Adjustments in ADB

ADB adjustments are any transactions for a specific period that have been posted to the ADB ledger after ADB calculations have been run, which includes that period in the average balances.

For example, suppose average balances are calculated at 8:30 a.m. on Monday as of period 1. Additional transactions are posted to the ADB ledger at 9:00 a.m. that same day. These new transactions are considered ADB adjustments.

If the ADB process is using the incremental calculation method, the process automatically adjusts prior period balances before it calculates the requested period averages because the incremental calculation method uses prior period balances to calculate the current period averages (thus the adjustments must first be applied to those prior balances).

Note:

The ADB process does not require you to go back and rerun prior month balances for the same fiscal year in order to adjust prior period balances when using the incremental calculation method. For example, if you have adjustments in May and June and the averages are already calculated up to July 31, you do not have to rerun the ADB Calculation process for the month end of May and June. You can rerun the ADB calculation process as of July 31 or as of August 1. The ADB process automatically adjust the prior months balances, for May and June, as long as the adjustments are within the same fiscal year. If you were to rerun the balances as of May 31, the process would not properly adjust the balances in June and July.

If the ADB process is not using the incremental calculation method, then the process does not have ending balances.

When using the ad hoc method, you have to run the process for every open month for which you have transactions.

The ADB process adjusts all average balances starting from the minimum accounting period of the ADB adjustments, as long as that accounting period is within the same fiscal year as that of the requested period.

Keep in mind the distinction between ADB adjustments and adjusting journals (which are posted to special adjustment periods). They are different and are processed by ADB differently.