Job Costing - Accrual Transaction Processing

Overview – Accruals

The processing of accrual transactions is usually a necessary function at the end of each period to record unrecognized revenue and expenses applicable to that period.

It is required when a transaction begins in one accounting period and ends in a later one. Therefore, accrued revenue applies to revenue that has been earned during an accounting period, but not received and recorded because payment is not yet due. An accrued expense applies to expenses that have been incurred during an accounting period, but have not been paid and recorded because payment is not due.

Enterprise offers both manual and automated accrual processing. Automatic accrual reversals are controlled by a checkbox in Job Costing’s Control File screen, as well as an override option when posting actual transactions. The manual reversal of accrual entries is performed by selecting and posting the accrual transactions to be reversed.

Automated Accrual Reversals

A checkbox in the Job Costing Control File will turn on or off by default on the Transaction Posting screen that determines if accrual transactions will be automatically reversed.

If set to complete the automatic reversal, the posting of the transaction will automatically include the accrual reversals set for the first date of the following accounting period (month).

Although the Control File may be set to automatic reversal of accruals, this can be changed when posting the transactions to require the manual reversal of the accrual and vice versa.