Sage 200 - Open Period Accounting and the effect on Nominal Postings

The article explains 'Open Period Accounting' in Sage 200 and the associated nominal postings.

Open period accounting means that more than one financial period can be 'Open' in the Nominal Ledger, at the same time. This means that more than one period will accept postings either from within the Nominal itself and/or from the other ledgers.

The number of periods that can be open at the same time is configurable using the System Settings. However there can be less than the specified maximum number Open for all or just some of the ledgers.

The periods can be open to postings from the other ledgers individually, e.g. postings from the Sales can be open when postings from the Purchase ledger are not, for the same financial period.

Financial periods for each ledger can be one of 3 states:-
• Closed - postings from the relevant ledger cannot update the Nominal Ledger for this period.
• Open - postings from the relevant ledger will update the Nominal Ledger for this period
• Future - the period is not yet Open so any postings from the relevant ledger for this period will be held in Deferred Postings.

All other ledgers must be closed for a financial period before the Nominal Ledger itself is closed for that period.

Postings made to the Nominal Ledger

The transaction date, the status of the accounting period for the ledger in question and the Nominal Ledger settings will determine where the posting ends up:-

Nominal Ledger Setting ‘Update Nominal Ledger immediately transactions are posted’ is selected

• If the posting has a transaction date between the start and end dates of any Open period, it will be posted directly to the nominal accounts for the relevant period.
• If the posting has a transaction date before the start date of the earliest Open period, it will be posted directly into the nominal accounts for the earliest Open period I.E. it will not update the Closed periods.
• If the posting has a transaction date after the end date of the last Open period it will be placed into Deferred postings.

Nominal Ledger ‘Update Nominal Ledger immediately transactions are posted’ is not selected

• If the posting has a transaction date between the start and end dates of any Open period, it will be placed into Current waiting postings.
• If the posting has a transaction date earlier than the start date of the earliest Open period the posting will be placed in Current waiting postings
• If the posting has a transaction date after the end date of the last Open period it will be placed into Deferred posting.
• When the Update Waiting Postings routine is run in the Nominal, any transaction in Current postings will be posted directly to the nominal accounts for the Open period for which its transaction date is relevant:

I.E. Its transaction date is between the start and end dates of an open period – it is posted in that period.
Its transaction date is earlier than the start date of the earliest Open period – it is posted into the earliest Open period

What happens to Nominal postings when a period’s status changes?

Future period is opened

• Update Nominal Ledger postings immediately transactions are posted’ is selected,

The postings in Deferred postings, where the transaction date falls between the new period’s start and end dates, will be posted directly into the nominal accounts for that period.

• ‘Update Nominal Ledger immediately transactions are posted’ is not selected

The postings in Deferred postings, where the transaction date falls between that new period’s start and end dates, will be placed into Current waiting postings.

Open period is Closed

Current waiting Postings is checked for postings, from the relevant ledger for the period about to be closed I.E. the transaction date is between the start and end dates of that financial period. If any are found, a message is displayed advising that these must be updated to the Nominal Ledger, using Update Waiting Postings, before the period can be closed.

If no waiting posting are found for the period the process continues by marking that period Closed for that ledger.

For the Sales and Purchase Ledgers additional processing is carried out, the figures viewable through View Closed Period Balances are calculated:

EG for the Sales Ledger
• The total outstanding on the Sales Ledger is calculated as at that end date - removing any allocations with transactions later than the end date (in effect a retrospective Debtors total).
• The total of the Debtors control account in the Nominal is calculated as at the end of that period (any transactions for later periods are ignored).
• Any difference between these figures is calculated.

Open period is made Future

The transactions already posted to the nominal will remain as they are, but the period is now marked Future so any further postings to this period will be placed into the Deferred postings file.

Existing Closed period is re-opened

The transactions that were posted after the period was closed, and so they would be posted to the next available Open period instead, will remain as they are. Any that are in Current waiting postings for this re-opened period, will be updated to the accounts for the period when Update Waiting postings is run. The period is now marked Open and will accept further postings.

NOTE: If you encounter a scenario where some transactions do not move to the ledger as expected, you may follow the Move Deferred Postings process to resolve the issue. This only applies to Sage 200 Professional. If you are experiencing this issue on Sage 200 Standard or Education, please contact our technical support team.

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