CHAPTER 9: FINANCIAL STATEMENT FORMATTING

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1 Chapter 9: Financial Statement Formatting CHAPTER 9: FINANCIAL STATEMENT FORMATTING Training Objectives Actively participating in this chapter helps you: Set up Quick Financial statements Learn additional formatting options for financial reports Page 251

2 Microsoft Dynamics GP General Ledger Quick Financial Statements REPORTS FINANCIAL QUICK FINANCIAL General Ledger allows you to define and print four types of financial statements: Balance Sheet Profit and Loss Statement Cash Flows Statement Retained Earnings Statement Using the Quick Financial Setup window, you can quickly define the layout for financial statements. Financial statements must be set up before you can print them in Microsoft Dynamics GP. Report If you are setting up a financial statement for the first time, enter a report name identifying the statement. The report name entered here appears below your company's name on the financial statement. You can create an unlimited number of financial statement layouts. Page 252

3 Chapter 9: Financial Statement Formatting Type The four types of financial statements include the following: Balance Sheet The Balance Sheet does the following: Reflects the solvency and financial position of your company at a specific point in time. Lists the assets and liabilities of your company. Shows your company's ability to pay its debts. Profit and Loss Statement The Profit and Loss Statement features: Revenues Expenses This reflects the profitability of your company for a specific time period, such as a month or year. Statement of Cash Flows The Statement of Cash Flows provides information about: Cash receipts Cash payments Account balance Statement of Retained Earnings The Statement of Retained Earnings shows the items causing changes to your retained earnings. This includes: Net income Declared dividends Net Income/Loss Source At times, you need to identify the Profit and Loss Statement that provides the net income or net loss source amount. You must do this when you are defining the layout for the following: Balance sheet Statement of Cash flows Statement of Retained Earnings If you are setting up a Profit and Loss Statement, an entry is not required because the net income or net loss amount is calculated on the statement itself. HINT: Because the Balance Sheet report type requires a Net Profit/Loss Source, you must set up a Profit and Loss Statement before setting up a Balance Sheet. Page 253

4 Microsoft Dynamics GP General Ledger Define the Layout Each financial statement includes a number of required columns that must be printed on the statement. These appear under the Selected Columns heading in the scrolling window. In addition to these required columns, you can insert additional column options for each financial statement. On your Profit and Loss Statement and Statement of Cash Flows, you can use a total of six columns. On your Balance Sheet, you can use a total of five columns. On the Statement of Retained Earnings, you can use a total of four columns. Profit and Loss Statement Balance Sheet 6 columns maximum 5 columns maximum Col 1: Description Col 1: Description Col 2: Current Period Col 2. Year-to-date Col 3: Year-to-date Col 3-5: Optional Col 4-6: Optional Highlight the optional columns you want added and click Insert. The selections appear under the Selected Column heading in the scrolling window and are included when calculating and printing the financial statement. You can add optional columns only below a required column. You cannot insert an optional column between two other optional columns or at the top of the list. HINT: The order of the optional columns in the Selected Columns window is the order they are printed on the statement. Using Advanced Financial Analysis, you can add report columns later or move columns to new locations. To remove columns from the layout, highlight them and click Remove. Required columns cannot be removed. The rows in the financial statement are automatically defined by using General Ledger's account categories to group the accounts on the statements. Budget and History Information If you include a column for Budget YTD or Budget Current on a statement layout, you must select a budget to provide information for the column. You can select only one budget per report. If you include a column for History YTD or History Current on a statement layout, you must select one previous year to provide history information for the column. The Ratio column shows the percent of sales for the Profit and Loss Statement and the Percent of Assets for the Balance Sheet. Page 254

