Summary

In Sage 200 you may be asked to post a prior year journal.

This blog explores how prior year journals work and how you can post them.

How does a prior year journal work?

Journals to Balance Sheet accounts

If you enter a previous year journal to a Balance Sheet account, this updates the following values:

• The period balance of the nominal account for the date of the journal.

• This is shown when you run a prior year trial balance for that period. For example, if the journal is dated in November of the previous year, then November’s balance is updated. When you run a prior year trial balance for November, then the new value is reported.

• The closing balance for the nominal account at the end of the previous year. This is shown as the YTD value for this nominal account when running prior year reports. For example, if the journal is dated in November (period 11), the YTD value for the previous year is updated. When you run a prior year trial balance for December (period 12), a new YTD value is reported.

• The current year to date balance. This is shown on your current year reports. For example, if the journal is dated in November of the previous year, then the YTD balance on the current year is updated. When you run a trial balance for the current year, a new YTD value is reported.

Journals to Profit and Loss accounts

If you enter a previous year journal to a Profit and Loss account, this updates the following values:

• The period balance of the nominal account for the date of the journal. This is shown when you run a prior year trial balance for that period. For example, if the journal is dated in November of the previous year, then November’s balance is updated. When you run a prior year trial balance for November, then the new value is reported.

• The closing balance for the nominal account at the end of the previous year. This is shown as YTD value for this nominal account when running prior year reports. For example, if the journal is dated in November (period 11), the YTD value for the previous year is updated. When you run a prior year trial balance for December (period 12), a new YTD value is reported.

• The value of the Accumulated Profit nominal account (as this account would have been affected by the Year End). This is shown on your current Balance Sheet. For example, if the journal is dated in November of the previous year, the Accumulated Profit for your current year is updated. When you run the trial balance or Balance Sheet for the current period, then value of the previous year journal is reflected there instead.

How do I do this?

In the following example we’ll go through posting a Profit and Loss Journal.

1. In order to do this, you’ll firstly need to enable this feature on the Nominal Ledger Settings.

2. You can then specify the default posting date.

3. After you do this navigate to the Nominal Ledger module > Enter transactions > Previous year Journal Entry

4. Enter a Journal title, a Journal Reference and select the posting date.

5. Then select the nominal codes you want.

6. Finally, click on the post button.

Now let’s have a look at the Nominal balances before and after the Journal.

NOTES:

• We can see that there is a posting on the Profit & Loss account, but Sage is creating a Balance Forward balance so the balance for this year is 0.

• On the Balance Sheet account, we can see that Sage created a posting that is affecting the current balance as it is a balance sheet account.

• We cannot see any posting on the Accumulated Profit account, but we can see that the Balance Forward and Current Balance has been updated.

Additional Information

• We recommend that you do not use this option if you are using consolidation. Adjustments to prior year journal values are consolidated into the current consolidated period and will distort current year values.

• You’ll see this error when you don’t have any previous year accounting periods. If you’ve never processed a Year End in Sage 200, the required accounting period(s) in the previous year may not exist. When this occurs, you won’t be able to enter a journal for that date.

Further Information

If you have any questions about this or need assistance, then please contact the GCC Group Support Team on 0345 260 1151 or servicedesk@gccgroup.co.uk

Disclaimer

Following these steps may have an impact on any third-party add-ons you have installed in and alongside your Sage 200 system. We would always recommend that you conduct thorough testing on a copy of your live databases and that you contact all the providers of any 3rd party addons or integration packages to ensure that their functionality is not going to be compromised in anyway.

Sage 200

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The modules available mean the software can grow and adapt as your business grows.

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