We have discontinued a former line of business and have some outstanding payables that related to that business, and we are using Manager since 1 July. I don’t want to record the pre-July 1 purchases to an expense account which is no linger relevant.
I created a liability account in Manager called ‘Accrued expenses’ and entered the unpaid purchases dated 30 June, charging them the Accrued Expenses account. But Manager does not include those purchase in the Accounts Payable balance.
Can someone suggest how to handle these purchases, please?
For a start, Accounts Payable being a Liability account can’t have your Accrued Expenses (the contra) also as a liability account - it should be an Asset account, expenses are debits and so are assets.
When you say they aren’t appearing in the Accounts Payable are they appearing or not appearing in the Accrued Expenses as well ?.
What dates have you entered for Settings - Start Date and for Summary tab - Set Period.
Both should be Jul 1.
If there is still an issue, post a screenshot of the accounts payable entry.
As an aside - try and use another “regular” account for these one off transactions. If you use Accrued Expenses then you are stuck with this account forever as currently COA’s can’t be marked as inactive. If you have a clearing account used for bank rule bank transfers - then use that.
@CEH, I also wonder about your statement that you “discontinued a former line of business.” If you mean you terminated an old business entity and started a new one, even under the same ownership structure, then nothing from the old business should be carried forward in any way. You should instead continue the books of that old business until all economic activity is complete, even though you may not be actively pursuing that endeavor anymore. Accounts payable from that old business are not relevant to the new one. And they are certainly not accrued expenses of a new business. In fact, they are not accrued expenses of any business, because they have already been incurred, even though not yet paid.
If you have merely given up a product or service line in the same business entity, relevant transactions should be handled in the same way as those for current product or service lines. The issue of making the transition to Manager is separate. Either way, the Guide @Brucanna referred to could be relevant.
Additionally, understand that Accounts payable is a control account made up entirely of subaccounts for suppliers. Nothing appears in it unless entered properly, including by designating that supplier.
One more thing to check - under Summary tab Set Period is it set to Cash Basis, if yes, then Accounts Payable isn’t shown. Change to Accrual Basis for it to be displayed.
Thank you. It turned out that, as you say, using a liability account was a problem. Also, since the purchases pre-dated the starting date, the expense wouldn’t appear in post-start reports. So I used an expense code called Pre-Transition expense. All OK now.
Thank you. We are a non-profit association and were members of a peak body. On 1 July there was a transition, where the peak body became the national, direct-membership organisation, and members of the state associations became members of branches of the new body. Our state association is still active, but only to complete some matters. The purchases in question were incurred pre-transition, so the liability belonged to this association, but relate to activities that we no longer carry out. Hope that makes sense.
Yes, it does. Your situation is no different from buying a business and agreeing to take on the debts of the previous owner. You simply have outstanding liabilities as the (technically) new entity begins operation. I don’t think you need to enter them as an expense at all. In fact, if you did, with dates prior to your set start date, Manager will ignore them. The Accounts payable that predate your start date, however, it will pick up as way of setting up your Accounts payable opening balances.