Revised: 05/5/2015
What do GL Allocations do?
This process will automatically distribute an amount to multiple GL accounts based on a percentage of the total amount. If certain transactions are distributed to many accounts every month, just setup an Allocated Account and let the system do most of the work instead of entering a long distribution list in AP Voucher Entry or GL Journal Entry.
When does the Allocation Process work?
The default in the Horizon Financial module is for the distribution to happen at the time it is posted into the General Ledger. So it will happen when a Journal Voucher is posted or when a Pull General Ledger Interface is run.
After allocations have been posted and distributed, changes to the percentages used may be needed. Use the Allocation Process to re-allocate the distributions after changing the percentages for the Allocation Model in the Allocation Master.
The Horizon Financial module has a setting to restrict the Allocation Process to run only when a user manually runs the Allocation Process from the menu. See instructions on how to use the Manual Allocation Process.
How GL Allocations Work: For the allocation process to work, an Allocation Model, Allocated Account and Receiving Accounts need to be setup.
Allocation Model: The model defines how each amount will be distributed by percentage and to which accounts. You may have multiple Effective Dates for an Allocation Model. When transactions are posted, the process will use the Effective Date appropriate for the transaction date.
Allocated Account: This is an intermediary account that will be entered in AP Voucher Entry, GL Journal Entry or any other program entry. This account should always have a balance of zero when the process is complete. All transactions posted to this account will be distributed back out based on the associated Allocation Model. This is the account that is setup in the GL Account Master as an Allocated Account.
Receiving Accounts: These are the general ledger accounts that will receive a portion of the total transaction during the Allocation Process. Do not mark these accounts in the GL Account Master as allocated.
Unallocated Account: This is a default general ledger account number that problem entries will be posted to. Select a GL account to serve as the unallocated account in Settings>>General Ledger Settings. If the allocation process tries to send a distribution to a general ledger account that does not exist, the amount will be posted to the default Unallocated Account instead.
What are Dynamic Allocations?
This is an extra step for more complicated general ledger setups. When this is turned on for a general ledger account, an additional "Allocation Model" field will open for entry during AP Voucher Entry and GL Journal Entry, when the account is selected. The program will default to the Allocation Model saved in the GL Account Master. The user may choose to change the default to a different model for this transaction.
**WARNING**
The Allocation Process under the Utilities menu does not work with Dynamic Allocations. Running this process manually will remove all distributions that were made using dynamic allocations and redistribute using the default model for each general ledger account.
Go to Maintain>>Allocation Master
Note: The Allocation Master program is also available from the GL Account Master>>Quick Links bar
Enter a new unique name for the Allocation Model,
Enter an Effective Date and Description for the model
Search and Replace
Use these check boxes to replace the checked account segments with other values so the same model can be used with multiple GL accounts. Check mark each segment that you wish to use the values from the allocated account rather than the value shown in the allocation model.
Such as: With segments FUND MAIN DEPARTMENT
You have allocated account 21-4410-99 with an allocation model set to 21-4410-01 75% and 21-4410-02 25%
By placing a check mark in MAIN, you may now set this model up on other accounts. If you put the model on account 21-5325-99, it will allocate to 21-5325-01 75% and 21-5325-02 25% because MAIN is check marked. You may check mark multiple segments.
In the Grid
On the 1st line, select an IFC Code if this account is to use Interfund payables.
Select or enter a general ledger Account Number
Enter the Units, Rate, Total and Percent for the Account Number
Units: Alternate budget method, normally left blank. Enter number of units to budget.
Rate: Alternate budget method, normally left blank. Enter the rate per unit.
Total: Alternate budget method, normally left blank. Calculates Total = Rate X Units
Percent: This is the most used method. Enter the percentage of total to go to this account. If using an Alternate budget method, leave blank.
As is: Check mark this box if the general ledger account should be used as entered and the segment replace should not be used for this account.
Tab to the next line, and continue this process until the Total Percentage at the bottom of the grid = 100%.
If using the Alternate budget method, enter all the budget lines. When done, click on the Recalculate Percentages button.
The Recalculate Percentages button is used with the alternate budget method to recalculate the percentages based on the budget
The Total Percentage shown at the bottom of the grid should always equal 100% when complete.
Save or Apply the information and then Close the view
To Review or Edit Allocations:
Go to Maintain>>Allocation Master
Note:
You should not change the percentages or general ledger accounts if your purpose is to create a new Effective Date for this model. See the procedure below for Creating a New Effective Date.
If you are changing the allocations for a period that has transactions already distributed, you may use the Allocation Process to redistribute the transactions with the new percentages.
In the GL Account Master, remove the check mark in Allow Dynamic Allocations.
In the grid, you may add, remove or change the general ledger account or change distribution percentages
Remember to make sure the Total Percentage at the bottom of the grid is equal to 100%
If the Total Percentage is incorrect, press the Recalculate Percentages button.
When done, press Save or Apply and Close the view
The purpose of the Effective Date is to allow different distributions for different date ranges. You may need to change the distribution yearly, monthly, or as needed. You may continue to post entries that will use the correct allocation percentages for the date it is posted into after creating a new allocation Effective Date for a later period. Any transactions posted to the General Ledger using allocations will compare the Transaction Date to the Effective Dates for the Allocation Model. I.E. Model "Admin" has 2 effective dates, 1/1/2010 and 1/1/2011. If transactions are posted with Transactions Dates of:
12/1/2009 - it is before any Effective Dates and will not allocate.
1/1/2010 - This is equal to the 1/1/2010 Effective Date, so it will allocate using the accounts and percentages setup for 1/1/2010.
