Silverfin adoption - Year 1 procedures

As we move to a new accounts production platform, we will need to either import the comparative figures as a specific exercise and/or check that they agree to last years accounts. This brings into focus how we deal with opening balance or year end journals with our clients, some of which may post all, some or none of them and some may post them into the current year (esp if they use Sage).

For clients with a live sync into Silverfin, there is also the issue of the client back posting any entries into a previous period, after we have finished the accounts.

This issue is not new and in every relevant assignment we start by ensuring that the opening reserves agrees to last year’s accounts – however the advantages of syncs and automation in Silverfin does mean that if this type of exercise isn’t done, Silverfin will not balance.

The proposed solution depends upon the type of client and their software. 

Xero, QuickBooks and other clients with sync-able accounting software

Here we will be using a live sync with these clients so as to avoid the need for any manual imports or transfer of data.

  1. First step is where possible check journals have been processed properly in the client’s systems. This will make things much easier for the rest of this process.
  2. So we start by setting up the automatic sync - there are training guides for this in the FC help pages.
  3. This will pull in all data into Silverfin including prior periods. The next steps depend upon the client and our processes:
    1. If the client properly posts our year end journals into their system into the previous period, then we simply check those adjustments that we did not send them (such as split HP <1 >1 year or reanalysis of intercompany balances) and create journals for these.
    2. If the client posts these journals into the current year, but we have good records for that client with a full profit reconciliation and track of all internal and external journals for the prior year, then we use that to reconcile the TB in Silverfin to the accounts and confirm the journals needed.
    3. If we do not have good records for last year or the client is inconsistent in their posting of journals:
      1. If it is a small client, then we construct the journals manually by comparing the TB to the previous year accounts,
      2. If it is larger, then we should export the DAPA trial balance for that client for the previous year, compare the financials between the two TBs (Silverfin and DAPA/export). This should highlight any differences from which journals can be created – we are creating a tool which will automate the DAPA/DAP into Silverfin mapping here. 

It is worth bearing in the mind these opening balance adjustments should include adjustments to the profit & loss, as well as the balance sheet. If the original journal adjustment does not include adjustments to individual P&L account codes, these will need to be created and posted by us or the client. This can be carried out as mentioned above in step 3c. 

The journals created in the above would then be posted into the right period in Silverfin (i.e. the previous year to the current assignment). This is quick and painless in Silverfin and all the adjustments should be marked as reversing. This will then tie the prior year balances into the accounts. 

Note - we cannot simply import into Silverfin from DAPA for these clients as that would create one set of codes within the mapping of Silverfin that would not be used thereafter and would complicate the accounts process when we map the real Xero/QuickBooks codes
4. There are other tasks that can then be done in Silverfin in the previous year such as importing the Fixed Assets Register – this again is covered in the training course. If the client does have significant accruals, etc that have been created in the journals, it would be sensible to roll those templates forward as well.
5. There should then be a final check at completion of this year’s accounts that the prior year figures do match the final accounts for the previous period. If there is still a difference, this may be caused by clients back posting transaction that are not year end journals. We need to encourage clients to lock previous periods to prevent this happening, but in the meant time, we will need to trace these postings as appropriate for that software and create a further set of reversing journals.
6. Obviously in future, if we follow the Silverfin procedures and encourage our clients to lock their periods in their software (after posting the journals), this will be far less complicated and will take less time than currently as the adjustments are all held in one place and are easy to export, reverse and mark as posted.

Sage Desktop

This is slightly different as there is less opportunity for the client to post any year end journals into the previous period, so we generally provide these as balance sheet entries. We also do not have a live sync per se but sync data to a restored back up on our system.

Again first step is to see if we can work with clients to get journals processed, even if they are balance sheet only.

Then, again with good records or a good client, the initial comparison of Silverfin data for the previous period with the accounts/TB (derived from the auto sync set up) should be fairly easy and create the needed journals to post into Silverfin, again marking them as reversing into the previous period.  

For others, we can again follow the above process in deriving the journals in the most efficient manners and posting them into Silverfin, before rolling the file forward.

For situation where we cannot get a sync running, we should manually import the data, again as covered in the relevant part of the training guide and in this guide

Manual Records

This is slightly more straight forward as we will be using the Silverfin codes when we enter the data into Silverfin, so we can export the previous year’s TB from DAPA into Excel, recode it to Silverfin codes and then import it. This is covered fairly well in the case study and there is a guide in Silverfin here that is useful, but we do have a tool for mapping DAP / DAPA to Silverfin here.

There is a strange twist in Silverfin for manual records being rolled forward but this covered in the training. It relates to when you bring in your data for the next year by manual import, you need to remember to include a line at the bottom of the spreadsheet for the prior years profit/loss/retained earnings to clear off the retained earnings account - this is a frustrating Silverfin quirk that is being fixed.

Other software platforms

Until Silverfin gets a live sync to additional software , then this will require a tailored approach based on a combination of the above. We cannot use DAPA directly as we want Silverfin to learn the codes for that software.

As such, this is likely to be:

  1. Check journals for previous year have been entered where possible and that opening reserves agree to the prior years accounts.
  2. Extracting a nominal ledger report or trial balance from the software and map into Silverfin for the previous year.
  3. Create journals as needed to match prior year accounts and process these into Silverfin, marking them as reversing.
  4. Roll forward the file and again check reserves work.
  5. In completion for this year, run a check of the prior years figures into the previous year’s accounts.