Prepaid Expenses

Training Outline

Definition:

Prepaid Expenses are future expenses that have been paid in advance. Each month, the credit union can allocate how much should be placed in the expense GL to cover the future cost of this product. Expenses such as property taxes, annual league dues or marketing expenses are covered in these prepaid items.

The prepaid expenses are run by categories, which can then be assigned to an expense and adjust the appropriate GLs. Since the category drives the GL, several categories may be set in order to handle branch accounting.

Prepaid Expenses should be run monthly (on the last day), as similar to the Fixed Asset process. A report can be run to see what will be expensed before final processing. At processing, GL (except for those set for Accrual) will be posted automatically.

Roles:

Navigations

Prepaid Expenses

Permissions

Reports Available:

Prepaid Expense Valuation

Prepaid Expense by GL Account

Prepaid Expense by Purchase Date Closed Prepaid Expenses

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Prepaid Expenses

Procedure:

• Navigation: F3- Prepaid Expenses: Prepaid Expenses
  

All prepaid
			Details of
items
		prepaid item

History of

prepaid item

To FILTER prepaids,

select the FILTER (or

reset) button

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Prepaid Expenses

Select from available options to FILTER.

This is the only option to show disposed

prepaid expenses.

If RUN PERIODIC EXPENSES was selected, the

details for all posting will appear. Select PERIODIC

EXPENSE REPORT and then POST

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Prepaid Expenses

Example of Periodic

Expense Report

History example after

POST

The prepaid details also have an

EXPENSED THRU date that is

populated when POSTED.

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Prepaid Expenses

If ADD PREPAID EXPENSE was selected, the

workflow will appear.

DESCRIPTION: free form text field for Prepaid

description

CATEGORY: select from categories configured by

the credit union

DATE OF PURCHASE: enter date, will default to

current date

START EXPENSE DATE: enter date in which to start

expense, will default to current date

PREPAID LIFE IN MONTHS: enter number of

months

VALUE: enter value

ACCRUAL: check box to start at ZERO and go up

(instead of the opposite for a typical prepaid item;

no GL entry made when processed)

NOTES: add any free form text notes

NEXT to continue.

Use the ADD button to

complete the addition of the

prepaid expense.

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Prepaid Expenses

Create either a GL entry or a check to credit the prepaid

expense. When the balance is 0.00, hit COMPLETE.

All details will be displayed

regarding the new prepaid

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Prepaid Expenses

The MORE drop down will have PREPAID

CATEGORIES, CLOSE YEAR, & REPORTS.

CLOSE YEAR cannot be completed until

AFTER December has been processed

PREPAID CATEGORIES attach the prepaid to the GL Accounts. Enter a DESCRIPTION, (check box for inactive- cannot delete), and a GL for prepaid, accumulated expense and expense. Hit SAVE to create category

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Prepaid Expenses

All reports will generate and be stored in the REPORT WAREHOUSE

Example of Prepaid Valuation

Example of Prepaid Expenses by GL

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Prepaid Expenses

Example of Prepaid Expenses by

Purchase Date

For Disposed Expenses, enter a start/end date and select PRINT

Example of Disposed Expenses

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Prepaid Expenses

To make a manual adjustment to a

Prepaid Expense, in the details section hit

ADJUSTMENT

ADJUSTMENT TYPE: Book and

Original Value or Book Value

DRAW CHECK: select for check

GL OFFSET: select GL (if not

check)

INCREASE/DECREASE VALUE:

enter dollar amount

MESSAGE: enter free form

message

POST to complete

If the adjustment was made effective a different posting date, the GL System posting date must also be manually updated.

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Prepaid Expenses

If check selected, enter dollar amount

and hit ellipsis to enter check details

From the detail MORE drop down, AUDIT

INFORMATION and DISPOSE PREPAID are

available

Example of Audit Information

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Prepaid Expenses

To Dispose and make closing

entries, enter CLOSING NOTES

and hit POST

The EXPANDED VIEW of the detail provide

information (can edit fields). Hit SAVE or

CANCEL to exit edits.

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