5/20/2010 - This is after the 1/1/2010 and before the 1/1/2011 Effective Dates, so it will allocate using the accounts and percentages setup for 1/1/2010.
3/15/2011 - This is after the 1/1/2011 Effective Date and there are no Effective Dates with a later date, so it will allocate using the accounts and percentages setup for 1/1/2011.
6/30/2019 - This is after the 1/1/2011 Effective Date and there are no Effective Dates with a later date, so it will allocate using the accounts and percentages setup for 1/1/2011.
How to Create a New Effective Date:
Go to Maintain>>Allocation Master
Select the Allocation Model that is to have a new Effective Date
Select an Effective Date to copy
Click Duplicate button on the Quick Links bar to open the Allocation - Save As dialog box
Select the new Effective Date and make the necessary changes as per the instructions under To Review or Edit Allocations
Press Save or Apply and Close the view
Tying in to a General Ledger Account Number
Go to Maintain>>GL Account Master
Enter or select the account number that will be used to automatically distribute an amount to other accounts. If the account has not been set up yet, please follow the instructions in How to Add a New General Ledger Account
Check the "Allocated Account" box to place a check mark in it.
If this account requires Dynamic Allocations, then check the Allow Dynamic Allocations box
Select the appropriate "Allocation Model". If using Dynamic Allocations, this model will be the default.
Press Save or Apply then close the view
How the Unallocated Account Works
Horizon recommends setting up an account of all 9's such as 999-999-999. Do not use this account for any other purpose. Go to Settings>>General Ledger Settings - System Information and enter the account in the Unallocated Account field and save your change.
When an allocation is processing, it is possible that an account it should distribute to, based on the model, does not exist in your GL Account Master. These incorrect distributions will post to the Unallocated Account specified in General Ledger Settings (if the Unallocated Account field is left blank, these postings would go to a blank account). Check this account regularly for any activity. Activity to this account will mean a distribution did not work correctly. The General Ledger Transaction Register you preview or print after posting will show the transaction that posted to the 999-999-999 Unallocated Account. The memo will show two account numbers, such as "200411000/100411999". The first number (200411000) will be the account that the allocation model attempted to send the amount to and the second number (100411999) will be the account that the amount was distributed or allocated from. Correct the model in the Allocation Master or add the missing general ledger account number in the GL Account Master. The amounts may then be transferred to the correct account with a journal entry.
Setup for Manual Allocations only:
Go to Settings>>General Ledger Settings
Select the System Information tab
Place a checkmark in the Use Manual Allocation Process box
When this option is turned on, activity does not allocate automatically when posted, the Allocation Process must be run manually from the Utilities menu. See How to Allocate Manually,
Horizon recommendations for running the Allocation Process utility:
Run the process for one month date ranges. This will distribute the activity on the End Date entered for each month.
If new transactions are posted to a period that has already been distributed, the Allocation Process must be run again for the period.
Always be consistent with the date ranges entered. Run for one month periods so if a month needs to be re-run at a later time, users will know the correct range to use.
Run general ledger reports to verify that all Allocated accounts have ending balances of zero.
Go to Utilities>>Allocation Process
This process will allocate or re-allocate amounts to general ledger accounts based on information in the Allocation Master and the GL Account Master.
This process must be used to distribute allocations if the Use Manual Allocation Process box is checked in General Ledger Settings.
Use this process to:
Allocate account activity when set to "Use Manual Allocation Process"
Re-allocate after making changes to a model. This will correct distributions after adding a new Effective Date for a model or changing general ledger accounts or percentages.
Remove the distribution from an account that should no longer be allocated by making the following changes in the GL Account Master before running the process:
Go to Maintain>>GL Account Master
Select the allocated general ledger account number
Delete the code from the Allocation Model field
Uncheck Allocated Account
Uncheck Allow Dynamic Allocations
Press Save or Apply before closing or clearing the view
Remove all allocation distributions between the Start and End Dates entered
Distribute the total activity for the period. Distribution for each Allocated Account will be based on the current default Allocation Model assigned in the GL Account Master.
All distributions will have a Transaction Date of the End Date selected for the process.
Horizon recommends running this process for one month date ranges. This will distribute the activity on the End Date for each month.
**WARNINGS**
The manual Allocation Process, run from the Utilities menu, does not work with Dynamic Allocations. Running this process will remove all amounts distributed dynamically and redistribute using the default Allocation Model assigned to allocated general ledger accounts.
Do not enter a Date range that crosses over an Effective Date in the Allocation Master. The process will distribute all activity using the model's Effective Date instead of the End Date entered.
If the Allocation Process is run for a multiple month range (1/1/2011 to 2/28/2011) and then is later run for a portion of this date range (1/1/2011 to 1/31/2011) the January activity in this example will have been allocated twice. The February allocated accounts in this example will not have a zero balance on 2/28/2011. (Fix this issue by running the process for each month separately. Process with date of 1/1/2011 to 1/31/2011 for January and then process with dates of 2/1/2011 to 2/28/2011 for February)
When Use Manual Allocation Process is checked in General Ledger Settings:
If new transactions are posted to a period that has already been distributed, the Allocation Process must be run again for the period.
Always be consistent with the date ranges entered. Run for one month periods so if a month needs re-run later, users will know the correct range to use.
Run general ledger reports to verify that all Allocated Accounts have ending balances of zero.
Date Selections
Start Date
Enter or select a beginning date for the processing of allocated transactions.
End Date
Enter or select an ending date for the processing of allocated transactions.
Process
Click the Process button to allocate or re-allocate information for the date range entered.