General Ledger Technical Documentation

This document provides a technical overview of the General Ledger (GL) functionality within the Flex system, focusing on its interfacing mechanisms, daily balancing procedures, and available reporting tools.

1. General Ledger Fundamentals

The General Ledger is the core of the Flex accounting system, recording all financial transactions. Understanding how different transaction types affect the GL is crucial for maintaining accurate financial records.

1.1. Account Types and Balances

The Flex GL categorizes accounts into the following types, each with a specific normal balance:

  • Income (Account Code 110)
    • Normal Balance: Credit
    • Debit (−
      ): Decreases Balance
    • Credit ($$+$): Increases Balance
    • Examples: Interest on Loans, Investment Income, Fees and Charges
  • Expense (Account Code 210)
    • Normal Balance: Debit
    • Debit ($$+$): Increases Balance
    • Credit (−
      ): Decreases Balance
    • Examples: Salaries, Benefits, Utilities, Station and Supplies, Insurance, Interest on Borrowed Money, Dividends
  • Asset (Account Code 700)
    • Normal Balance: Debit
    • Debit ($$+$): Increases Balance
    • Credit (−
      ): Decreases Balance
    • Examples: Loans to Members, Cash, Investments, Prepaid Insurance, Land, Buildings, Furniture and Equipment, Accrued Interest on Loans
  • Liability (Account Code 800)
    • Normal Balance: Credit
    • Normal Balance: Credit
    • Debit (−
      ): Decreases Balance
    • Credit ($$+$): Increases Balance
    • Examples: Accounts Payable, Notes Payable, Accrued Interest Payable, Dividends Payable, Salaries Payable
  • Equity/Capital (Account Code 900)
    • Normal Balance: Credit
    • Debit (−
      ): Decreases Balance
    • Credit ($$+$): Increases Balance
    • Examples: Regular Shares, Share Drafts, Regular Reserves, Undivided Earnings

2. General Ledger Interfacing

Transactions from various Flex modules interface with the General Ledger. The timing and method of these interfaces depend on the transaction type.

2.1. GL Menu Postings

  • Transaction Types: Journal entries and recurring journal entries.
  • Interface Timing: Immediate.
  • Reporting: Appear as separate line items on the GL Transaction Listing and in the GL history.

2.2. Teller Transactions

  • Transaction Types: Includes system tellers (e.g., AC, SD, TR, etc.) and manual transaction entry.
  • Interface Timing: During the End of Day (EOD) process.
  • Automatic Offsets:
    • Deposits (Debit): Automatically debit the Change Fund GL.
    • Cash Withdrawals (Credit): Automatically credit the Change Fund GL.
    • Offset Accounts: Offset to capital (for shares) or assets (for loans) accounts.
    • Check Withdrawals: Automatically offset the Cash in Bank GL.
  • GL Account Configuration:
    • Change Fund GL and Cash in Bank GL numbers are defined in:
      • Miscellaneous Information configuration.
      • Branch Maintenance configuration (under the Configuration sub-menu).
  • Reporting:
    • Posted as batch totals for the day on the GL Transactions Batch Edit List Report (GL1000), included in EOD reports.
    • Some transactions (OP codes, GL checks via GL Check Disbursement, loan checks, releasing checks) appear as separate line items on GL1000.
    • Configurable in General Ledger Company Maintenance whether teller checks appear as line items or batch totals.
  • Batch Reporting:
    • The “Tran List by Batch” option on the GL Reports menu can generate batch reports for previous days.
    • Flex automatically assigns batch numbers in the format CU MMDD.
    • For branch accounting, the branch code is inserted between CU and the date (e.g., CUBRMMDD).
    • Flex-assigned batch IDs are always 8 characters long.

3. Daily General Ledger Balancing

Balancing the General Ledger daily is critical. The Flex system provides several tools and reports to assist with this process.

3.1. GL Trial Balance

  • Generation: Automatically generated by the EOD procedure.
  • Verification: Must be reviewed daily to ensure it is in balance (all zeros at the bottom of the report).
  • Troubleshooting Out-of-Balance:
    • If out of balance, identify the last day the report was in balance and begin investigation from the first day it went out.
    • Reports to Check:
      • GL Interface Error Report (EOD Report): Identifies interface errors (e.g., invalid GL account numbers in control files or OP Codes).
      • Teller Transaction Report (EOD Report):
        • Check net totals for each teller; if non-zero, identify the out-of-balance teller.
        • ??????? in line items indicates an incorrect or invalid GL.
        • * next to a line item indicates a reversed transaction.
      • GL Transaction List (EOD Report): Check interface batch totals for discrepancies.
      • Share, Loan Certificate Comparison (EOD Report): Shows calculated differences in shares, loans, or certificates.

