This add-on module enables you to distribute expenses (e.g., insurance premiums, rent or lease agreements) over several periods. It is also used to capture deferred revenue.
According to the accrual basis, economic events must be recognized at the time they occur, regardless of the actual cash transaction. Therefore, it is necessary to differentiate between:
when the economic event is paid or charged
when the expenditure or income occurs
Accounting accruals allow you to classify and account for expenses/income in the corresponding fiscal year, according to when the expenditure or income occurs. With this Reviso add-on module, the distribution of expenses or income into the corresponding period is done automatically. Example: Imagine that we subscribe for an annual insurance starting from July 1 and finishing on June 30. Reviso will automatically create an accrual, which accounts the expenditure corresponding to the months from January to June of the following year instead of the current year.
How much does the prepayments module cost?
This add-on module costs additional £5 per month. It is disabled by default, so in case you wish to activate it, please do so as indicated below.
If you want to try this feature before purchasing it, you can do so by contacting us and we will enable a trial version for you.
How to activate the add-on module of prepayments?
The subscription module can be activated by accessing Settings > All settings > Subscription > Additional modules.
Find Prepayments in the list of add-on modules and click on the Edit icon on the right side of your screen, then check Access and click on Save.
Once activated there is a small amount of setup in order to use this module. If you are entering your sales transactions via the menu option Manual Invoices you can go straight to Step 5 and if you intend to use this for your supplier invoices go to Step 6.
Step 1
If you are using the Prepayments to portion your sales invoices (created in Reviso) then you will need to enter a code within the product group setup as shown below, in a default setup this would be 2110 ‘Deferred Income’ alternatively you can create your own account. Once your sales invoice is booked the net amount will be charged to this account…..
Step 2
Create your sales invoice, click on the Accrual box and enter the start and end date the charge relates, in the example 01.05.19 to 31.10.19 (6 months)
Step 3
Once the invoice has been booked you will see the total amount listed within account 2110, all that’s left to do is to ‘run’ your Prepayments normally at the end of each month, this will then enter a proportion of the Prepayment to your sales account leaving the balance in account 2110 until the next month when you repeat the process….
Step 4
In order to process the Prepayments/accruals, and we would suggest this is completed at the end of the month you will need to Go to Finance > Accounting years > locate the year you are working in and click on Periods….
This opens up the months within your financial year, click on the far right icon ‘Process Prepayments….
You can adjust the text to show various combinations of text, entry number etc, then select Show this shows the transactions that will be booked, if you’re not happy with the text you can then go back to the first screen and change, then click show again, once happy click on Book entries top left hand corner, the entries will then be booked/posted to your accounts.
Step 5 – Manual customer invoices
When processing a manual customer invoice and you have activated Prepayments click on Accruals enter the code you wish the net amount to go to on your balance sheet (default is 2110 but you can create your own) then enter the date parameters the sales invoice covers, you can then go to Step 4 above which shows you how to run and post the Prepayments at the end each month….
Step 6 – Supplier invoice prepayments
To use Prepayments for your supplier invoices, once the Prepayments module has been activated enter a supplier invoice, click on Accruals, enter the account you wish the net amount to go to in the balance sheet (1102 in a default setup), enter the date parameters the charge covers. Once your entry has been booked and you are ready to process the Prepayments then go to Step 4.
