Symptoms
- Revenue from a recharge transaction is not appearing on the financials for the recharge operation, revenue appears under the wrong natural account, financial department or project code.
- Example: Income is not reflected on the GL Summary Report when the recharge's project code is used, but does appear under the default project code 0000000000 when the financial department code is used as the filtering parameter.
- Income is reflected in the incorrect natural account in the recharge's P&L under 522400 - Lab Supplies and Accessories instead of 410000 - External Sales and Services Revenues.
Cause
- Incorrect segment in chart string was used during processing.
Solution
Step 1: Identify the Fiscal Year
- Current Fiscal Year:
If the revenue error occurred in the current year and has not rolled up into beginning balance, you can correct it with a Journal Entry (JV). - Prior Fiscal Year:
If the revenue is from a closed fiscal year, you cannot reclassify it using a journal entry because prior-year balances are locked.
Step 2: Apply Corrective Action
- For Prior-Year Errors:
Submit a Fund Transfer Request to the Recharge Team to move the funds to the correct chart string. - For Current-Year Errors:
Submit a Journal Entry Request to the Accounting & Financial Reporting Team to reclassify the revenue to the correct chart string.
Step 3: Best Practices
- Do not attempt to adjust prior-year revenue with a journal entry—it will distort current-year financials.
- Attach supporting documentation (e.g., reports showing incorrect postings) and include correct target chart string when submitting requests.
Contents
- What should I do if revenue was posted to the wrong natural account in a prior fiscal year?
What steps should I take to resolve this issue?
Q1: What should I do if revenue was posted to the wrong natural account in a prior fiscal year?
A: Revenue posted to incorrect accounts in closed fiscal years (e.g., FY24, FY25) cannot be reclassified within those fiscal years. This is because natural accounts roll up into net position (3XXXXX – Beginning Balance) at the start of each new fiscal year. Once rolled up, prior-year revenue activity cannot be adjusted through journal entries without impacting the current year’s financial statements.
Q2: Why can’t we use a journal entry to fix prior-year revenue errors?
A: Journal entries affect the current fiscal year’s revenue. Using them to correct prior-year revenue would distort current-year financials and is not an appropriate accounting practice. Prior-year balances are locked once they roll into beginning balance.
Q3: What is the recommended approach for correcting prior-year revenue errors?
A: The best practice is to process a fund transfer using natural account 775103 – Fund Transfer Revenue and move the funds to the correct project code. This ensures proper allocation without altering historical financial statements.
Q4: Can current-year revenue errors be corrected?
A: Yes. If the revenue error occurred in the current fiscal year (e.g., FY26) and has not yet rolled up into beginning balance, you can submit a JV request to reclassify it to the correct natural account.
Q5: What chart-string elements should remain unchanged during correction?
A: All other chart-string elements (e.g., fund, department, project) should remain the same unless these need to be corrected for or otherwise specified.
Q6: What steps should I take to resolve this issue?
A:
- Submit a fund transfer request for prior-year amounts using natural account 775103.
- Submit a journal entry request for current-year amounts.
Attach supporting documentation (e.g., reports showing incorrect postings) when submitting requests.
Q7: Who can assist if I have questions about the process?
A: Contact your financial operations team or the Aggie Enterprise support team for guidance before submitting requests.
Q8: Who do I send the fund transfer request to?
A: Send fund transfer request to [email protected]. Assignment group: FOA FIN Recharge in ServiceNow.
Q9: Who do I send the JV request request to?
A: Send JV request to the Accounting & Financial Reporting Team for approval and processing. Assignment group: FOA Finance Accounting and Financial Reporting in ServiceNow.