SSI Insights

Open Period Processing

Open Period Processing

March 31, 2023

Open Period Processing

Word of the day? VERSATILITY

What's even better than hot coffee in the morning?

The VERSATILITY within your SSI Oil and Gas Accounting Software product. It's endless. Today we're discussing the ability and benefits of multiple open periods processing and how to get good inclusive balances for all open periods.

How do I get current, up-to-date financials if I'm not current on closing General Ledger periods? Getting current and complete General Ledger information is CRUCIAL to my business, especially at year-end.
Do you use open period processing? Do you want to use open period processing but are skeptical? Don't know the details, options, and benefits?

Right off the bat, we can think of some big benefits for open period processing. For those johnny-on-the-spot users who close the general ledger each month with no down-time, BRAVO!! But just so you know…transactions can be entered into multiple periods. Enter month-end adjusting entries (like bank charges from the bank statement) into the accounting period incurred, while the Accounts Payables department (as an example) is moving on down the road, entering transactions into the next (future) accounting period, with no pause of daily work-flow.

Say it's March 10 and you're still working on your month-end processing for accounting period 02 - February. Normal daily work flow into accounting period 3 (March) does NOT have to stop for the period 02 (February) General Ledger month-end closing processing to be completed. Time is money, and the Accounts Payables department must be able to continue normal daily processing with no down time or thumb- twiddling. In SSI, this marvel of accounting is referred to as Open Period Processing and is the best thing since sliced bread. Up to 12 accounting periods can be open at once, the whole reason being so daily work flow can continue, in the proper period, independent of the prior month-end auditing, bank reconciliations, etc. and General Ledger closing.
With all that said…here's a nifty “did-you-know” tidbit to bring it all home.

GL07 ‐ Trial Balance on Future Periods
Along with the open period processing concept comes the ability to include multiple/future periods on the GL07 - Trial Balance and other financial reporting. What's your cash balance right now? Even if you have multiple periods open you can get a good balance on cash, or anything else for that matter, as of the most current accounting period. Accurate, real time cash balances and real time liabilities? That's really important for money management and financial planning.
Using the practical application scenario above, accounting period 02 (February) is still open and you're working on bank rec/financials. But the Accounts Payables department has moved on and is keying invoices into period 03 (March), paying bills, the Accounts Receivables department is receipting checks for owner JIB balances, and all sorts of other daily processing.

Entering transactions into the proper period is important for so many reasons ‐ for JIB processing, company net income and expense, proper Accounts Receivables balance aging and cash, just to name a few.

Sooooo... enter transactions in the proper period, and for an up-to-the-minute accounting of balances for all open periods (which, in our example will be oldest open period 02 Feb as well as anything entered into period 03 March).

In GL07 ‐ Trial Balance enter the most current period (period 03) in the Period to Process field. The Period Ending date will auto-update appropriately (same example above, 02/28/23 will change to 3/31/23) and all ending balances will be inclusive of both period 02 and period 03 transactions.

What about crossing a year?
Crossing years is no problem for SSI. If period 12 (December) is still open but the daily work-flow has moved on to “future” period transactions in one or more periods in the new year (01, 02, 03, etc.) SSI is smart enough to know that ending balances (income/expense) from period 12 should flip into Retained Earnings. ACTUAL ending balances, correct as of the new year periods will be reflected in the income/expense, and last year's ending balances for income/expense will be included in Retained Earnings.

Another practical application
Run GL07 ‐ Trial Balance for period 12 to get accurate ending balances as of period 12. That's a given. But! Run GL07 ‐ Trial Balance for period 03 ‐ it knows what ending balances from last year (period 12) should go to Retained Earnings. In this instance of crossing over a year, an additional field is presented on the GL07 ‐ Trial Balance dialog screen ‐ Retained Earning Account for Processing Future Periods. The Retained Earnings account assigned in the GL01 Company Maintenance record will prefill as the default, but there's a drop-down to select a different Retained Earnings account if desired. VERSATILITY.

This process does NOT actually make any entries to Retained Earnings ‐ go through the year-end processing checklist for that. But it does reflect what and how Retained Earnings will be affected for year-end and for open period balances in the new year. There are so many advantages to be had with SSI Oil and Gas Accounting Software. This particular feature means more time to make sure your books are accurate and correct when closing, and with less stress!

SSI does NOT recommend keeping a bunch of periods open. A max of 12 periods can be open at once. It's always best to keep the General Ledger closed on a timely basis. Saves a lot of wear and tear on the brain.

The important message to convey is that the General Ledger does not have to be closed for one month before entering transactions into the next month. It can be rolling, rolling, rolling. With the ability to re-open a closed period (yep, you heard that right!) there's really no reason to not close the General Ledger on a timely basis. It's easy to do. Keep the periods closed and if you need to re-open, we can help you with that! VERSATILITY.

SSI Oil and Gas Accounting Software is the best in the industry for accuracy and versatility on your oil and gas accounting needs and requirements.

SSI ‐ making YOUR job EZier!

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