5 Chapter 9: Financial Statement Formatting Quick Financial Statements Printing Options REPORTS FINANCIAL FINANCIAL STATMENTS In Microsoft Dynamics GP, you can set up financial statement printing options for example, how much detail will be shown. This makes it easier to print financial statements in formats that commonly reflect the business practices of your company. If you are keeping a history, Microsoft Dynamics GP reporting capabilities allow you to compare current and previous-year figures. You can also print financial statements for any period in the current year or in a previous year. If you want to print a financial statement for a period other than the current period, change the user date by selecting User Date from the File menu. When you print the financial statement, it is based on the user date you entered. You cannot select a report name unless you first create a layout for it in the Quick Financial Setup window. Printing a Statement of Retained Earnings If you are printing a Statement of Retained Earnings and want to enter a prior period adjustment, select Prior Period Adj. from the Financial Reports palette. The description and amount of the adjustment you enter here appears as an adjustment to the beginning balance of the Retained Earnings account when you print the statement. Adjustments to Retained Earnings accounts are required in a number of different situations. For example, you might want to enter an adjustment if you changed your method of inventory valuation and the Inventory account is either overstated or understated as a result. Prior Period Adjustments do not affect the General Ledger. Selecting a Report Select an existing report from the Report Name lookup list. The names displayed here are for the layouts you created in the Quick Financial Setup window. The system cannot accept report names for which no financial report layout exists. Creating or Selecting a Report Option If you previously created a report option and want to change it now, select the option name in the Options window and click Modify. Then make the appropriate changes and save the new option. If you want to create a new report option for the selected financial statement, click New to open the Financial Statement Report Options window. Page 255

6 Microsoft Dynamics GP General Ledger Print Amounts Determine the amount of detail that is printed on the report. The options are: Detail Summary No Detail The statement includes the descriptions and balances for the range of accounts you selected. The statement summarizes all detail information by account category. Only the account category or first account in the category will be printed. Rows showing only totals appear on the report. HINT: Detail w/rollups and Summary w/rollups are used with Advanced Financial Analysis reports and are discussed later in this manual. The following examples show how the rows in a financial statement look for each level of detail. DETAIL DESCRIPTION ACCOUNT AMOUNT Cash First Bank 1100 $ Cash State Bank 1101 $ Petty Cash 1102 $ Total Cash $ Accounts Receivable 1200 $ Accounts Receivable Employee 1201 $ Total Accounts Receivable $ Notes Receivable 1500 $ Notes Receivable Employees Total Notes Receivable $ SUMMARY DESCRIPTION ACCOUNT AMOUNT Cash $ Total Cash $ Accounts Receivable $ Total Accounts Receivable $ Notes Receivable $ Total Notes Receivable $ Amounts for accounts in each category appear as summary totals. Page 256

7 Chapter 9: Financial Statement Formatting NO DETAIL DESCRIPTION ACCOUNT AMOUNT Total Cash $ Total Accounts Receivable $ Total Notes Receivable $ Amounts for accounts in each category appear as summary totals. Print Description If you selected Summary as the level of detail, decide whether you want to view the description of each account category or the first valid account in each category on the statement. Then choose the appropriate selection. The statement displays the following: Description you selected Balance of the account category Print Options Select the Zero Balances option if you want to print accounts with zero balances. If this option is not selected, only the accounts that carry balances are printed on the report. The Unit Accounts option applies only to financial statements created using Advanced Financial Analysis. Use Accelerator This applies only to financial statements created using Advanced Financial Analysis. Refer to the information on Advanced Financial Analysis in this section. Account Range Restrictions You can print a financial statement for a range of account segments by entering a range. Select a segment and then a range of values for the selected segment. Click Insert, and the selected segment restriction should be in the Restrictions list. You can print financial statements for any range of account segments you have entered. Only accounts that meet the restriction requirements appear on the financial statement. If you do not specify any restrictions, all accounts are included on the report. Page 257

