Deferred Expenses

Deferred Expenses enables you to defer recognition of expenses incurred across multiple General Ledger periods that you want to accrue. Use multiperiod accounting to create entries across more than one accounting period for a single accounting event.

Multiperiod Accounting

Set Up and Considerations:

Oracle Payables automatically considers an invoice for multiperiod accounting if the multiperiod start and end dates are provided on either the invoice line or invoice distributions.

You might want to edit the proration formula setup used in the predefined accounting rule to recognize the expenses. Two proration formulas are predefined by Oracle.

One is to prorate based on the number of periods
The other one is to prorate expenses based on the number of days.

Tips and Considerations

The predefined multiperiod accounting rules use the proration formula based on the number of periods.
You must configure the rules if you don't want to use the proration based on periods.
Multiperiod accounting entries are only generated when the invoice has been accounted.

Note: The predefined accounting rules use proration based on the number of periods.

Deferring Expenses

When you create a transaction with multiperiod accounting, you must enter the following:

Start Date: The date when multiperiod accounting begins.
End Date: The date when multiperiod ends.
Accrual Account: The account where the expenses are assigned until they're recognized.

Note: These columns are available for the column group multiperiod accounting and are hidden by default. The attributes are available on both the invoice line and invoice distributions. The values assigned at the invoice line level automatically default on the invoice distributions, excluding recoverable tax distributions, that you can override.

Considerations

The end date can't be changed to a date that's earlier than the last recognition journal date.

The multiperiod accounting start date and end date can't be edited after the expenses are completely recognized.

Any changes to the multiperiod accrual account don't impact the invoice after it has been accounted.

The cancellation of an invoice line or invoice distribution is always accounted on the first day of next open period, after the last multiperiod accounting recognition journal date. This is applicable despite the last multiperiod accounting date is in an open or closed period.