This year-end webinar for Sage X3 processing for 2020 covers:
Today's session will be on Sage X3 year-end planning and 1099 processing today Doug Hart and Ed Halloran will be our presenters.
Doug is a senior ERP consultant he has worked with various ERP solutions since 2000. Doug's vast background has allowed him to be involved in hundreds of projects at many different levels, from kickoff to developing custom applications. Doug is truly an asset to us here at RKL.
We will also have Leanne, our customer support specialist, coming in at the end should you have any other questions maybe specifically on 1099.
Ed will be on the line in support of Doug today; Ed is a senior Sage X3 architect, he has been with RKL for over 10 years and has been working with the Sage consulting world for over 20 and has a specialty in Sage X3 financials, distribution, costing and fixed assets.
Don't forget your RKL account reps are Gia Lane on the East Coast and Mike Share on the West Coast, please don't hesitate to contact them should you have any questions regarding your Sage solution.
So without delay let's get started, Doug?
Thanks Danica, so welcome everyone hope you will find today's session helpful we're going to go ahead and jump right in and go ahead and just cover our agenda here we will walk through a year-end checklist of tasks that you'll need to perform prior to doing your year-end close. We'll also cover some managerial reports that will help you wrap up that year-end process. We'll walk through the actual closing of the last fiscal period and year, and we will discuss some financial reporting aspects and some other considerations, including generating your 1099s and updating default date parameters for your Sage X3 reports.
So our goal is to give you an overview of the steps that you'll need to close out the year. If you've done a period end close before, it's very similar to that process, but there are some specific tasks that are required for year-end
Before we do get started, just make a mental note that fiscal year end does not have to be closed immediately, it's recommended to keep the year open until you've got your final audit entries processed and you can run the year-end simulation function before performing the actual close. By running the simulation there are no journals created and the fiscal year is not officially closed, however it does roll forward the balance sheet balances and this allows you to run trial balance for the new year without having formally closed the current year. This simulation also will update the beginning balances for most reports and inquiry screens but you will need to make certain that the fiscal year end flag for those reports is either included or excluded as required for analysis
So we've got a few items listed here that relate to operational transactions that need to be processed all the way through the system before you can do your period or your end close so you'll want to make sure that your receipts and deliveries have been validated and invoiced that your sales invoices and credit memos have been posted your purchase invoices and credit memos have been posted and that all payments have been posted you'll also want to consider running the dimension balance recovery function which allows Sage X3 to resync the tables in which dimension balances are stored if you're a manufacturer or distributor you'll want to make sure that you've done your physical inventory if you have subcontracting you'll want to make sure that those subcontracting costs have been calculated and posted and you want to make sure that the stock accounting interface and the web accounting interface have both been posted and do not generate any errors and you'll notice that we've referenced the Sage X3 function names for most of the tasks here as each bullet point indicates here at the FUNCFMINV for example for your sales invoices BPCVAL for credit memos.
Some financial considerations to walk through before you do your closing: You want to make sure that your accrual entries have been created and their reversals have been generated. If need be, you'll want to generate your recurring entries if you have any, and if you're not running the fixed asset module that you've generated depreciation entries. If you do have intercompany transactions you want to make sure that you've verified those intercompany balances the due to and due from balances within each entity. You'll want to review the accounts for all of your variants and clearing accounts such as your received, not invoice, and your suspense account.
If you have a non-stock managed product that isn't going to go through the purchase receipt process then you'll want to make sure that you've accrued for any non-inventory items that you may have received but do not have the vendor or suppliers invoice for you want to reconcile that RNI account against those receipts and you'll want to make sure that you've generated your multi-currency revaluation entries if you are processing in more than one currency.
You might also want to take this opportunity to review your dimensional allocations to ensure that the rules that you've set up for dimension postings has been adhered to, so if you've got a requirement that all expenses have a department populated, for example. Just review those expense entries to ensure that that's the case and in order to do the period end you will have to make sure that any simulated journal entries have been either deleted or made actual as that period and process won't allow you to move forward with those simulated entries.
If you are using the fixed asset module then you'll want to review the posting type in the depreciation context to ensure that all periods are set to actual when you set up those fiscal periods Sage X3 does default that posting type to simulation so you want to ensure that those have been flipped to actual you want to make sure that the journal entries for depreciation have been posted through and you'll want to go review the status of contexts in fixed assets processings block to ensure that all the lights are green for your inactive calculated and posted elements so that you can be sure that the period and close can proceed for fixed assets and unlike general ledger the fixed asset periods cannot be reopened so you do want to make sure that you've got everything properly processed through before you do run through that closing of the fixed asset period and the fixed asset period does have to be closed before you can close the GL period.
