YEAR END
PROCESSING
Retained Earnings
Account:
This account is used during the year-end
processing to record cumulative retained earnings.
Net Closing Balance flag:
Yes or No?
You have two choices at close period of the
year end:
A. Let the open new period close down all
the income statement accounts and put the results in the retained earnings in
the same way it has always done. This also rolls the balance sheet accounts into
the first period of the new year like it does any other period.
B. Create a journal showing the movement of
the income statement accounts into retained earnings or an account of your
choice. You can also create a journal for the balance sheet accounts showing
what will be used as opening balances next year. This is to fulfill a legal
requirement in some countries specially France.
If you choose B then the option in the 'Net
Closing Balance Journal' choice in the Accounting Setup Manager comes into
effect. This will close the balances either as a net figure to the closing
journal (when ticked) or as Cr and Dr figure to the closing journal (by
default). The Net closing flag allow users to choose between closing balances by
journaling out both the Dr and the Cr balance or just the net balance on a code
combination [ Retained Earnings ].
CURRENCY TRANSLATION
OPTIONS:
Cumulative Translation Adjustment
Account:
This account is used to record the
cumulative adjustment for translations. Once this account is used in a
translation, it cannot be updated.
| The CTA account is not filled through a calculation, it is simply a plug
between the difference in the debits and credits after translation is run. Since the Assets/Liabilities, OE, and Revenue/Expenses typically use
different translation rates, it is common for the translated balances not to
equal. Therefore, the CTA will simply fill in the difference to make the
debits equal the credits. There is no calculation for this
account. |
AVERAGE
BALANCES
Net Income
Account:
This account captures the net income on the
average balances.
ROUNDING ACCOUNT & SUSPENSE ACCOUNT
When the rounding account is used and when the suspense account is used?
A. During Journal Import of a foreign currency journal
1.If the currency conversion type in GL_INTERFACE is not provided, and the
accounted amounts are provided, then any imbalance in the accounted amounts will
go to Suspense.
2.If the currency conversion type is provided in GL_INTERFACE for the
foreign currency journal, and the currency conversion type is User with a
currency conversion rate of 1, then any imbalance in the accounted amounts will
be posted to the Suspense account.
3.If the currency conversion type is provided for a foreign currency journal,
and it is not User with a rate of 1, then and only then will the imbalance go
to the rounding account.
This is because when Journal Import and consequently Posting is presented
with user-defined accounted amounts, GL has no way of knowing the if the
difference in the accounted amounts is due to suspense or rounding.
Currently, we are assuming that the difference should go to suspense.
B. In the Enter Journals form:
1. If the user manually overrides the accounted amounts, the assumption is
that the difference in the accounted amounts is due to suspense and not
rounding, since the user explicitly chose to override the accounted amounts.If
you manually change the accounting amount the conversion_flag is set to 'N'
in the created headers, therefore, posting is rejecting the batch instead of
balancing it by adding the rounding difference to a journal lines.
Oracle doc Doc ID 340341.1
