The Attivo Blog

On a calendar year?  Using Macola ES?  Time to run a few extra closing procedures as you close the month of December, and the 2009 year.  Regardless of which version, you must first run the entire month end closing procedure.  If you don't have a month end closing procedure, please contact us and we'll gladly send you one. It is critical to perform these procedures in a timely manner, or the year to year comparisons, accumulators, etc. will not be updated or reset for the coming year.

Order Entry Year End Checklist

Order Entry is usually the critical package for most companies as sales staff will begin getting an "Out of Period" message on the first day of the next accounting period. Orders can be entered, printed, selected for billing, and invoices printed in O/E without closing the period. Period-End processing must be completed before any posting occurs for the new accounting period.  Timing of Year End Process:  Must be run before any transactions are posted for the next month. This includes O/E Orders posted to A/R. Step 1 Change the history period date to the current period that you are closing. This is the year-end option.  (System, Period-End/Year-End, Order Entry, Year-end procedure) Step 2 Close the period for the Order Entry journals specified in Source Journal setup. Open the next period.  (System, Company, Package settings, Source Journal setup, G/L, Maintain, Period-date calendar)

Accounts Receivable Year End Checklist

Timing of Year End Process:  Must be run before any transactions are posted for the next month. This includes O/E Orders posted to A/R.  You need to run the clear accumulators processes in Inventory Management as soon as possible after the end of a fiscal period. If you do not complete this process before you complete any of the above transactions for the new month, the values captured will be distorted. You must print any reports you need that reflect these numbers before clearing accumulators. Note: Finish the A/P Year End Checklist before clearing tax accumulators. Step 1 Clear tax accumulators for the period. G/L, Taxes, Clear PTD/YTD tax accumulators Step 2 Close the period for the Accounts Receivable journals specified in Source Journal setup. Open the next period.  (System, Company, Package settings, Source Journal setup, G/L, Maintain, Period-date calendar) Step 3 Clear tax accumulators for the period.

Inventory Management Year End Checklist

Timing of End of Year Process:  Must be run before any transactions are posted for the next year. This includes inventory transactions, O/E orders posted to A/R, P/O receivings, POP production reported, and SFC production reported.  You need to run the clear accumulators processes in Inventory Management as soon as possible after the end of a fiscal period. If you do not complete this process before you complete any of the above transactions for the new month, the values captured will be distorted.  Warning: Clear Inventory accumulators only once, Macola ES will advance the period each time you clear the accumulators.  Clearing inventory accumulators is date sensitive. The Clear Inventory Accumulators process uses the system date as the date from which to clear accumulators. If you are clearing accumulators after the actual end date of the period, contact the Attivo support department for assistance.  Step 1 Make sure all Inventory Management reports have been printed.  (System, Period-End/Year-End, Inventory Management) Step 2 Clear Inventory Management accumulators for the year.  (System, Period-End/Year-End, Inventory Management, Clear inventory accumulators) Step 3 Set the beginning balances with the first day of the new period.  (System, Utilities, Distribution, Inventory Management, Beginning balance records) Step 4 Close the period for the Inventory Management journals specified in Source Journal setup. Open the next period.  (System, Company, Package settings, Source Journal setup, System, Financial, General ledger, Codes, Period-date calendar)

Payroll Year End Checklist

Step 1 Print W-2s (PR & HRM, Payroll, W-2 Printing) The W-2 Printing process provides all necessary income and withholding information on standard W-2 forms. The instructions for printing W-2s are part of the supplemental year-end documentation provided by Exact Software each year.  W-2 processing can create a paper copy for the Social Security Administration (SSA) and the SSA "A" information required on magnetic media for those employers that have obtained approval to table in this manner.  Note: DO NOT process any new year payrolls before printing W-2s and/or clearing YTD accumulators.  If necessary, the "live" data can be moved to a test/temp directory and the YTD accumulators cleared in the "live" data directory to be able to process new year payrolls.  Step 2 Clear Year-To-Date Accumulators  (System, Period-End/Year-End, Payroll, Clear accumulators) Step 3 Close the period for the Payroll journals specified in Source Journal setup. Open the next period. (Setup, Company, Package settings, Source Journal setup, G/L, Maintain, Period-date calendar)

Purchase Order and Receiving Year End Checklist

Timing of Year End Process: Must be run before any transactions are posted for the next month. This includes PO Receiving.  Delaying the closing of Purchase Order and Receiving and Accounts Payable will skew vendor performance accumulators and is not recommended. Step 1 Complete A/P and I/M year-end checklists.  Step 2 Close the period for the Purchase Order and Receiving journals specified on the Source Journal Setup screen.  Open the next period.  (System, Company, Package settings, Source Journal setup, G/L, Maintain, Period-date calendar)

