Cash-basis Reporting
The DPS Accounting application is an accrual-based accounting system. However, you also have the option of tracking financial data on a cash basis by using the Cash-basis Reporting feature.
- In accrual-based accounting, revenue is recognized as it is earned (through invoices) and expenses are recognized as they are incurred (through accounts payable vouchers).
- In cash-basis accounting, revenue is recognized when cash is received (through cash receipts) and expenses are recognized when cash is disbursed (through accounts payable or cash disbursements).
With the Cash-basis Reporting feature, you set up and maintain a second, separate cash-basis general ledger.
Enable the Cash-basis Reporting feature in
on the Reporting tab. Then add cash-basis accounts to the chart of accounts, enter balances for the cash-basis accounts, and map the cash-basis accounts to your accrual accounts.DPS then posts revenue and expense transactions to both your accrual-basis general ledger and your cash-basis general ledger. You can generate cash-basis financial statements in parallel with accrual-basis financial statements.
DPS supports cash-basis versions of these reports:
- Balance Sheet
- Chart of Accounts List
- Income Statement
- General Ledger Account Analysis
- Cash Journal
Considerations in Setting up Cash-basis Reporting
- Cash-basis Reporting can be set up at any time. It is best to enable Cash-basis Reporting at the beginning of a fiscal year so that you only need to translate Balance Sheet account balances, not Income Statement account balances, from an accrual to a cash basis.
- DPS begins to maintain cash-basis detail from the time that you enable Cash-basis Reporting and enter account history. For this reason, do not enable Cash-basis Reporting until you are ready to use it and have determined a cut-off date. The cut-off date is the date that Cash-basis Reporting is enabled, as well as the date on which cash-basis opening balances will be calculated.
- When you enable Cash-basis Reporting, it is enabled in all past and future periods. If you must make entries in a prior period and you do not want those entries to affect your current cash-basis account balance, you must turn off Cash-basis Reporting.
Before you enable Cash-basis Reporting, you should close all prior periods and deselect the Allow processing in closed periods option on the Accounting tab of for all of your security roles. This ensures that your cash-basis account balances remain accurate.