Allocate amounts

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Allocations are used to distribute the amount on the recurring journal line to several G/L accounts and dimensions. In other words, the allocation is a balancing account line to the recurring journal line because recurring entries do not have balancing accounts.

Screenshot of the Recurring journal allocations page.

As in a recurring journal, an allocation must be entered only once. The allocation remains in the allocation journal after posting. Therefore, you do not have to reenter amounts and allocations every time that the recurring journal line is posted.

If the recurring method in the recurring journal is set to Balance or Reversing Balance, then any dimension value codes in the recurring journal are disregarded when the account is set to zero. Accordingly, if you allocate a recurring line to various dimension values on the Allocations page, then only one reversing entry will be created. Therefore, if you allocate a recurring journal line that contains a dimension value code, then you cannot enter the same code on the Allocations page. If you do enter the same code, the dimension values will be incorrect.

To allocate recurring journal amounts based on dimensions, set the Recurring Method field to Balance by Dimension or Reversing Balance by Dimension instead. This is useful when you only want to allocate the balance of a specific dimension value, and not the total balance of a G/L account.

If the recurring method in the recurring journal is set to Balance by Dimension or Reversing Balance by Dimension, then any dimension value codes in the recurring journal are considered when the account is set to zero. This means that if you allocate a recurring line to various dimension values on the Allocations page, then several reversing entries that matches the number of dimension value combinations that the balance is comprised of, are created. If you allocate account balance through the recurring journal that contains a dimension value code, remember to use Balance by Dimension or Reversing Balance by Dimension to make sure that the dimension values are correctly balanced or reversed from the source account.

For example, your company has a couple of business units and a handful of departments that your controllers have set up as dimensions. To speed up the purchase invoice entry process, you decide to require the accounts payable clerks to enter only business unit dimensions. Since each business unit has specific allocation keys for the Department dimension, such as based on the number of employees, you can use the BD Balance by Dimension or RBD Reversing Balance by Dimension recurring methods to re-allocate expenses for each business unit to the right departments based on the allocation keys.