USA Adjusting Entries for Prior Credits Not Yet Posted

[Strutte2]

Hi there,

Appreciate some insight on how to handle this situation.

I recently started working for a new company and am catching up on posting payments they received in prior months.

The accounting software they use (Britannia v5) does not allow me to backdate payments and create credits (to adjust invoices for fees deducted from payments) to when we actually received them.

This means when running reports we show that a large number of fees accrued over the past few months are all showing expended in the current month.

The software does allow you to make manual adjustments to the ledger so I had planned on simply crediting the misc fees in the current month and debiting them for the prior month, however the software will only allow you to use one date at a time, and you cannot create entries that don't balance.

My solution is to create an adjustments journal account and create two entries:

1. One crediting the Misc Fee Account and debiting the Adjustment account of the date payment was applied
2. One crediting the adjustment account and debiting the Misc Fee Account the actual date the payment was received

Is this a good solution? I'm thinking I may have overlooked something better.

Thanks!

Strutte2

 

[kirby]

That works. Now see if you can convince somebody to trash that ridiculous software.