Friday Feature - Prepay Vendor Requisitions

My son is going to start college in the fall, so I am in the midst of paying for things that aren't going to arrive or be used for many months. This happens to everyone, even school business AP clerks. Just like freshmen orientation, school business conferences want their payments in advance. No worries. If you receive an invoice for a next year requisition and that vendor must be paid prior to July 1, Escape Online has got you covered.

Actually, we have you covered twice!

Both the AP-Payments activity (where you enter payments one by one) and the AP-Enter Payments activity (where you enter payments in a batch mode) produce the same results. There is only a minor difference between the two on how you handle the fiscal year.

  • The AP-Payments activity automatically knows the fiscal year of the requisition when you create the new payment.
  • The AP-Enter Payments activity requires you to enter the fiscal year of the requisition at the top of the form.

Since Escape Online knows TODAY's date, it can compare it to the fiscal year of the requisition and create the appropriate journal entries, automatically.

When the check is printed, see how there are two journal entries created. One with a transaction date of TODAY and one with a transaction date of the first day of the next fiscal year.

  • For the base year, the JE (EX13-01548) debits the account specified as the prepay account and credits the cash account.
  • For the next fiscal year, the JE (EX14-00002) credits the prepaid account and debits the expenditure account specified in the requisition.

Then, if you take a closer look at the second or "next year" journal entry, you will see how the money is moved. (The prepaid account is debited by the beginning balance journal created during the year-end roll-forward procedure.)

This automated prepay process can take a load off your mind and your To Do list.

Because, sometimes, paying for things in advance can be a very good thing.

Remember, this process works for requisitions created for next year, meaning you have multiyear processing turned on for your requisition.