Tutorial 14 - Zero Balancing

Balanced accounting transactions are a must, however achieved; this implies not only that the sum total of all debits (+) and credits (-) must equal to zero for a given accounting document but that each accounting period must also be in "zero-balance." Real life is not always that simple e.g. you may receive an invoice in February for services rendered in January. If you are "picky," you may want to record the expense portion in January and the liability in February. It can be simple and automatic with STEP FORWARD. Just record what happened, STEP FORWARD does the rest. That example makes use of one of STEP FORWARD's Zero balancing options, there are others for other situations.

The Zero Balancing feature deals with three possible scenarios:

1. Entity: Inter-Company or Inter-Fund accounting.
We will not use this in this Tutorial. It provides for automatic transaction generations (Due to and Due from accounts) and allows for "out-of-balance" transactions between legal entities or fiduciary relationships maintained in the same database,
2. Inter-Period Accounting (Cross-period Balancing).
Enables the entering of an otherwise balanced transaction over multiple periods which would cause the accounting periods to be out-of-balance - except for this feature which generates the necessary accruals in each affected period.
3. Profit & Loss.
Enables the closing of Revenue and Expense accounts at the end of the fiscal year without actually setting the affected accounts to zero.


Exercise 14 - 1, Selecting GL Account for Inter-Period Accounting
1. Launch the Prototypes function (unless you are still in it from Tutorial 13).
This will display the Account Component Tables window.
2. Select the Zero Balancing > By Period... menu item.
This will display the Balancing Period window with its default setting:

3. Select the Generate balancing entries automatically option from the Balancing Period window.
This will open up the bottom half of the Balancing Period window.
4. Select Code 324 (Description: Accrued Expenses).
The Balancing Period window should now look like this:



Exercise 14 - 2, Selecting GL Account for Profit & Loss Closing
1. Select the Zero Balancing > By Profit & Loss... menu item.
This will display the Profit & Loss window with its default setting:

2. Select the Set accounts for Profit & Loss balancing option from the Profit & Loss window.
This will open up the bottom half of the Profit & Loss window.
3. Select Code 499 (Description: Close Revenue & Expense).
The Balancing Period window should now look like this:


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  Tutorial 15 - Headers for the GL Accounts
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