ACCRUE - TRADE Costs Accrual
What is ACCRUE
ACCRUE will calculate/report all the un-invoiced items for a purchase and sale pair which have been sales invoiced and have not been liquidated. This provides a more accurate P&L for sale invoiced contacts that have not yet had all their associated costs invoiced.
It simplifies the split between forward and realised. The clear line between forward items (these can be reported by using the VALUATION report, filtering on 0% sales invoiced contracts) and realised (which is reported in ); this is the production of M2M for F&O and TRADE which will then be posted manually using DOCENT, whereby the user dictates what accounts to post the results.
The accruals comprise the un-invoiced value of the purchase and sale (optional) and any un-invoiced costs and commissions (optional).
There is a feature to generate the TA documents (temporary adjustments) which will post between the WIP accounts and nominated accrual accounts in the NOM. This is actioned on a gross basis. The expense codes are according to cost type e.g. PURCH, SALE, COMSN and OTHER, that have been marked as ‘Include in P&L’. The +Option icon needs to be activated BEFORE creation of TA grid. This ensures correct Accounts and Expense codes are available for posting the documents. This feature also enables the company to determine which Cost types are consolidated and which are posted separately.
If the TA is requested, the detail and summary report are secured in OPRINT. TAs can only be created when reporting on frozen databases. The TA can be modified in DOCENT if they have not been authorised for posting.
The report can be filtered by the standard trade filters. Purchase and sale values and commissions can be excluded. The report can also be filtered by cost type.
There are 2 report styles, the detail will list 1 row per sale, purchase and the individual Cost rows. The summary will show all the costs as a single row.
When a TRADE has been invoiced and has been marked as Final Required, there will be a report item produced with the calculated accrue value, even if = ZERO
Note1: the WIP accounting control is a part of the PLR, so in order to adjust the month-end PLR, the user needs to manually reverse the Stock value from WIP to the BAL
Note2: When the company operation is a Refinery, Purchase trades where there is a Title transfer date will also be treated as being Purchase Invoiced and thereby will accrue their cost, if they are allocated and Sales Invoiced or transferred into Inventory..
IMPORTANT: Options Icon The options screen is used to set up the analysis and TA create static details e.g. expense codes and Nominal Ledger accounts. Individual Costs can either be reported separately or grouped as 'others'.