Accumulative Profit Definition
General Ledger Module > Configuration > general Ledger Accounts
The accumulative profit account is an internal account which works out the profit from the previous year and accumulative years into one figure.
This is automatically done per year end on Reports.
All figures that are Income statement items are rolled into the accumulative profit account.
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Parent Account and General Ledger Reporting
A parent account whereis the main account into which all subrelated sub-accounts are rolled intoconsolidated at year year-end.
TheThere differenceare important differences between report GL Report NoNo. 1 and GL Report No2.No. 2, and each report should be used for its appropriate purpose.
GL Report No. 1 is anthe auditorsauditor’s report and is the correct report to be used.
for accounting and audit purposes. This report restrictsis yourestricted to onlya runspecific financial year only. At the reportbeginning forof aeach financial year,
Allall income statement accounts are zeroedzeroed, and the figures are then accumulated month by month until the selected end period of that financial year. The report should therefore only be run for a maximum period of one financial year, or up to the end of the relevant financial period for that year.
GL Report No. 2 is a useful management report where all accounts need to be reviewed without zeroing the income statement accounts at the beginning of each yearfinancial year. This report reflects all transactions across all financial years and figuresis arehelpful addedwhere formanagement eachrequires montha until the end periodview of the report.cumulative Maximumexpense 1over year or end ofmultiple financial periodyears. ofIt should be noted that year.
GL Report No. 2 is a usefulmanagement report whenand lookingnot atan allaccounting accountsor withoutaudit zeroingreport.
There statementare accountsvarious forways to review accumulated profit. One method is to run the year.
It just shows all transactions throughout all financial years. This is helpful for a manager who wants to know what the accumulative expense was for ALL financial years. (Managers report NOT Accounting)
Various ways of looking at the Accumulative profit.
Run the report called Summary Income Report perfor each financial year and then total up the net profit.profit Rememberamounts. youThis willprocess havemust tobe do thisperformed from the first year.financial year onward.
AlsoIt needis also necessary to lookdetermine if there waswhether a balance journal insertedwas processed during the initial take-on in year one to the Accumulated Profit sub-account. This sub-account is normally used only to record an opening balance on take on from year 1 in Accumulative Profit (sub account - this is an account and normally only used to take on a balance).take-on.
Profit and Loss by Period Report
GL Module > Report List > Profit and Loss by Period Report
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Balance sheet / Financial Position report
Look at the balance sheet and go down on your last level. – GL Module >Reports >Balance sheet
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Retained Income is your income from the previous year OR and including other previous years.
Net income is your current financial year, which equals your income statement year to date on current period
Run the balance sheet for each year end and see how the accumulative profit is rolled up. If there is a problem in the Accumulative profit, it is because there is entries in the Income statement type accounts.