Recurring and Reversing GL Entries in Dynamics 365 Business Central (Demo)

I want to show you how you can use recurring and reversing entries in Dynamics 365 Business Central to really help you with that period end for your trial balance and for your financial statements. Let’s go to the recurring General journals page. On here I have an example of two types of entries that we can make in this screen. First of all, I have a fixed recurring entry and a variable recurring entry. The fixed entry is going to maintain the same accounts and dollar amounts every time you use it, so after you post it the first time it’ll come back with the same accounts, the same amounts. The variable entry will have the same accounts but it will zero out the dollar amounts. So what I’ll do here is I’ll put in an amount for the variable transactions, so let’s do that, and there I got my transaction done.

Recurring

One thing I like to do on these recurring General journals is to always run the posting preview sheet to make sure the transactions will post the way that I want them to. It’s easy to do, go up here and preview posting. This not only validates the posting but also shows you what’s going to happen. Here we can see what’s going to happen from the accounts, the dates, and the amounts, and this is exactly what I want. So I’m going to go ahead and post this, and currently, the transactions are June 15th, once I post this, they’re going to be updated by one month. The recurring frequency here tells the system to move the posting data by one month. Let’s go ahead and post that, so it posted that transaction and it updated the posting date to July 15th.

For the fixed journal entries, it kept the dollar amounts and the accounts. For the variable, it kept accounts and zeroed out the dollar amounts. So there are different ways that you can use this. The variable transaction type may be one that you use, for example, to record payroll on a regular basis. So I’ve got these transactions, I put them in this batch called standard.

Reversing

Let’s look at another type of transaction. This one is a reversing transaction, it’s a reversing variable, which means it’ll keep the account numbers once it’s posted, but it won’t keep the amounts. So this is something you might use for an accrual on an accrual basis for every month, and you may have expenses that you want to accrue on a regular basis so you can do that using this type of transaction, and what it’s going to do is I’ve got these dated for March 31st, the end of the period. This allows me to set up the correct posting date for the original transaction and also the correct reversing date, so I might have an accrual entry that I want to enter at the end of a period similar to this. This is for payroll, I’m going to accrue the last part of the payroll for the month. I might put a transaction in like this.

It’s especially important on these reversing transactions is to review the posting to make sure that the dates are correct, not only the original posting date but the reversing date as well, and you can see that I’ve got that just the way that I’d like it. I’ve got the original posting date at the end of March, it reverses on the first day of April. So I’m going to go ahead and post that. We can see that it’s already to post for the new month. The posting date is April 30th, the reversing date will be May 1st.

Let’s take a look at one more recurring transaction that you might like to use for your closing. This is a transaction that recurs on a regular basis. What it will do is clear out a balance in an account and then allocate it to other accounts, so what I’m doing with this transaction is I’m going to clear out the prepaid rent because this is the account to which I charge all my rent invoices, and I don’t have to specify the amount, the system will look at the current balance in that account, clear it out, and then allocate it. The allocations are here, so I’m going to allocate from prepaid rent to rent expense, and I’ve got it broken down to these different locations, and you can see I’m breaking it down by allocation percent. So let’s go ahead and post that. It posts that transaction, clears out the prepaid rent, allocates it to rent expense, and then gets the transaction ready for the next month.

So let’s look at the prepaid rent account and see what happened there. We just posted for April and the transaction is all ready to go for May. And you can see what it will do in May is clear out this twenty-two thousand dollars and then allocate it to rent expense. If we go back to April, we can look at that transaction, and we can see this is what happened. The original prepaid amount was paid on this invoice, and then we just posted the rent allocation journal and then allocated the amount out of that account and into the allocated rent expense accounts. So the balance transaction is a handy transaction you may find different ways to use this, and when you’re planning for your period end, trying to adjust your trial balance to make the financial statements good, you may want to look at the recurring and the reversing transactions in Dynamics 365 Business Central.