Accounts Payable Year End Checklist

Timing of Year End Process:  Must be run before any transactions are posted for the next month. This includes P/O receivings, A/P voucher processing, check runs, etc. Step 1 Print and Create 1099 Forms at Calendar Year End Step 2 Print all reports used to analyze your annual data.  Step 3 Close the period for the Accounts Payable journals specified in Source Journal setup. Open the next period.  (System, Company, Package settings, Source Journal setup, G/L, Maintain, Period-date calendar Note: You can continue processing A/P transactions before printing 1099s. The Print 1099 and Create Disk functions allow you to select the set of data to be used. If you have not closed the year, print and create 1099s using current data. If you have already closed the year, print and create using last year's data.

Assets and Depreciation Year End Checklist

Step 1 Use the Evaluation report to analyze and repair any discrepancies (Assets, Entries, Evaluation) Step 2 Print the Asset Year End Totals report Assets, Reports, Asset year end totals

Manufacturing Cost Accounting, Shop Floor and Labor Performance Year End Checklist

Step 1 Close the period the Cost Activity Trx Journal specified on the Source Journal Setup screen.  Open the next period. (System, Company, Package settings, Source Journal setup, G/L, Maintain, Period-date calendar)

General Ledger Year End Checklist

Step 1 Print a Trial Balance Report and verify balances (G/L, Reports, Balance/PL) Step 2 Select and print the financial reports for the period (G/L, Balance/PL) Step 3 Run previous year financials.  Note: If you run the Financial Statements after running Profit/Loss, they will still accurately reflect the prior year.  (G/L, Reports) Step 4 Generate the Final Trial Balance for the year that is being closed. (G/L, Reports, Balance/PL) Step 5 Complete the final year-end procedure. (System, Period-End/Year-End, Process profit/loss) Step 6 Close the period for the General Ledger journals. Open the next period.  (G/L, Maintain, Period-date calendar) Step 7 Close any remaining open journals for the period being closed. (G/L, Maintain, Period-date calendar) The Process Profit/Loss process creates the retained earnings entry for the year. This application does not close out the accounts or clear the current year transactions from the general ledger. You can print any previous year financial statement for comparative information by choosing the number of years you want to print on the report. The retained earnings entry is created and posted with the last day of the financial year, but does not show on the financial statements for that year allowing the financial statements to remain exactly the same as they were before processing profit/loss. The retained earnings account beginning balance for the next year will include the entry allowing the financial statements for the next year to be correct. (See the Process Profit/Loss topic in the Macola ES online help for more information.) You can process profit/loss multiple times for the same year.  Important: Process all posting for all packages and process all journal entries before processing profit/loss. If you do not process all entries for the year before processing profit/loss, your retained earnings entry will not be correct.   Remaining Packages The following packages have no period-end or year-end processes: • Bar Code • Bill of Material • Capacity Requirements Planning • Human Resource Management • Material Requirements Planning • Master Scheduling • Quoting and Estimating • Standard Product Routing • System Manager

On a calendar year?  Using Macola Progression Series?  Time to run a few extra closing procedures as you close the month of December, and the 2009 year.  Regardless of which version, you must first run the entire month end closing procedure.  If you don't have a month end closing procedure, please contact us and we'll gladly send you one. It is critical to perform these procedures in a timely manner, or the year to year comparisons, accumulators, etc. will not be updated or reset for the coming year.

Accounts Receivable

 -          Run all A/R reports before clearing Y-T-D accumulators (AR accumulators are cleared in the Order Entry module).

Purchase Order

 -          Clear Vendor Y-T-D Statistics (PO — Processes — Clear YTD Statistics).  Advance the System Period calendar to the next year.

Accounts Payable

 -          Clear Y-T-D accumulators (AP — Processes — Clear YTD Accumulators) -          Advance the System Period calendar to the next year.

Inventory Management

 -          Run all IM reports before clearing Y-T-D accumulators (IM accumulators are cleared in the Order Entry module).

