You have flexibility to code bills to either the relevant expense account or one or more dedicated prepayment balance sheet accounts - or even mix both methods.
Benefits of coding to the balance sheet
- No need to confirm prepayments in ScaleXP: bills coded to the prepayments account are included automatically.
- It is easier to spot missing or incorrect date ranges on bills and spent money.
- ScaleXP learns the right expense account for each supplier.
- All prepayments are easy to track in one prepayment asset account.
Benefits of coding to the expense account
- No need to choose an expense account in ScaleXP.
You can prepay bills that are coded to a prepayments account, but you cannot accrue expenses that are already posted to the accruals account.
If you code to the balance sheet, you will be given the opportunity to choose the proper expense account for each supplier, bill or line item to end up in for the journal. You do this in the Expense account column of Select Prepayments, Section 1.
If you use multiple balance sheet accounts for prepayments, you'll need to map prepayment accounts to expense accounts to ensure the cost is allocated to the right balance sheet account. See Setup 2: Choose your settings.
Only one liability account is supported for accrued expenses. See Accruals: Add, release, and post accruals.