automated Accrual/Accrual Clearing Exceptions (ACRE) page to exclude activity that should not be accrued. One record delivered on the ACRE page should be left on the page for accurate accruals:
Exclusion of posting pair A (seller/provider) entries for the document codes: IET, ITA, PRCI, and PRMI so that expenditure credits on these are not accrued. The reason is that expenditures made by the seller/provider for goods and services were accrued as necessary before the internal sale was completed.
If internal cash expenditures are to be left out of the clearing process, then the input batch parameter for cash expenditures should not list any internal posting codes and only the external one(s). Another input batch parameter can be used to omit internal expenditures as well as manual disbursements that did not have a payment request. The Select Non-Referencing Documents parameter has to be set to ‘Yes” in order to select such documents.
When it comes to the selection of disbursements that have a reference to a payment request, if the payment request has not also been accrued, the Accrual Clearing process will write that disbursement to the Accrual Clearing Maintenance (ACRM) page with a Status of Process. Subsequent runs of the clearing process will try to re-process that disbursement. If a user changes the Status on ACRM to Held then subsequent runs will not try to reprocess the disbursement. A third choice of Delete is available that will trigger the next clearing run to delete the ACRM record if the batch job is configured (input parameter) to do so.
The Automated Accrual Clearing batch process is a chain process consisting of four batch jobs:
Clearing Preprocess – finds qualifying entries per parameters; excludes records that match records on the Automated Accrual/Accrual Clearing Exceptions (ACRE) table; and selects or deletes records from the Accrual Clearing Management (ACRM) table.
Create Clearings – creates the ACLA documents with a Status of Ready for the load process.
Load Clearings – Submits the documents and creates an exception file.
Exception Report – Accrual Clearing documents that could not be submitted to Final are written to a report