y*******3
发帖数: 659 | 1 I work for an export, import company started recently.
in the past,the commercial invoice is the sailing date when container leaves
the port. and vendor bill date is what is shown the vendor bill. Sometimes
there will be a difference between the vendor date & commercial invoice date
. We usually have 2 weeks to 2 month lag and receive all the vendor bills
for any transaction.
For this year end, the boss requested to match the expense against revenue,
i.e, if the vendor bill date is 1/2/2010 and |
T****2
发帖数: 82 | 2 normally we are talking whether the accounting policy is in consistent or
not in one accounting period, it could be same with fiscal year or different
, this accounting period is generally refer to one year instead of one month
.If every year ur company choose to make provision on matching principle in
year ending, that could be fine, of course, if u do every month same way,
could be best. but i don't think it's a trouble either for external audit
and tax audit. that's my opinion, if i m wrong, |
y*******3
发帖数: 659 | 3 Thanks so much to see a reply.
This year is the first to do the year ending "expense recognition" against
revenue. In 2008 year end this procedure was not done, so will this create
an understatement for the net income in 2009?
I referred this question to the company CPA, and will post here once I got
answer from him. |
p**z
发帖数: 1311 | 4 I think this only doing it for 2 months is fine..
assuming the timing differences will be corrected by itself ..
since you said you normally have max 2 months lag....something happen in Oct
shall be corrected by Dec....
as long as the expense falls in the right fiscal year, it's fine ..
I think in the current year, you'll probably add a foonote to talk about the
accounting policy changes, and talk about how much differences are you
talking about.
but then you have to consider if this is a depart |
y*******3
发帖数: 659 | 5 I got the reply from the cpa today as follows:
"The date that goods or services are accepted is the most appropriate date
for recording the expense and subsequent liability to the vendor, not the
date of the invoice or statement (we discussed this in reference to
developing a “receiver” system).
Your desire to match revenue and expense is correct. This would not
constitute a change of accounting principle just an increase in accuracy.
As I said in our discussion of a receiver system, dating th |
R*********4
发帖数: 27 | 6 It doesn't matter what vendor's invoice date is. Normally, auditors focus on
the contents of invoice. For example, if the service performed for 2008, it
's 2008 expenses.If you receive vendor's invoice late (say 02/2009), book an
estimate of expenses in 2008(accrued expenses).
Sounds to me that your company involves inventory transactions as of year
end (import/export company). If that's the case, it's another story. |
T****2
发帖数: 82 | 7 i understood the reply from ur CPA is that this is not the change of
accounting policy problem, u only made the expenses more accurate. i m
totally agree with this guy, the liability should be recongnized when the
services/ products hv been accepted instead of invoice date, so the
provision could be made based on the acceptance instead of receiving invoice
but not yet paid, but ur CPA asked u to make the provision base on the "
best date you can",, so i thought u choose invoice date could be fin |
y*******3
发帖数: 659 | 8 I have been working on this issue the past a few days, and T45872 is right.
This is not very material compared to the volume of the business in the
whole year. So I guess most vendors, when they use their revenue recognition
, it happens to be matching with our expense recognition.
Thanks everyone for your input. |
a*******9
发帖数: 174 | 9 your company don't have any reconcilation between invoices and Shipping
documents? like packing slips and invoices? and any confirmation from your
vendor every month or year -end? like call vendor for monthly invoice
statement?? this way could reduce the lag period and increase the accuracy
of revenue recognition and expense matching. let's say, if you called your
vendor and know you have some bill for Dec-09 that is not in your accounting
system yet due to mailing...you could do adjustment jour |
a*******9
发帖数: 174 | 10 a receiver system ---- per your CPA is refering accounting system between
input bills, and reconcilation with shipment documents, and confirming from
outside vendor. Plus accounting procedure about how to input bills, like the
date actually received bill, the date of servse rended, if inventory
involved, shipment method F.O.B terms. a vendor can always bill for amount
that is not received from client or customer (back bill). the best way to
determine the expense is to look at date of servse rece |
a*******9
发帖数: 174 | 11 Plus by doing a receiver system also good to your tax planning. deduct
business expenses:) by not do too much for your cash flow. since year-end
expense adjustment is just an journal entry not an actual bill.
Correct me if i am wrong. it good to learn!! |
