Prepayment Schedules

A prepayment schedule is used to schedule the posting of income or expenditure from an initial value recorded to a Balance Sheet account to be spread over a selected time period (months, quarterly etc.) to appropriate income or expenditure accounts.

Usually only relevant when accrual accounting (Income and Expenditure reporting for Not-for Profit organisations) is adopted; the balance sheet accounts used must be the system accounts

Accruals and Deferred Income
Items which owed or potentially owed by the organisation to third parties and are classed as account type - Current Liabilities.
Prepayments and Accrued Income
Items which third parties owe or potentially owe to the organisation and are classed as account type - Current Debtors

Sub-accounts of these two may also be used. Note if the accounts are not currently in the organisation's chart of accounts add from the list of standard accounts.

Accounts - Add Standard Accounts

Sub-accounts can be created via Add a Custom Accounts being sure that any account created is a sub-account either of Accruals and Deferred Income or Prepayments and Accrued Income

Setting up a Prepayment Schedule

In summary the process is :-

Examples of common situations and approaches

Accrual means an expense that is incurred in a period but not paid until a future accounting period. See Example
Deferred Income
Deferred Income is where monies are received for goods or services not yet earned. See Example
Payment is made for service or goods which are yet to be provided and is not treated as an expense until it is. See
Accrued Income
Accrued Income is where goods or services have been provided but payment has not been requested or received See Example

Deleting a prepayment schedule

An existing prepayment schedule can be deleted by navigating to Prepayment Schedules.

Control - Prepayment Schedules - Use the filters to locate the relevant schedule

From the Action Menu click DELETE. Any remaining scheduled items will not be posted and the schedule will be removed.

Note scheduled items that have already been recorded will NOT BE DELETED by this process. If required they will have to be deleted as individual journals. The user will still need to deal with any remaining balances on the Accrual and Deferred Income or Prepayments and Accrued Income accounts.