3.2. GL Analysis Report (MS512)

  • Generation: EOD report, prints immediately after the GL Trial Balance.
  • Purpose: Compares system-calculated GL balances for shares, loans, and certificates against actual GL balances.
  • Verification: The “difference” column should always display zeros. Any non-zero difference requires immediate research.
  • Common Causes for Out-of-Balance:
    • Type Code Changes: Changing a type code in a member record (Share, Loan, or Certificate maintenance) can cause an imbalance if the new type code’s automatic GL offset differs from the original.
      • Resolution: A manual journal entry for the account balance may be necessary.
      • Verification: Check GL offsets for all types via the Type Configuration menu or run “GL Accounts by Type” from the GL Reports menu.
    • Non-Automatic Dividend Interface: If dividends are not automatically interfaced, the report will be out of balance by the amount of dividends paid after End of Month (EOM) until a manual entry is made.

3.3. ACH, ATM/Debit Card, and Draft Clearing Accounts

  • Recommendation: Keep Flex postings for these GL clearing accounts until balanced.
  • Balancing Frequency: These accounts should be balanced daily.

3.4. Paper Payroll

  • Account: Undistributed payroll general ledger account.
  • Verification: Check daily to ensure all payrolls posted correctly.
  • Normal Balance: Should normally have a zero balance.
  • Troubleshooting Non-Zero Balance:
    • Verify all payrolls posted.
    • Verify all checks were deposited or transfers posted.
    • Check for payroll transactions attempting to post to a closed account.

3.5. Teller Change Fund

  • Balancing Frequency: Should be balanced daily.
  • Verification: The Change Fund GL balance should equal the total cash in the credit union as represented by the Summary Teller totals (BE5300-BALANCESUM) balancing report.
  • Procedure: Check the ending balance of the previous business day against the Summary Teller totals.
  • Alternative Verification: Check the GL balance against the Teller Balancing screen for ALL tellers or use the Teller Balancing Report (Teller Reports menu).
  • Beginning Balance: The beginning balance for ALL tellers should match the ending balance for all tellers from the previous day.
  • Troubleshooting Out-of-Balance:
    • Unreleased Checks:
      • If tellers did not release their checks and auto-release is not enabled, a journal entry is needed (credit change fund GL, debit cash in bank GL or check deposit GL).
      • Note: Checks cannot be released from a previous day.
      • Auto-Release Configuration:
        • General Configuration Features: Page 1, set Enable Auto Release @ EOD flag to Y.
        • General Configuration Miscellaneous Information: Page 1, define default Release Checks GL account.
        • General Configuration Branch Maintenance: Define default Release Checks GL account for each branch (for multiple branches/branch accounting).
    • Incorrect Release Amount: A journal entry is needed between the change fund and cash in bank accounts.
    • Teller Drawer Discrepancy: Check all teller actual drawer balances against EOD teller balancing reports.
    • Manual Journal Entry Errors: Check the change fund GL history and verify manual journal entries were made correctly using the “Transaction Listing-By Account” report.
    • Cash Received/Sold: Verify proper transactions were posted for changes to cash.
  • Outage Adjustment:
    • If a teller is out of balance for the day, adjust through the over/short account using “Adjust System Up/Down for Teller Overage/Shortage” before the teller closes their drawer.
    • If found later, correct by posting a transaction between the over/short GL account and the member’s account.
  • Key GL Accounts Affected:
    • Change Fund GL: Affected by all checks in, cash in, cash back, and cash out transactions.
    • Cash in Bank GL: Affected by all checks out.
    • Definition: Both are defined in General Configuration Miscellaneous Information (page 1) or General Ledger Branch Maintenance.
  • Summary Teller Totals (BE5300-BALANCSESUM) Calculation:
    • Checks In + Cash In – Cash Back = Interface Debit
    • Cash Out = Interface Credit

3.6. Money Orders/Traveler Checks/Tickets/VISA Payments by Tellers

  • Balancing: Tellers can balance these items daily using an OP Code.
  • Method: Can be balanced individually by teller or for all tellers at each branch.
  • Tool: Use the “GL Account Balancing” tab in Teller Balancing to obtain totals.

4. Balancing Tools and Reports

The Flex system provides a suite of reports and tools to aid in GL balancing and reconciliation.

4.1. End of Day Reports

  • Teller Transaction Detail (BE5020P-TELLERTRNS)
  • Teller Balancing Summary Report (BE5300P-BALANCESUM)
  • Share, Loan, Certificate Comparison (MS5130P-SHLNCERTCP)
  • GL Transaction Listing Report (GL1000-GLTRANLIST)
  • GL Interface Report (GL3000P-GLINTERFAC)
  • GL Trial Balance Report (GL1600P-GLTRIALBLD)
  • GL Analysis Report (MS512)
  • HDAY-BALA Comparison Report

4.2. General Ledger Menu Options

  • General Ledger History: Provides a historical view of GL transactions.
  • General Ledger Reports:
    • GL Tran Listing by Account
    • GL Tran Listing by Batch
    • List of GL Accounts by Type

4.3. Teller Balancing and Reports

  • Teller Balancing:
    • Print Checks: Prints a list of all checks received for selected teller(s).
    • GL Account Balancing tab: Used for balancing money orders, traveler checks, etc.
  • Teller Reports:
    • Teller Balancing Report: Can be selected for individual tellers or “All Tellers.”

4.4. Document Manager

  • Functionality: Allows filtering for specific report(s) and date(s).