Grain Month End Procedures
Make sure all daily Grain transactions have been entered. Steps 1 - 3 should be done in the LIVE data set and Steps 4 – 13 are to be done in the month end COPIED DATASET, EXCEPT for the journal entries. The journal entries need to be made in the LIVE dataset. All journal entries are reversing journal entries (except number 13). The steps need to be done in the following order.
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7.) Open Contracts Gain/Loss (Hedge contracts not included) – Assumes that hedge
entries for closing of open hedges are being made from the hedge statement
received from the broker. There are multiple steps needed here to determine the
gain/loss on open contracts.
Delete In the COPIED DATASET delete Old Situations – Under Commodity Tables – Market Prices, choose
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8.) Open Contracts Gain/Loss (Hedge contracts are included) – Assumes that hedge
transaction detail (i.e. Price, future price and future month) are entered as
Hedge/Future type contracts. Cancellations are being done when hedge
transactions are being executed. Market Valuation formula for Hedge/Future
Type contract has been defined based upon the future month. There are multiple
steps needed here to determine the gain/loss on open contracts.
Delete In the COPIED DATASET delete Old Situations – Under Commodity Tables – Market Prices, choose Option 4 – Delete Futures/Basis Information. Enter a futures month with a date out in the future. If you enter 1209, the system will delete all situations prior to December 2009. Use delete Option 3 - Both Futures Price And Market Basis.
Create Market Situations – Run the standard Contract Report Market Situation Report but adjust parameters. Change the ending priority level from 12 to 14. A user defined report can be made so it can be ran at Month End without adjusting parameters. This report will create market situations for all of your active contracts which will include the Hedge/Future type contracts.
Enter Futures Price – Under Commodity Tables – Market Prices, choose Option 1 - View/Edit Futures Price. You will need to go through this for every commodity. You will see a "situation" for every board/futures month combo that you have on active contracts. Select each one and enter the closing price for that "situation" at month end.
Enter Market Basis – Under Commodity Tables – Market Prices, choose Option 2 - View/Edit Market Basis. You will need to go through this for every commodity. You will see a "situation" for every grouping of contracts. You need to enter the market basis for each of those situations
Gain/Loss on Open Contracts – Run the standard Contract Report Market "To Arrive" Report. This will calculate the gain/loss on each contract. You will book an entry for the total gain or loss for each commodity.
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9.) Gain/Loss on Open Hedges - Run In the COPIED DATASET run the standard Contract Report Market "To Arrive" Report but adjust parameters. Change parameters for priority level to 14 for beginning and 14 for ending. This will give you only the Hedge/Future type contracts. A user defined report can be made so it can be ran at Month End without adjusting parameters. This will calculate the gain/loss on each contract. You will book an entry for the total gain or loss for each commodity. This figure should match your broker statement.
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10.) Unpaid Delivery Sheet Report – To accrue for Purchase Payables and Sales
Receivables print the standard delivery sheet report Unpaid Delivery Sheets
Report in the COPIED DATASET but adjust parameters. Change print Delivery Sheet Detail to a N. Change
Print Deduction Detail for Totals to a Y. Change Use Current Market Price For
Unpriced Sheets to a Y. For Deduction Status enter a U for Beginning and a U for
Ending. A user defined report can be made so it can be ran at Month End
without adjusting parameters. Use the total remaining amount and add back
any deduction item that is not going to the grain account in Ledger (i.e.
storage/dp charges, grain assessments, and advance deductions).
An accrual will be necessary for storage/dp charges and/or other discounts such
as drying.
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11.) Tickets Not On Delivery Sheet Report – Run this report in the COPIED DATASET to verify that there are no tickets not on a delivery sheet. If there are tickets on this report then you will need to analysis the totals to determine if any entries need to be made to recognize any receivables or payables.
12.) Accrue Storage - Use the storage charges report to book an additional storage accrual. Under the Storage Charges menu, choose the option for Choose Commodity/Customer. Blank out location, commodity, & customer. Calculate charges through end of month. Use Option 1 - Do Not Update Charges. Make sure there is nothing in the Previous Invoiced Not-Paid column on the report. If there is an amount here, research what it is. A manual journal entry may be necessary to account for this.
Example of report:
DATE: 05/14/14 AG SUPPLY COOPERATIVE - Grain Month End
| Anchor | ||||
|---|---|---|---|---|
|
TIME: 8:46 pm STORAGE/D.P. CHARGES REPORT
STORAGE/D.P. CHARGES CALCULATED THRU 05/14/14
COMMODITY/LOCATION CN-100 Yellow Corn >>>>>> TOTAL DUE <<<<<<
UNEARNED DATE PREVIOUS NEW
---DELIVERY SHEET---- REFERENCE AVG-TCKT NET TOTAL TOTAL (PREPAID) PAID INVOICED INVOICE
NUMBER TYPE DATE NUMBER DATE TBL Bushels CHARGES PAID BALANCE UP TO NOT-PAID AMOUNT
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
000003-01 os 05/14/14 03/20/14 1 2775.00 151.52 .00 .00 00 151.52
JAMEJESS James, Jesse SC 2775.00 $151.52 $.00 $.00 $.00 $151.52
TOTAL DUE: $151.52
CN-100 Yellow Corn SC 2775.00 $151.52 $.00 $.00 $.00 $151.52
GRAND TOTALS SC 2775.00 $151.52 $.00 $.00 $.00 $151.52
Use the New Invoice Amount to make the following entry:
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12.) Freight Accrual – Choose the Freight Expenses option from the commodity menu. This report does not give a subtotal by commodity. Run a report for each commodity that freight may be involved with. Choose Option 2 - Print Report Without Marking The Tickets. A ticket report can also be designed to get this same information. It can be made to sort by commodity so only one report needs to be ran.
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