Relationship Between Aggregate and Average Balances
When you enable average balance processing in General Ledger, the system calculates and stores three aggregate balances for each balance sheet account in your set of books, for every calendar day. The three amounts are the period-to-date, quarter-to-date, and year-to-date aggregate balances. Every time you post a transaction, General Ledger updates the standard period-end balances, as well as the three aggregate balances.
Note that General Ledger does not actually store average or end-of-day balances. Instead, the system performs a quick and simple calculation whenever you need one of these balances. For example, when you perform an on-line inquiry or run a report, the required average balances are quickly calculated from the aggregate balances, using the following simple formulas:
Average balance = aggregate balance divided by number of days in the range.
End-of-day balance = current day's aggregate balance minus previous day's aggregate balance.
This relationship between aggregate and average balances is a key concept in General Ledger average balance processing. Throughout the remainder of this document, whenever we refer to tracking average balances, average balance processing, or maintaining average balances, we are implicitly referring to the relationship described above.
Types of Average Balances
To satisfy different reporting and analysis requirements, General Ledger can track three types of average balances:
Note: General Ledger tracks average balances for actual transactions only. You cannot track average balances for budget or encumbrance balances.
See Also
General Example
Example: Period Average-to-Date Balance
Example: Quarter Average-to-Date Balance
Example: Year Average-to-Date Balance
