Why Do I Have a Year-End Difference for My Debtors/Creditors?

Year-end differences between the nominal ledger and backdated debtors/creditors list typically arise from timing discrepancies between the transaction date and the processing date in Navigator. These discrepancies can result in mismatches in the reports, particularly if they are not generated at the correct time.

Causes of Year-End Differences

1. Timing Issues:

   • Transactions may have been physically posted into Navigator after the period end but backdated to a prior period.
   • Backdated reports account for these entries, but they do not backdate 100%, causing variances.

2. Delayed Processing:

   • Transactions processed after the reporting period but dated within it can cause a mismatch between the report and nominal balances.

Best Practices to Minimise Differences

1. Run Reports on the Last Day of the Year:

   • To ensure the highest level of accuracy, generate reports directly from the system on the last day of the year.
   • This captures data as it stands at that point in time, avoiding backdated adjustments.

2. Use the Correct Reports:

   • Scheduled Nominal Report: Provides balances directly from the nominal ledger.
   • Backdated Debtors/Creditors Report: Shows transactions and balances as per the backdated entries.

Identifying and Resolving Differences

1. Compare Reports:

   • Run the Scheduled Nominal Report and the Backdated Debtors/Creditors Report for the same period.
   • Match balances to identify discrepancies.

2. Review Transactions:

   • Examine the accounts with differences to check the processing date and the transaction date.
   • Transactions with processing dates after the reporting period are the likely cause of the mismatch.

3. Communicate with Auditors:

   • Most auditors will understand these discrepancies if the processing dates are documented and audited appropriately.
   • Ensure you can demonstrate the timing of transactions and how they were accounted for.

Key Notes

• Backdated Reports: These are not fully retroactive and may not capture every detail from the nominal ledger.
• Timely Report Generation: Running reports on the exact year-end date minimises timing-related issues.
• Audit Trail: Maintaining a clear audit trail of processing dates vs transaction dates ensures compliance and transparency.