8 Microsoft Dynamics GP General Ledger Individual Reports If you want to print individual reports for each account segment within the selected range, select Individual Reports. A summary report prints, followed by the individual reports. If you clear this check box, a single report is printed, including all accounts in the selected range. Calculate Ratio Ratios reported on Balance Sheets represent a percentage of assets, while ratios on Profit and Loss Statements represent a percentage of net sales. If you want to base the ratio using all account segments, select All. If you select Each Report, the system bases the ratio calculation on the segment totals entered for each individual report. HINT: If you did not select to print individual reports, you cannot choose a method of ratio calculation because you are printing one report, which uses one ratio calculation based on the segment ranges you have selected. Destination To select printing destinations, click Destination. Financial statements can be printed to either one or a combination of the following: Screen Printer File If you select Ask Each Time, you can determine a printing destination each time you print this financial statement option. If you do not want to select printing destinations each time you print, clear the Ask Each Time option. The report is automatically sent to the destination you selected previously. Print the Financial Statement You can print the financial statement option from the Financial Statement Report Options window before saving it. If you do not want to print the option now, click Save and close the window. The Financial Statement Report window becomes active. Select the financial statement options you want to print, and click Insert to insert them in the Print list. You can print one or more options by inserting them in the Print List and clicking Print. Page 258

9 Chapter 9: Financial Statement Formatting Advanced Financial Analysis REPORTS FINANCIAL ADVANCED FINANCIAL Advanced Financial Analysis Overview Using Advanced Financial Analysis, you can create new reports or customize existing reports that were created using the Quick Financial Setup window. The formats for these statements can be saved and then printed with updated information. The primary window used in Advanced Financial Analysis is the Advanced Financial Report Layout window. Use this window to create new reports or customize existing financial statements. Page 259

10 Microsoft Dynamics GP General Ledger Modify Financial Statements If are starting to use Advanced Financial Analysis, make simple modifications to an existing financial statement before creating one of your own. Financial statements can be created in General Ledger using the Quick Financial Setup window. Select a Report Select a report in the Advanced Financial Report window and click Open. Once a report is displayed, you can perform the following functions by clicking the Display button: Make changes to the headers and footers Add columns for other calculations Add rows for totaling amounts HINT: We recommend you set up a report in the Quick Financial Setup window to use specifically for experimenting in Advanced Financial Analysis. You also can use the Duplicate button in the Advanced Financial Report window to create a copy of an existing report, and then use the copy to practice. The report name and report type appear as defaults in the Advanced Financial Report Definition window. You can change the report that has been used to calculate the net income or loss on the report if the report is one of the following: Balance Sheet Statement of Cash Flows Statement of Retaining Earnings If the report is a Profit and Loss Statement, the net income or loss is based on the report you are creating. HINT: Reports modified using Advanced Financial Analysis cannot be reopened in the Quick Financial Setup window in General Ledger because the report layout might have been modified. Page 260

11 Chapter 9: Financial Statement Formatting Using the Accelerator File If you have been updating the accelerator file and want to use the updated information when printing the financial statements, select this check box when setting up the report option. If you have formatted your financial statement using account categories only, you will NOT want to select this check box (as is the case when printing Quick Financial reports). In this case, using the accelerator file information does expedite the printing of financial statements. If you are printing a financial statement for a report option that has a status of Invalid and you select this check box, the system updates the accelerator file during the printing process. This slows the printing process for this financial statement. We recommend that you update the accelerator file using the Update Accelerator Information window. Then choose to use the updated information by selecting the Use Accelerator check box on the report option. Accelerator File Q & A What information is contained in the Accelerator file? The Accelerator file stores the following information for the posting and unit accounts that have been formatted on statements. Account number Account description Posting type (Balance Sheet or Profit and Loss) Typical balance (debit or credit) When does the Accelerator file get created? The Accelerator file is created before or during the printing of financial statements. To create the accelerator file before printing, follow these steps: 1. Open the Update Financial Accelerator Information window. 2. Insert the appropriate report name and report option in the Selected Report Options scrolling window. 3. Click Update. To create the file when printing financial statements, choose the Use Accelerator check box in the Financial Statement Report Options window. HINT: We recommend that you update the Accelerator file before printing financial statements. If it is updated during printing, the printing process is slower. Page 261