Order Entry

Note:  When you perform the “Post Sales History” procedure, and then perform the “Period-End Procedure” for period 12, a message will pop up which says “You must run the year end procedure”  -          Perform the Sales History “Year-End Procedure” (OE — Processes — Sales History — Year End Procedure). o   This procedure will advance the Sales History Periods to the next year, and set the Current Period to 1.  Verify that this has occurred by checking under OE — Maintain — Sales History Periods.  -          Clear both the month end and the year-end accumulators for A/R and I/M.  This is the final closing step for these modules, and all desired reports should have been run prior to this step (many reports depend on accumulator balances).  -          CAUTION — You can only perform the “Clear Year to Date Accumulators” ONCE.  Clearing AR or IM accumulators more than one time will destroy prior year data.  If you do perform more than once please contact us for assistance - we can fix the data for you.  -          Clearing the AR Accumulators: o   Since you are in Period 12, when you perform the “Clear AR Accumulators” process, it prompts you as follows: Do you wish to advance the AR Accounting Period? Do you wish to roll Period Dates (for AR) to next year? Do you wish to advance the OE Accounting Period? Do you wish to roll Period Dates (for OE) to next year? o   You may, based on your answer to the above questions, allow the system to update the AR and OE System Periods for you.  -          Clearing the IM Accumulators o   This process does not advance the IM System Period or year for you.  This must be changed manually.

 Assets & Depreciation

 -        Run Year-End processing (AD — Processes — Year End Closing). -         Advance the System Period calendar to the next year.

 General Ledger

 Perform the Temporary Year-End Closing -          Once the month end is complete and preliminary statements for December have been completed, perform the “Temporary Year-End” Closing procedure.  This will advance the system accounting period calendar for General Ledger to the next year for all periods, and set the current accounting period for the General Ledger module to 1.  Do not advance these periods manually.  -          Note: If you are on a user-defined accounting year, you will need to manually correct the system accounting periods for all modules.  Once Financial Statements are finalized (this might be several weeks or months later): -          Complete all year-end adjusting journal entries. -          Print/Save Trial Balance as a final copy. -          Print the final year end statements. -          Run Final Year-End Procedure.  This must be done with no one in the system! -          Review Retained Earnings/Loss transaction by printing edit list. -          In G/L setup change “Allow out-of-balance posting?” to yes. -          Post retained earnings/loss journal transaction. -          In G/L setup change “Allow out-of-balance posting?” back to no. -          Run Trial Balance and compare to final Trial Balance.

I think I figured out the solution to our economic problems...here's how I think it can work: It is a slow day in a small town and streets are deserted. Times are tough, everybody is in debt, and everybody is living on credit. A rich tourist drives through town, stops at the motel, and lays a $100 bill on the desk saying he wants to inspect the rooms upstairs to pick one for the night. As soon as he walks upstairs, the motel owner grabs the bill and runs next door to pay his debt to the butcher. The butcher takes the $100 and runs down the street to retire his debt to the pig farmer. The pig farmer takes the $100 and heads off to pay his bill to his supplier, .the Farmer's Co-op. The guy at the Farmer's Co-op takes the $100 and runs to pay his debt to the local prostitute, who has also been facing hard times and has had to offer her "services" on credit. The hooker rushes to the hotel and pays off her room bill with the hotel owner. The hotel proprietor then places the $100 back on the counter so the rich traveler will not suspect anything. At that moment the traveler comes down the stairs, states that the rooms are not satisfactory, picks up the $100 bill and leaves town. The whole town is now out of debt and now looks to the future with a lot more optimism. Now, I didn't pay much attention in economics class, but it worked for them...

Landed Costs, or the "all in" costs of materials and inventory on the shelf, are very important for understanding true cost of product and margins.  Essentially, a landed cost is a product cost that is inclusive of not just the cost of the material that is paid to the vendor, but all of the costs incurred in getting it to your shelf.  Typical landed costs include inbound ocean freight, duties and fees paid, dreyage or other hauling charges, a harvesting charge for a crop, etc.  Some buyers even include their own internal material handling or receiving inspection charges to get inventory onto the shelf, or into a state where the inventory is ready for sale or use in a manufacturing process. Such costs can be considerable, especially if there are significant freight costs due to weight or ocean freight.  Imported items may have duties that should be associated with them.  The alternative to associating these costs with the specific inventory items that generated them is to charge the costs as a period expense, which then applies to all items sold.  Not only does this distort margins, it expenses the costs more quickly, which increases cost in the short term.  Since this lowers inventory valuation, it lowers profits, and with it income taxes.  The IRS has an opinion about this, which may not be the same as yours! Assigning and managing landed costs can get tricky.  Ocean freight cost for a container of mixed items is a good example.  You'll need to make some decisions regarding how to allocate the total freight cost...perhaps by weight, cube, value, etc.  There are several affordable small business and mid-market systems that help to achieve the goal of receiving inventory in at it fully-loaded expected cost, and accruing for both the actual cost of the inventory, along with all of the other cost elements.  Macola Enterprise Suite, Globe Enterprise and Microsoft Dynamics GP are great choices for managing landed costs.  They offer the setup flexibility needed to get this right, which is really important to managing this function properly, and keeping the administrative overhead needed as low as possible.