Multipub was built on a foundation that ensures it is always in balance and auditable. The platform leaves a complete audit trail, as every transaction is recorded. The system also provides details for making necessary business decisions.
That being said, it’s still critical for users to follow a series of accounting best practices to accomplish all that it was designed to do. There are five basic principles companies should keep top of mind, along with tips on how to carry them out.
- Setup is Key
- Garbage In / Garbage Out
- Checks and Balances Are a Must
- Fulfillment = Revenue
- Balance Daily, Weekly and Monthly
Setup is Key
Make sure that you have the proper options set and the codes defined to track all meaningful data. Items you may want to double-check:
- Accounting Periods
- Make sure that your valid accounting periods are defined to coincide with your organization’s fiscal calendar.
- Revenue on Payments?
- Determine whether you want to earn revenue on all orders regardless of whether or not payment was received or post everything to the deferred income account and only earn revenue for orders that have been paid.
- Cancellation Policies
- Determine if you want the system to automatically cancel orders at a certain point in their subscription. This cancellation transaction will zero out the account, so you don’t have to worry about carrying an old A/R balance indefinitely for customers. The system can also be programmed to write-off amounts that are within a defined tolerance.
- Payment Types
- Make sure there are separate payment types and general ledger (GL) accounts for items, such as: refund accounts, clearing accounts, non-cash accounts, foreign currency accounts and credit card accounts.
- Separate New and Renewal GL Accounts
- Create different GL accounts for new and renewal, earned and deferred income accounts, if you’d like to see earnings reported separately.
- Separate Bad Debt Account
- Create a separate bad debt account if you want to track the amount of income earned that must be backed out of the system when an order cancels without payment. Otherwise, write-offs will post cancellations by deducting from the income account.
- Discount Account
- Even if you don’t use discounts, Multipub recommends you create a separate account to track discounts. If they are used, you can use this account to track how much was given in discounts. If they are not used, you can use this account to track errors in data entry.
Garbage In / Garbage Out
The accounting in Multipub is only as good as the data going in. Make sure to establish policies for using the correct payment types for adjusting entries or cancellations and that you know when to reduce the sales amounts and terms correctly.
Checks and Balances Are a Must
It’s recommended that you separate the handling of money. Have one employee open the mail and prepare the deposit slip, while another enters the payments into Multipub. Also, the deposit report should balance with the deposit slip each day.
Fulfillment = Revenue
In Multipub, earning revenue is tied to the fulfillment of each product or order. When Multipub is asking for a ship date, it is asking for the date for which you would like to report income. Your standard operating procedures (SOP) should include a list of the ship date for each issue to eliminate possible reporting errors for your earnings. Similarly, the shipment of products and back issues also affects earnings, so make sure to use the correct revenue date when posting shipping records.
Balance Daily, Weekly and Monthly
It’s very important that balancing is completed every day, week and month without fail. This is how you will find errors in data entry, order processing, fulfillment, or simply timing. Below, you’ll find links to our accounting checklists for each.
Focus: Accounting Webinar Now Available
Don’t forget to sign up for the first installment of our webinar series, Focus, for a deep-dive into Multipub’s accounting capabilities. RSVP here for the February 24 event at 1:00 PM CST.