12 Microsoft Dynamics GP General Ledger What might cause the Accelerator file to be invalid for a report option? Report options that are selected to use the Accelerator file become invalid when changes are made to your chart of accounts using: Account Maintenance Unit Account Maintenance Mass Modify Chart of Accounts Year-end Closing Also, modifying a report layout when the Update Accelerator File check box in General Ledger Setup is not marked causes the status of a report option to become invalid. Will the Accelerator file always provide faster financial statement printing? No. If your financial statements are formatted using account category row types, the Accelerator file does expedite the printing process. Quick Financial Setup layouts create financial statements using the account category row types. Those financial statement layouts that use many account ranges, row types, and wildcarding have the greatest improvements in processing time. If a financial statement uses account range row types without much wildcarding, the improvement in processing time is not as significant. How much faster do financial statements print if the Accelerator file is used? This depends on many factors, including the hardware configuration and the financial statement format. Why can't the Accelerator file be used when "Individual Reports" is selected in the Financial Statement Report Options window? Think of the Accelerator file as a "snapshot" of the information contained in the financial row layout. When printing individual reports, what appears on the statement would not match the picture on the row contained in the Accelerator file. This is why we recommend that you set up multiple report options for individual statements so you can use the Accelerator file for each option. Page 262

13 Chapter 9: Financial Statement Formatting Other AFA Printing Features Print Amounts Determine the amount of detail to print on the report. Detail Detail with Rollups Summary Summary with Rollups No Detail The statement includes the descriptions and balances for the range of accounts you select. The amounts are rolled up for the selected rows and summary information for the row appears on the report. Detailed information prints for all other rows on the report. The statement summarizes all detail information by account category and only the account category or first account in the category is printed. The amounts are rolled up for the selected rows and summary information for all other rows appears on the report. Rows showing only totals appear on the report. Page 263

14 Microsoft Dynamics GP General Ledger Lab 9.1 Quick Financial Setup Company: Fabrikam Inc. Scenario: Your current Profit and Loss statement contains only current year information. You would like more information for comparative purposes. Create a Quick Financial statement for a Profit and Loss Statement with historical year comparative information. Challenge Yourself! Complete the setup for a Quick Financial report for a Profit and Loss Statement with the information provided below: Report Profit and Loss with History Optional Columns Ratio Current History YTD History Open Year 2007 History Year 2003 Save the report setup once completed. Page 264

15 Chapter 9: Financial Statement Formatting Lab 9.1 Quick Financial Setup Company: Fabrikam Inc. Scenario: Your current Profit and Loss statement contains only current year information. You would like more information for comparative purposes. Create a Quick Financial statement for a Profit and Loss Statement with historical year comparative information. Need a little help? Follow these steps: 1. Navigate to the Quick Financial Setup window. (REPORTS FINANCIAL QUICK FINANCIAL) 2. Enter the following information: Report Type Profit and Loss with History Profit and Loss Note that three fields are defaulted under the Selected Columns. You want to add additional fields to this report. Insert the following fields into the Selected Columns: Optional Columns Ratio Current History YTD History 3. Select 2007 as the Open year and 2003 as the History year. 4. Save the report. Page 265

16 Microsoft Dynamics GP General Ledger Lab 9.2 Quick Financial, Report Options Company: Fabrikam Inc. Scenario: In the previous exercise, you created a Quick Financial, Profit, and Loss with History report. Now create a report option to print the report. Challenge Yourself! Follow these steps: 1. Create a report printing option for the Profit and Loss with History report using the Financial Statement Report Options window. Accept the defaults for information not provided below: Option Amounts Description Destination Summary Summary Category/Row Screen 2. Save the report printing option. 3. Print the report to the screen. Page 266

17 Chapter 9: Financial Statement Formatting Lab 9.2 Quick Financial, Report Options Company: Fabrikam Inc. Scenario: In the previous exercise you created a Quick Financial, Profit, and Loss with History report. Now create a report option to print the report. Need a Little Help? Follow these steps: 1. Navigate to the Financial Statement Report window (REPORTS FINANCIAL FINANCIAL STATEMENTS). 2. Click on the Report field select Profit and Loss with History. 3. Click the New button to create a new report option with the following information: Option Amounts Description Destination Summary Summary Category/Row Screen 4. Save the report option. 5. Print the report to the screen. Page 267

18 Microsoft Dynamics GP General Ledger Quick Interaction: Lessons Learned Take a moment to write down three Key Points you learned in this chapter: Page 268