How To: Create and Process a Reversing Pre-Payment Journal Template

A Reversing Pre-Payment Journal Template is used to pay for an item, for example insurance and enables the user to spread the cost over a period of time, so that the amount in the P&L is shown as a monthly amount and not one large amount once in a period. To follow the example below the following nominals are required:

To create a Reversing Pre-Payment Journal Template requires the template to be setup and then it must be processed. The following example assumes that the initial outlay has been processed through the Purchase Ledger in the normal way.

Creation and Template Generation Procedure

To create the Journal Template:

1. Open a Journal Templates screen (show me how).
2. Press Ctrl+N or click .
3. Enter the Description / Name: Building Insurance 2016
4. Date Started: 01/01/2016
5. Day of: 1
6. Interval: Month
7. Count: 12
8. Template Type: Reversing Pre-Payment
9. Add the Nominals:
   1. [810] Building Insurance
   2. [800] Prepaid Insurance
10. Split Amount: 1200
11. Click the button.
    Note: the order in which the nominals are added dictates whether the button or the and button is used.
12. Go to [ 2: Initial Journal ] tab.
13. Add the Nominals:
    1. [810] Building Insurance
    2. [800] Prepaid Insurance
14. Credit the [810] Building Insurance by 1200.
15. Debit the [800] Prepaid Insurance by 1200.
16. Press Ctrl+S or click to save.
17. Click the button.

Processing a Reversing Pre-Payment Journal Template

1. Go to [ Process List ] tab
2. Process the first interval and Pre-Payment Initial Journal, see Process a Journal Template Schedule List.
3. Process each other interval as required, for more information on processing journal template intervals see Process a Journal Template Schedule List

See Also

• Accounts overview