NAV default dimensions and value postings on the chart of accounts (part 7 of 15)Posted: March 19, 2013
Value postings on the chart of accounts are your next line of defense to ensure a solid dimension strategy execution. You could probably be content by only applying value postings to your master data, but by adding value postings to your chart of accounts in addition to your master data, you are adding a layer of consistency and control into your transactional posting.
But what could go wrong, you might ask? How would the value postings on your master data fail you? If you are using code mandatory with a default value posting, what could possibly go wrong? Here’s what could go wrong – you could forget to populate the dimensions on a new master data item. Let’s say you set up a brand new item, or maybe a big group of items; how about a whole season’s worth of new items? You set them up and forget to populate the dimensions on them. You could go days, weeks, even months (hopefully not if you’re watching your financials) with these new items merrily populating your system with blank dimensions compared to all of your other items that are populating with default dimensions. Once you catch the error, you’ll need to track down all those blank pieces of data and do journal entry reclassifications to all the effected accounts, with all the effected dimensions, in order to fix your financial reporting.
[Sidebar: Easiest way to do this is to run an account schedule covering the effected accounts with the dimension filter set to ” (that’s two single quotes, the symbol for blank in NAV). You can then see every transaction that’s posted with a blank dimension, and use that to construct your correcting journal entries.]
If you’d like to avoid all of that pain, set up value postings on your chart of accounts. Here’s the trick: your should not use a default dimension value code together with your value postings. What you want to accomplish with this is to have your chart of accounts act as a control point for your postings. If your chart of accounts carry a code mandatory on the accounts, they are requiring that they receive dimension data from the master data card before they will allow any transaction to post to them. So, what happens when that rogue item with no dimensions tries to post through? The code mandatory setting on the general ledger account prevents it from posting, ensuring you never end up with any blank dimension postings in your transactions.
Keep reading this month as we continue our series, 15 Days of NAV Dimensions.