You'll also want to ensure that you've performed the bank reconciliation for each of your bank accounts and tie those to the appropriate statement.
You may also want to be mindful of the fact that you can restrict postings in a couple of different ways with the next three to prevent the user from posting a transaction through when you are at the point where you're ready to perform your period and close so you can lock those down either by module to prevent users from being able to enter purchase invoices or journal and batch entries customer invoices supplier invoices payments open item statements entry of expense lines and automatic payment proposals and sales invoices in addition to being able to enforce those instructions at the module level you can also enforce some restrictions based on the document type date range by setting the validity date or at the journal code level by setting the journal code to deactivated or by using general code access codes.
One thing to note the general ledger detail report that you can run to view the transactions that have been posted in the system the out of the box version does not include the entered date or the the system date and time at which the entries were posted nor does it include the user id so if you would like to have that information available to you you can certainly add those fields if you're comfortable with modifying crystal reports if you don't have any in-house crystal expertise then you can certainly reach out to RKL we've provided that modification to the general ledger detail report for their clients and would be happy to work with you to get that taken care of for your company if you would find that useful it's a fairly quick and easy modification to the crystal report that gives you a fair amount of value for chasing down those entries that may have been put through the system after the point you thought that you had prepped the module for closing.
So we've listed some of the reports that you'd want to consider running at the end of the period here and some of these report names may be new to you the report codes may be new to you these are changed some of them have changed in V12 so the ball age group for your customer or supplier aging the battle age group dev for the GL trial balance.
You might also want to consider a requester that RKL has developed for matching the detail for your RNI account as long as you are posting your receipts in full so not doing any partial receipts that requester will should work for you we also have in the fixed asset module of FAS list depth report for your fixed asset listing again the out of the box version is missing a few things that I think most clients would find helpful for one the accumulated depreciation and another item that's missing would be the ability to group the report by for example the family or group code that you would tie to your assets so RKL again has modified that for clients to add those additional fields and grouping options to the crystal report so if that would be of interest to you feel free to reach out to either your RKL consultant or to a member of our support team.
We also have developed a z-whip requester so that's a custom requester that gives you the ability to tie out what you have in your work in process account and reconcile it on a work order by work order basis so it definitely helps to simplify that reconciliation process by having that level of detail
You'll want to ensure that you've run through the final validation of your journal entries for all remaining temporary 2020 entries and review the pre-closing report to identify any blocking errors for the period and process if you've run period end processing before you're probably familiar with that clopper report that gives you that detail for those issues that might prevent you from performing the close.
You'll want to ensure that you do your stock close first before you do your period close and if you are performing that period close in the final month of your fiscal year it will notify you to that fact when you go to do that and before you do that closed process you do want to ensure that you do have at least the first period of the coming year set to be open so that you won't have any issues posting to that next period.
so when you're ready to run the actual closing you do want to make sure that all of the users have logged out of Sage X3 and keep in mind that the journal monitor the EDI monitor and the ADC monitor do all need to be stopped because those are each considered to be users in Sage X3's environment so you will need to make sure that those have stopped and you'll want to turn off your accounting tasks you want to also confirm that the new PR journal and new PR document type exist those are used to create those closing entries for the year.
You'll also want to take a moment to review the sequence numbers for your document types to ensure that those are set to either roll forward or not as you wish for the new year and then you'll also want to verify the parameters for your analytical balance forward and GL balance forward to make sure that those are both set to yes.
You'll also want to pop into the chart of accounts function and review the miscellaneous accounts tab and confirm that line 11 does contain your retained earnings account any other lines in that screen are not used for the closing process but you may need values populated in those lines in order to avoid generating errors unlike the fixed asset period the GL year can be reopened in order to enter any audit adjustments after the fact if need be. The actual function to perform that year-end close is found under your financials block in the closing processing's fiscal year end function as I mentioned earlier you can run the simulation first by checking the simulation box that's in the center of the screenshot we've got here and that will help you to identify any potential errors that might pop up during the close process.
If you have cleared the checkbox and go ahead and move forward with the actual close that will create the journal entries it'll close those profit and loss accounts into your retained earnings account and establish the proper beginning balances for your balance sheet accounts. You'll want to take this opportunity to also use either sage enterprise intelligence or financial data extractor to verify your report balances at your end and make sure that the ending balances for 12-31 2020 tie out to your beginning balances for 1-1 of 2021.
