RIMAS for UNIX Software Installation

To: All Users of SLG Accounts Receivable System

From: The SHARED LOGIC Group, Inc.

Re: Period-End Processing and Closing

Date: February 16, 2004

The following is a discussion of the programs that should be run and procedures that should be followed at the end of the period, related to reporting and closing Accounts Receivable. As you review these steps, you will find that not all steps are required (though some optional steps are recommended). You should revise this outline to satisfy your company's requirements.

This discussion begins at the point that all of the normal, daily functions have been completed for the last day of the period about to be reported and closed. It should be noted, however, that these steps do not have to be performed before you begin processing activity for the subsequent period, whether invoicing or cash receipts posting. The only requirement is that all activity for the current period be completed before you proceed with this procedure.

Ensure that the last invoice batch posted to A/R has been printed and updated to the account history.

Ensure that the last cash receipts batch that was entered has been printed and updated to the account history.

The calculation and posting of finance charges is optional. If the finance charge module is used by your company, it should be processed at this time. Finance charge transactions become part of the normal monthly activity, but are normally created after all other activity is posted.

The period-end reporting process includes running the following programs:

Create & Sort Period-End Item Journal, then Print Period-End Item Journal

Print Period-End Receipts Journal

Create & Sort Item Distributions, then Print Period-End Distribution Report

Create & Sort for Period-End Trial, then Print Period-End Trial Balance.

At this point, you should "reconcile" the activity for the A/R accounting period:

Confirm that the Period-End Distribution Report nets to zero (0).

Confirm that the debit to A/R on the Period-End Distribution Report equals the total from the Period-End Item Journal, less the total from the Period-End Receipts Journal. This net may be either a credit or a debit.

Confirm that the total from the Period-End Trial Balance from last period-end, plus the total from the Period-End Item Journal, minus the total from the Period-End Cash Receipts Journal, equals the total from the Period-End Trial Balance from this period-end.

If any of these cannot be confirmed, you must determine the cause of the error and then re-perform these steps.

Now, there are several reporting options available to you. These must be printed at this point, before the data for the period is closed, if you want the reports that are produced:

You should run Create & Sort for Statements, and Update Statements to Account History, if you are using the Account History aspects of the A/R system. Further, you should actually print statements, if you send them to customers or require them for internal purposes.

If required, run Create & Sort for Sales Rank, then Print Customer Sales Rank Report.

If required, run Print Days Outstanding Report.

If required, run Create & Sort Tax Distributions, the Print Tax Distribution Report.

You are now ready to merge A/R to G/L. Proceed as follows:

In the G/L menu, run Interface A/R to G/L Detail (for either Scrap or Steel).

In the G/L menu, run Print Detail Journal to confirm that the batch is acceptable.

Optionally, in the G/L menu, you can run Update Detail Journal to Accounts at this time. Of course, this can be run later also.

Back in the A/R menu, perform the following steps to actually close the period for A/R:

Print Maintenance Audit List

Create Maintenance Audit List

Update All Files at End-of-Period

If this is the last period-end close in the year (either calendar, which is recommended, or fiscal), you should run Update All Files at End-of-Year.

You may now continue processing the new period. Any activity entered after this point that should have been part of the period just closed, will automatically be included with this new current period. For example, if you have just closed January, causing the current period to be February (assuming a 12 period accounting year), any invoices entered in February with a January date will be treated as, and become part of, the February activity.

Shared Logic recommends that you retain the Period-End reports printed above (Item Journal, Distribution Journal, Cash Receipts Journal, and Trial Balance) as your permanent record. We believe that the Daily Items Journals and Daily Cash Receipts Journals may be discarded, although there is accounting opinion to the contrary. There may be other reports that are no longer needed, such as interim trial balances. However, you must determine your specific report retention requirements, not relying solely on Shared Logic's recommendations.