Prepayment Amortization

The Prepayment Amortization page allows users to manage and track prepayments over time by setting up amortization schedules. This feature is essential for organizations that handle large prepayment transactions and want to spread the expense recognition over a specific period, rather than recording the entire amount in a single period. By using this feature, users can ensure financial transparency and compliance while managing prepayments efficiently.

Accessing The Prepayment Amortization Page

1. Log into the application using your credentials.

2. From the dashboard, navigate to Accounts in the side menu.

3. Select Prepayment Amortization from the dropdown list.

Creating a New Prepayment Amortization

To create a new prepayment amortization, follow these steps:

1. Click the Add button in the top-left corner of the Prepayment Amortization page.

2. Complete the fields as required:

   • Prepayment Name: Enter the name for the prepayment.

   • Prepayment Description: Provide a brief description of the prepayment.

   • Branch of Use: Select the branch where the prepayment will be used.

   • Existence: Indicate whether the prepayment already exists or is new. Note: The toggle button for Already Existing and Not Existing is to be selected. If the toggle button is set to "Already Existing" it means the system will not re-attempt to post the original entry of the prepayment because its assumed to have been posted into the books at the initial point of the prepayment. Where toggle is set to Already Existing, it is very important that the data inputer key-in the accurate period already utilized as well as the accurate cumulative amortized value to date. If the toggle button is set to "Not Existing" it means the original entry posting of the prepayment has not been posted into the books before, hence the system will post the original entry accounting between the Prepayment Asset class and the Payment source account.

   • Prepayment Amount: Enter the total amount of the Prepayment.

   • Prepayment Category: Choose the appropriate category of the Prepayment.

   • Utilization Start Date: Select the date the prepayment starts being utilized.

   • Total Coverage Period (in months): Enter the duration of coverage in months.

   • Periods Already Utilized (in months): Specify the number of months already utilized.

   • Un-utilized Coverage Period (in months): Enter the remaining coverage period.

   • Cumm. Amortized Value: Input the cumulative amortized value to date.

   • Net Prepayment Value: System automatically determine the estimated net prepayment value.

   • Monthly Amortized Value: System automatically determines the estimated monthly amortization value.

3. Set the GL accounts:

   • Prepayment GL: Select the general ledger account for the Prepayment.

   • Payment Source GL: Select the general ledger account for the payment source.

   • Amortization Expense GL: Select the general ledger account for amortization expenses.

4. Click the Save button to create the prepayment.

5. Confirm the action by selecting “Yes, I want to proceed.”

Modify A Prepayment Amortization

Here's how to modify a Prepayment Amortization below:

1. Select Modify from the dropdown menu.

2. Update the necessary Prepayment Amortization details.

3. Click Update to save and apply the changes.

4. Confirm the action by selecting “Yes, I want to proceed.”

Activate/Deactivate A Prepayment Amortization:

To activate/deactivate an existing Prepayment Amortization:

1. In the Actions column, click the three vertical dots (⋮) next to the Prepayment Amortization you wish to deactivate.

2. Select Deactivate from the dropdown menu.

3. Confirm the action by selecting “Yes, I want to proceed.”