If you're maintaining budgets in Sage X3 you do have a couple of options for handling the budgets for the new year you can either create new budget codes for the 2021 year or you can import your 2021 budget amounts into your existing budget codes just a note here that if you are using SEI for your financial reporting it may save you some time and aggravation to use those existing budget codes that may already be mapped into your financial reports rather than creating new budget codes for 2021.
For operational budgets you want to make sure that your carryover budgets have been calculated if need be and if you're maintaining price lists in Sage X3 for either sales or purchasing you'll want to review those to ensure that those are updated for the coming year if need be remember that you can import either those sales price lists or the purchasing price lists and you do want to be mindful of the dates that are the validity dates that are set up for those price lists to ensure you don't have a gap between the end of one price list period and the beginning of the following priceless period.
If you have product that you are maintaining at standard cost the system will continue to use the old standard cost until a 2021 standard has been created you can copy the current raw material standard to a simulated cost then update your raw material simulated standards and perform your BOM cost roll up on the finished goods in order to get those simulated costs and then copy those 2021 costs that are simulated into your 2021 standard costs.
Arighty, so for those of you who are required to file form 1099 for supplier payments you've probably heard that there's a new 1099 form that was introduced by the IRS in 2020 it's form 1099 NEC - that particular form if you do need to process that non-employee comp for your suppliers you need to apply the 2020 form 1099 patch for version 11 and 12.
To get to the 1099 processing you would go to the feed declaration united states processing block and then in that section you can see on the screenshot over on the right hand side the payment amounts can be edited using the 1099 payment summary function so if you happen to have either migrated to x3 mid-year and had not updated the 1099 beginning balance for payments that were issued from your previous ERP system or if you had failed to track 1099 payments earlier in the year for a particular vendor you can come in and edit those amounts in the task here and then down in the processing section is where you would actually perform the calculation of those 1099 payments once you've verified that those 1099 payment amounts are correct and actually print those forms
Sage X3 does not print the formatted IRS forms it will print the data onto pre-printed forms so you can go to any office supply store pick up those pre-printed forms and then drop them in your printer and Sage X3 will drop the data into the appropriate location for each box
Danica: Hey Doug, this is Danica, we have a couple questions
Doug: Yes
Danica: Are there any form constraints for the 1096-1099 forms in Sage X3 or are general forms from office supply stores adequate, you just said that, they are on version 7 will they still be able to patch for the 1099 NEC
Doug: So I believe we may have Leanne Segan on the line and Leanne wrote a blog for RKL's website that covers the details of the 1099 NEC, is Leanne on?
Leanne: I am on currently there was an update that was for 2019 in January that was one patch that will allow versions 9 and up to be able to start setting up the NEC form for the vendors and allow you to edit payments and and mark them for NEC. There's still another patch expected anytime now which would be able to handle printing of 1099 forms for versions 11 and 12. and I looked right before this meeting to see if Sage had made an announcement of the 2020 1099 update and I haven't seen it yet so I'm still waiting for that for versions prior, like version nine. We'll have to create a 1099 printable form for those and then any versions prior.
We won't have the option of being able to select any C-form so most likely you'll have to modify the data outside of X3 so we're still discussing versions PU9 and less but most it would be specific to versions prior to PU9 that you can't change the data or print out the 1099 so we're still reviewing that for a resolution for people right now.
Danica: Then there's one other there's one other question: If you do the year-end simulation in X3, do you still need to run your SEI year-end simulation when running reports?
Doug: That's an excellent question, one which I'm happy to let Ed Halloran answer
Ed: Yes you do but I am double checking with with Scott Watts on this one
Doug: Okay, so we'll circle back on that
Leanne: I did have information on the SEI year-end simulation process it does have to be ran in the SEI as well
Doug: Thank you for confirming. Leanne is a wealth of knowledge in case you didn't know
One other thing to note on the 1099 processing in X3, electronic filing is not supported within X3 but there are several third-party apps that exist that allow you to take the data from a text file, excel, etc., upload it either through a website, or deliver it through FTP, or whatnot, to be able to perform that electronic filing.
Okay one of the other things that you'll want to ensure that you're checking after you've done your close is the date range after the new year begins, go ahead and make sure that you've verified that ENDDAT value in the default date parameters here underneath setup general parameters. It's the sixth row, the last row in my screenshot here, you want to make sure that that value is set at least a year in the future X3 looks at this date and prevents any transaction posting beyond that date so it's okay to set that date further ahead, more than one year ahead if you wish, in this case we've got a few years ahead just to ensure that that doesn't wind up being a stopping point for you for processing your transactions in X3
Danica: Thanks for joining us today and have a great holiday! Thank you Doug, thank you Ed, thank you Leanne
Doug: Thanks everyone