HOPE System Guide Control System 12/6/94 Page 145

Accounting - Detailed Steps

TRIAL BALANCE AND POSTING

When all journal entries for the month have been entered, you may run a Trial Balance on the month's Transaction File. To run a Trial Balance:

.Choose "Trial Balance and Posting" from the Financial Statements Menu

Posting is the procedure by which HOPE enters the month's journal transactions into the appropriate accounts in the Chart of Accounts. Posting also adds your income (revenue minus expenses) for the month into the Retained Earnings account. When you post, the transaction amounts in the Journal File are added to both the "current" column and the "year-to-date" column in the Chart of Accounts.

The posted transactions are sorted by account number and printed. This is your "Audit Trail." The process of posting and printing the Audit Trail can take as long as 10 minutes to print depending on the number of transactions during the month. Therefore, be sure you have enough time to run the posting procedure before doing so. You may avoid printing, and cut the time down significantly, by choosing "N" to the questions "Print Journal Entries" and/or "Print Account Transactions". The print files will still be saved and may be recalled and displayed or printed at any time.

The End-of-Month Procedures give complete instructions regarding when to perform a Trial Balance and when to post your month's journal records. Refer to those instructions before posting.

You may print the Trial Balance if you wish (Appendix A has example). The Trial Balance will indicate whether Assets balance Liabilities plus Owner Equities. If they do not, then there is an error which needs correcting. Review your journal records (you may print the Journal File if you have not already) and figure out what revisions or additions are necessary (look at your Journal File listing and see which transaction does not total to zero). Do not run financial statements until Assets balance Liabilities plus Owner Equities. After making the necessary adjustments, print another Trail Balance to check that your revisions have corrected the error.

Once the Trial Balance indicates a balance, you may run financial statements.

PRINTING THE PROFIT AND LOSS STATEMENT

The Profit and Loss Statement (Income Statement) is calculated by using the information available in the "Current" amounts contained in the Chart of Accounts. Figures are calculated on a delivered sales basis. (See Appendix A for an example). To print the Profit and Loss Statement:

.Choose "Print Profit and Loss Statement" from the Financial Statements Menu