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Deferrals - Deferred Expense

Used when the expense for goods or services has been paid for in advance (i.e., in the current fiscal year) and the activity won't take place until the following fiscal year. This is required for items of $10,000 or more, optional for items $1,000 or more, and should not be done for items under $1,000.

Examples:

• Registration fees posted to the ledger in one fiscal year for a conference that will take place in the following fiscal year.
• Catering services for an event in July of next fiscal year required advance payment this June.
• Books or software ordered using the Purchasing Card in June are not received until July.

To record deferred expense using the AV or YEAV:

1. CREDIT the same Full Accounting Unit (FAU) used when the expense was paid.
2. Offset (DEBIT):

   Account	Account Description	Object	Object Code Description	DR/CR
   1143000	Deferred Expense	0801	Deferred Expense	Debit

Remember:

• The invoice was posted to one fiscal year for goods/services that were not received until the following fiscal year.
• Enter a reversal date in the YEAV document (greater or equal to 7/20/200X).
• Must include the date the goods/services were received, vendor name, purchase order number or invoice number. Include the date of the intended activity in the explanation field.
• You do not need more than one line for the Deferral account.
• The reversal of the YEAV will result in a debit to expense, appropriately moving recognition of the expense to the correct fiscal year.

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