Accrual invoicing

WorkBook is able to automatically generate accrual entries distributing a cost or revenue over a period of time. Accrual handling is available for purchase invoices, as well as sales invoices that are based on a subscription.

A video introduction:

Basic principle

Accruals do not affect the original ledger entries made when journalizing an invoice, but are made in addition to these. The net cost or revenue is “moved” from the original invoice date and account, and distributed to the dates and accounts specified by the accrual schedule.

Accruals for subscription invoices

For this to work, the following account references must be filled out. This will specify the accounts on which accrual ledger entries will be made.

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For subscription invoices, accrual handling will happen automatically if so specified on the subscription:
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However, notice that accruals will only apply to subscriptions with forward-invoicing.

Accruals are made based on the subscription period covered by the invoice, regardless of the actual invoice date. Entries are posted on the last day of each month, with the last entry made on the end date of the period covered. The amounts are distributed according to the number of days each month contains that are included in the subscription period covered by the invoice.  So for instance, an invoice in the amount of 1000,00 covering the period of June 15 to July 14 (incl.) would be accrued as (16/30) * 1000 = 533,33 on June 30 and (14/30) * 1000 = 466,67 on July 14. Full months are distributed evenly regardless of their length in days.

Accruals for purchase invoices

For purchase invoices, accruals are made on a per-line basis, and only if so specified by the user when entering the line data:

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WorkBook will suggest an accrual schedule based on the invoice date and the desired number of months. The suggestion can be edited manually.

Unlike subscription invoices where accruals are always made to the accounts specified in the general settings, the operational account used for purchase invoice accrual entries must be specified manually each time, as shown in the screenshot. The offset account will be the cost account specified on the purchase invoice line.

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