Use AutoInvoice to import invoices with accounting and invoicing rules if your accounting method is 'Accrual'. AutoInvoice rejects all invoices with rules if your accounting method is 'Cash Basis' because with Cash Basis Accounting, you only recognize revenue when payment is received. Invoices with rules are therefore not applicable for the Cash Basis method, as they are designed to distribute revenue over several periods before receipt of payment.
Accounting rules determine the accounting period(s) in which the revenue distributions for an invoice line are recorded. Invoicing rules determine the accounting period in which the receivable amount is recorded.
Receivables provides two invoicing rules: Bill in Advance and Bill in Arrears. You supply AutoInvoice with the model account which contains the accounting distributions and the percent allocated to each account. You must run the Revenue Recognition Program before Receivables can create your accounting entries. See the example below for the effects of using accounting and invoicing rules through AutoInvoice. Assume that you have already run the Revenue Recognition Program for each accounting period.
Invoice #101
Transaction Amount: $300
(RA_INTERFACE_LINES.QUANTITY (3)*
RA_INTERFACE_LINES.UNIT_SELLING_PRICE ($100))
Accounting Rule: Monthly
(RA_INTERFACE_LINES.ACCOUNTING_RULE_ID)
Invoicing Rule: Bill in Advance
(RA_INTERFACE_LINES.INVOICING_RULE_ID)
Duration (Number of Periods): 3
(RA_INTERFACE_LINES.ACCOUNTING_RULE_DURATION)
Rule Start Date: 1/1/XX
(RA_INTERFACE_LINES.RULE_START_DATE)
Payment Term: Net 30
(RA_INTERFACE_LINES.TERM_ID)
Receivables creates the following accounting entries as illustrated in this table:
| Period | Account | Debit | Credit |
|---|---|---|---|
| 1/1/XX | Accounts Receivable | 300 | |
| 1/1/XX | Unearned Revenue | 200 | |
| 1/1/XX | Revenue | 100 | |
| 2/1/XX | Unearned Revenue | 100 | |
| 2/1/XX | Revenue | 100 | |
| 3/1/XX | Unearned Revenue | 100 | |
| 3/1/XX | Revenue | 100 |
In the above example, the transaction date for this invoice is 1/1/XX, with a payment due date of 1/31/XX. If we had chosen an invoicing rule of 'Bill in Arrears', the transaction date in the above example would have been 3/1/XX with a payment due date of 3/31/XX.
For a description of how Receivables determines GL dates when importing invoices with rules, see Determining Dates.
Besides validating dates, AutoInvoice also validates and rejects lines if:
The accounting rule has overlapping periods
All of the accounting periods do not exist for the duration of your accounting rule