End of Month Processes for Lentune Wholesaler Users

A guide to suggested End of Month Processes.

Introduction

Receivables End of Month Processes

Payables End of Month Processes

Stock End of Month Processes

Fixed Asset End of Month Processes

General Ledger End of Month Processes

Introduction

The End of month Processes should be run in the order set out below. You can find a checklist document that you can use to guide you through the suggested order of processing here: Sample Checklist.

The reason for closing month end for the various modules is to ensure that when values are posted from one ledger to another, that they are included in the correct month, thus allowing reporting by month for the current or past months with your reporting figures being correct for the period selected. Reports that are month critical include:

• Receivables (Debtors) Ledger Trial Balance. This report shows the movement of invoices, credits, journals, tax, payments and balance as well as overdue values by monthly analysis.
• Payables (Creditors) Ledger Trial Balance This report shows the movement of invoices, credits, journals, tax, payments and balance as well as overdue values by monthly analysis.
• General Ledger Trial Balance, Financial Position and Financial Performance reports. These reports show the Current Month and Year to Date values.

These reports can be run for the current or any past month. The close month procedures anchor the values in the correct time period so the balances for any module can be reported at any time.

You can check what month any module is in by going to the module Manager on the Settings menu. This date will automatically update when the Close Month process for that module is performed, so it is not necessary to change this date manually.

The order of processing is:

• Close Receivable Month (1st).
• Close Payable Month (16th).
• Close Stock Month (17th).
• Close the Fixed Asset Month.
• Close General Ledger Month.

Receivables End of Month Processes

1. Check and approve all Receivable Invoices before month end.
2. Check that your points levels are correct. The Close Receivable Month process will update the points levels for your Receivable accounts.
3. Close Receivable Month (1st).  This process also automatically creates the Receivable statements. This is located on the Receivables > Monthly Tasks menu. We suggest that you do not manually run the Receivable Statements, as these will be created as part of the Close Month process. This can be done on or after the first day of the next month.

Payables End of Month Processes

1. Check all Payable Invoices for last month are in the computer. You can read about approving Payable invoices here.
2. Manage / Pay Accounts suppliers (20th, 25th, 30th). Select and approve the invoices to pay and click Pay all in list. This will create a cash book transaction with supporting posting to the payable accounts. Note that the cash book transaction will not be posted back to the payable account until the transaction has been presented. Note: It is not necessary for the Payable invoices to be paid before the month end, as they may not be due until later, e.g. 20th of the following month.
3. Process the daily banking in your Cash Book. Refer to Summary of Daily Cash Book Procedures for details.
4. Post cash book transactions. Refer to Post Cash Book Transactions for details.
5. Make sure the Cash Book End of Day processes have been run for the last day of the month.
6. Reconcile the Supplier Statement with our records. Many Suppliers may not send statements, especially if they request payment within the same month and you have paid them, so that your balance with that supplier will be zero. The Payables Trial Balance report can assist you to easily check the balances for your Payable Accounts in your system to the statements received from your Suppliers.
7. Review and check Delivery notes not invoiced. To do this, go to Payables > Delivery Notes. Select Advanced Search, and tick the box for Uninvoiced only.
8. Review and chase up Credit note requests. When you Receive Goods in, or approve your Payable Invoices, you may have requested credits for goods returned or invoiced and not received. When you check the Supplier Statement to your Payable Trial Balance, you should be able to see discrepancies that will help to highlight any missing Credit Notes.
9. Close Payable Month (16th). The delay to process the Payable end of Month allows time for your payments to be presented to your bank account. When you are happy that the Payable Trial Balance figures are correct and all invoices, credit notes and payments have been processed, and payments have been presented, you can close the Payable Month. This is done from the Payables > Monthly Tasks menu.
10. Select the payable option Exchange Rate Variation for the month just closed. (This is only required it you are running multi-currency payables). The menu option is: Payables > Post payable foreign exchange revaluation.
    
    NOTE: Closing the payable month will adjust the rebate dates on Payable Accounts.

Stock End of Month Processes

1. Check and review branch stock transfers. This step shows you if all stock that has been transferred out of one branch has been received to the new branch, thus ensuring that all Stock is recorded in the correct branch at the month end, and is not still in transit. You can do this from the Stock > Stock Transfers menu, or you can export the report from the Stock > Export > Stock Transfers menu option.
2. Post All Stock Transfers for the month. This process ensures that all stock that has been transferred between branches will be recorded in the correct branch, ensuring correct stock valuations at each location. It can be done from the Stock > Monthly Tasks menu.
3. Close Stock Month (17th). This process creates an automatic journal entry to show the change in stock value by checking the Balance Sheet Stock on Hand account and posting any necessary update to the Trading account for Cost of Goods Sold, thus ensuring that stock is correctly recorded at the appropriate Branch and accounting value and will then be reported as assets for the correct Branch on the General Ledger reports for any month, and shows the change in stock value in the trading account. This step is also located on the Stocks > Monthly Tasks menu. It is suggested to run it part way through the next month, e.g., 17th, for the end of the previous month to ensure that all transfers have been processed at both the transferring and receiving Branches.

Fixed Asset End of Month Processes

1. Check the Fixed Assets / purchased or sold account is zero. (This is the fixed asset clearing account). This step ensure that any assets purchased or sold during the month have been correctly coded and will be recorded with the appropriate purchase or sale date. Do this by checking your General Ledger account code for Fixed Assets purchased/sold.
2. Close the Fixed Asset Month. This option is found on the Fixed Assets > Monthly Tasks menu.

General Ledger End of Month Processes

1. Manage, calculate and pay GST. Print the General Ledger Tax Report. You can read how to check the balances from this report to the income and expenses in this article: General Ledger Tax Report. Check the total for GST Payable from the Payable Trial Balance is the same as that for the current period of the General Ledger Trial Balance. Check the total for GST Receivable from the Receivable Trial Balance is the same as that for the current period of the General Ledger Trial Balance.
2. Print GL Year End Reports. Select and print the General Ledger reports that you require. These may include the Profit & Loss from the Analytics menu, Trial Balance, Company / Branch Statement of Financial Performance, Company Statement of Financial Position.
3. Close General Ledger Month. This is located on the General Ledger > Tasks menu.
4. Select the Cash Book option Post Exchange Rate Variation if you have multi-currency bank accounts. 
5. Reconcile GL totals to all sub systems: Receivable balances. Check that the General Ledger value for the Receivable Account is the same as the Receivables Trial Balance.
6. Reconcile GL totals to all sub systems: Payable Trial balance. Check that the General Ledger value for the Payable Account is the same as the Payables Trial Balance.
7. Reconcile GL totals to all sub systems: Stock. Check that the General Ledger value for Stock on hand Account is the same as the balance in the Stock Valuation Report.
8. Reconcile GL totals to all sub systems: Cash Book Bank account. Check that the General Ledger Account for the Bank Account is the same as the balance in the Cash Book. You can check the Cash Book bank balance in Cash Book > Cash Book bank accounts, then click on the bank account to view the Summary details.
9. Reconcile GL totals to all sub systems. GST totals.

By following the checklist, you can efficiently complete all the necessary steps to keep your ledgers up to date.