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Set up roll forward and income allocation accounts

At the beginning of each period, Client Accounting clears the previous period's income and expense balances to zero. It's like a bit of spring cleaning so your ledger's ready for the new period.

But you may have balance sheet or inventory accounts with closing balances that you need to transfer to the opening balance account for the new period. For example, transferring the balance of your closing stock account to the new period's opening stock account. Or the beneficiary funds to the new period's opening balance accounts.

Setting up balance forward accounts

If you...The codes...

Migrated a MAS, Accounts or AO Classic general ledger

The codes were brought across when you migrated to MYOB Ledger. This step's done!

Created a new ledger using a standard MYOB chart of accounts

Balance forward account codes have been pre-configured based on the entity and chart style used. This step's done!

Haven't used an MYOB standard chart of accounts

You may need to define your balance forward accounts before you begin the period. For full details, see Defining Balance Forward Accounts in our Online Help.

Setting up income allocation and profit distribution

Before you set up the income allocation accounts, have a think about how you plan to distribute profit and loss for your client:

If your client is a...We recommend...

Trust

Partnership (fixed $ amount of profit distributed)

Fund

Do a manual journal at the end of the period to distribute profit to each beneficiary. Automatic distribution only works for percentages of profit distributions, not fixed amounts.

 If you're using a standard MYOB chart of accounts, on rollover to the next financial period, a reversal journal is automatically created at the beginning of the period.

Partnership (percentage of profit distributed)

Individual

If you'll be distributing a percentage of profit or loss at the end of the period, you can use the income allocation function to automate the profit distribution at the end of each period.

A percentage of profit or loss will automatically be allocated to each partner's Current Year Earnings account at the end of the period.

Company

Association

By default, MYOB Ledger will distribute 100% of profit or loss to your Current Year Earnings system account and, on rollover, will balance forward to your ledger's Retained Earnings system account. However, you may want to review the income allocation to ensure the correct account codes are being used.

To set up profit distribution or income allocation in MYOB ledger, click your entity type below for more information.

Trust, partnerships and funds (manual distribution)

If your client is a trust or fund entity, or you want to distribute a fixed dollar amount to a partner, distribute profits by posting a journal using the default ledger setup.

To post a manual journal to distribute profit or loss

  1. On the TASKS bar, click Launch AE/AO Ledger. Your client's MYOB ledger opens in a web browser.
  2. In the MYOB Ledger website, click Settings and select Income Allocation.
  3. Click the drop-down next to the current Allocation Period, ensure the Equity column is 100%, and click Save.
  4. In the Income Allocation screen, Click Manager Owners.

  5. Click the drop-down for Owner and ensure the data in each field reflects the following:

    Partner One (or sole owner)
    Chart of AccountsRetained EarningsCurrent Year Earnings
    MAS5000050002
    AO Classic GL500/00500/02
    AE Accounts1.585***1.590

  6. Click Save to save and apply the changes.
  7. Once all owners have been added, click the Income Allocation button to return to the Income Allocation window. You can then specify a percentage of profits to allocate to each partner at the end of each financial period. See Set up roll forward and income allocation accounts#To allocate a percentage of profit to each partner in Partnerships and individuals.
Partnerships and Individuals (automatic distribution)

If you're allocating a fixed dollar amount of profit or loss to a partner, or if you're setting up a trust entity, do the profit distribution via a manual journal. Refer to Trusts and Partnerships (manual distribution) above for details.

To set up MYOB Ledger to distribute a percentage of profit or loss to each partner, use the Income Allocation function in MYOB Ledger to automatically distribute in each period.

To add or edit partner details

  1. On the TASKS bar, click Launch AE/AO Ledger. Your client's MYOB Ledger opens in a web browser.
  2. In the MYOB Ledger website, click Settings and select Income Allocation.
  3. Click Manager Owners.

  4. Click on the drop-down for Owner and edit the data in each field to reflect each partner's or individual's equity accounts. You can also change the Owner name to reflect the name of the partner.


    		Partner One (or sole owner)Partner Two Partner X (i.e. Partner Three and onwards)
    Chart of AccountsRetained EarningsCurrent Year EarningsRetained EarningsCurrent Year EarningsRetained EarningsCurrent Year Earnings
    MAS5010050102502005020250X0050X02
    AO Classic GL501/00501/02502/00502/0250X/00

    50X/02

    AE Accounts1.5851.5902.5852.590X.585X.590

  5. Click Save to save and apply the changes for the partner.
  6. If you need to add another owner, click Add Owner and repeat step 4.
  7. Once all owners are added, click Income Allocation to return to the Income Allocation window. You can then specify a percentage of profits to allocate to each partner at the end of each financial period. See Set up roll forward and income allocation accounts#To allocate a percentage of profit to each partner.

To allocate a percentage of profit to each partner

Here you'll define a percentage of profits to distribute to each partner. If you have more than one partner, make sure you've added the additional partner as an owner first.

  1. In the Income Allocation window, click the drop-down next to the current Allocation Period.

  2. Click on the Owner drop-down and select the first partner.
  3. Enter a percentage of profits to allocate to the partner in the Equity column.

  4. To distribute a percentage of profits to an additional partner, for every additional partner, click Add another owner and repeat step 2 to select the partner and enter a percentage of profits to allocate.


    The percentage total must be 100%.


  5. Once all partners have been added, click Save. You can then close the web browser.
Companies and Associations (automatic distribution)
By default, MYOB Ledger distributes 100% of profit or loss to your Current Year Earnings system account and, on rollover, balances forward to your ledger's Retained Earnings system account.
If you're using a non-standard MYOB chart of accounts or you haven't specified your system accounts when migrating (e.g. if you've created a new ledger), you may want to check which account your profit or loss will be allocated.
To check which account your profit or loss will be allocated
  1. On the TASKS bar, click Launch AE/AO Ledger. Your client's MYOB ledger opens in a web browser.
  2. In the MYOB ledger website, click Settings and select Income Allocation.
  3. Click the drop-down next to the current Allocation Period, ensure the Equity column is 100%, and click Save.
  4. In the Income Allocation window, click Manager Owners.

  5. Click on the drop-down for Owner and ensure the data in each field reflects the following:


    		Partner One (or sole owner)
    Chart of AccountsRetained EarningsCurrent Year Earnings
    MAS638639
    AO Classic GL638639
    AE Accounts5281000



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