Hi all
Can anyone explain their system for managing accrued expenses?
i have a situation where i have expenses accrued up to 12 months in advance of being invoiced accross alot of suppliers
So i cant simply reverse out the accrual as the following months expenses for that account would be understated
I need to figure out a system to know when the invoice has come in against the accrual and i can then act and reverse out the accrual entrie(s)
Is there a reconciliation proforma i could use each month vs a list of accruals i am logging in s spreadsheet?...
Please help, i need to act fast on this
Cheers
Andy
I use spreadsheets, separate out each expenses to be accrued and actually have a different nominal/expense code for each one so I can view them more easily. I use sage so I can just add a digit to the normal accruals code to expand the nominal range. For things like eg accountancy fees I post the invoice directly to the accrual code so I wouldnt need a spreadsheet for that and wouldnt need to worry about reversing the accrual as the posting clears it out.
I think I would double check that your accruals are being done correctly if you have so very many that are accrued so far ahead, although I appreciate some business sectors may need to do that.
__________________
Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
