Accouting Rules in AR

[M. Usman]

hi, my revenue recognition is on Accrual basis
but my client receives some Annual Fee from its customer at the start of financial year (and accout for it as a liability) and amortise it (recognise revenue) on quarterly basis.

i have build Accouting Rule and schedule it on quaterly basis
and i have attached this accouting rule to the Standard/Memo line (coz my revenue is driven from Memo line)

so whenever i create an invoice it passes the following entry:

Accounts Receivables (Dr.)
Advance Fee Liability (Cr.)

Cash (Dr.)
Receivables (Cr.)
---------------------------------------------------

on the expiry of the quarter the following entry must be passed:

Advance Fee Liability (Dr.)
Fee Income (Cr.)

and i m of the opinion that this quarterly entry must be auto generated by the system coz we have created Accouting Rule to recognise revenue on the quarterly basis (and have attached that Accouting rule to my Memo Line)

but the system is not generating the quarterly entry to recognise the revenue.

so please anybody guide me on this problem
Thanking you in Anticipation

[tgs100]

Entering invoicing rules and accounting rules in memo lines are of no use if you manually enter the invoices in AR.

The invoicing rule in the invoice header should be entered as 'In Advance' and then when you enter the lines, you should enter the accounting rules and the period (from date and to date). Assume that you have entered the invoice for one year starting from 01-Apr-09 to 31-Mar-2010 for 4000 USD with quaterly accounting rule.

When you run create accounting (after revenue recognition), the accounting entries will be (all the following entries will be created when you run create accounting - Not after the expiry of the quarter)

Account - Dr/Cr - Amount - Date
=======================

Receivables - Dr - 4000 USD - 01-Apr-09
Unearned Revenue - Cr - 4000 USD - 01-Apr-09

Unearned Revenue - Dr - 1000 USD - 01-Apr-09
Revenue - Cr - 1000 USD - 01-Apr-09

Unearned Revenue - Dr - 1000 USD - 01-Jul-09
Revenue - Cr - 1000 USD - 01-Jul-09

Unearned Revenue - Dr - 1000 USD - 01-Oct-09
Revenue - Cr - 1000 USD - 01-Oct-09

Unearned Revenue - Dr - 1000 USD - 01-Jan-10
Revenue - Cr - 1000 USD - 01-Jan-10

If you see the above entries, quarterly entries are generated.

Cheers,
Saravanan TG