There are several important procedures to note in running the accounts receivable subsystem; although some installations may wish to modify these instructions to suit a particular circumstance, this should be done only with a full understanding of the reason for the procedure.
At the close of each day, the normal procedure is post the A/R entries to general ledger. Although the system will function correctly with posting to G/L as infrequently as once a month, good accounting control calls for posting each day. In particular, since the posting date for cash receipts is entered by the user as part of the posting process, posting should be done each day when a bank deposit is made so that the journal entry for cash will match the deposit slip.
The posting reports should be filed in the journal entry file along with those from A/P and the G/L; this provides a complete audit trail of all general ledger activity, filed in journal entry number sequence.
While not really part of the daily cycle for the FACCTS software, it is a good idea to review the paperwork for each day at this time. Make sure that all items have been entered are marked (use a rubber stamp, initials, etc) as entered and that no items have been missed. In many installations, an additional check on the data entry is done by taking the total of the sales figures from the invoices and checking this number against the posting report. Cash receipts should be checked by comparing the deposit slip to the posting report.
The monthly procedure is divided into two phases. The first phase must be completed before the monthly procedure for G/L is started; the second phase is optional and may be done after the G/L sequence has been started.
Phase I - Prepare for G/L Closing
1. Make sure that all paperwork for the month has been entered.
2. Complete a daily cycle to ensure that all activity has been posted to the general ledger.
3. Run the aged trial balance; this will be used to confirm the account balance in the general ledger
accounts receivable control account. After it is used for this purpose, it should be returned to
the accounts receivable department for their use in collections, etc.
4. Notify the person responsible for the general ledger closing that A/R has been closed for the
month. Do not make any entries to the month after this. You may, however, continue work on activity
subsequent months.
Phase II - A/R Internal Processing
Normally, the end of the month is the time for running statements, cash journals, sales journals, and income journals. These may be run as desired without any effect on the general ledger closing process.
There is no special procedure required in accounts receivable at the end of a fiscal year. This is a convenient time to purge the old details of closed items from the database, however this may be done at any time it is desirable or necessary. Some installations will have special procedures required by the audit process, such as a fiscal-year sales journal.