NetClose - Creating an Amortization from Transactions

Overview

Amortization is the accounting process of allocating an expense/revenue to the periods that the economic value is realized.

Prerequisite

Before you create an amortization for the first time, you'll need to make sure your Amortization Types are set up in NetClose.

Step by Step

  1. Navigate to NetClose > Amortizations > Create from Transaction
  2. You can filter the Transactions by:
    1. Account
    2. Transaction Type
    3. Date
    4. Entity
    5. Posting Period
    6. Amortization Type
    7. Subsidiary
    8. Department
    9. Class
    10. Location
    11. Search
  3. Once you select a transaction that you will create an amortization from:
    1. Name the Amortization
    2. Choose a specified Amortization Type
    3. Set the term length of the Amortization. This field will autofill based on the amortization type, but can be changed.
    4. Update any accounts that are desired. These fields will autofill based on the amortization type but can be changed.
    5. If you select multiple transactions, you will have the option to create a single amortization or multiple amortizations. Creating a single amortization will combine all selected transactions into one amortization. Creating multiple transactions will create an amortization separately for each transaction selected.
    6. After clicking "Create", the amortization will populate on the "New Amortizations" tab.
    7. Select the name of the new amortization to pull up the amortization record on a new tab.
    8. Many fields will auto populate based on the transaction you are creating the amortization from, although all fields can be edited before commencing the amortization.
    9. To edit any information select "Edit"

Primary Information

FieldDescriptionExample
IDIdentification for the amortization. Autofilled in sequential order from last amortization.AMRT0240
NameName of amortization. Pulled from name given on amortization creation screen.Insurance Amortization
VendorVendor the amortization relates to. Autofilled from linked transaction.A Universal
CurrencyAmortization currency. Autofilled from linked transaction.USD
TypeAmortization type. Pulled from type selected on amortization creation screen. Insurance
StatusStatus of amortization. Autopopulates to pending upon creation. Pending
SubsidiarySubsidiary the amortization relates to. Autofilled from linked transaction.ACME U.S.A
DepartmentDepartment the amortization relates to. Autofilled from linked transaction.Administration
LocationLocation the amortization relates to. Autofilled from linked transaction.USA - Boston
ClassClass the amortization relates to. Autofilled from linked transaction.Class-A

Schedule Information

FieldDescriptionExample
Capitalization DateDate that the amortization will be capitalized. Autofilled from linked transaction.9/19/2024
Term (Months)Number of months to amortize over. Autopopulates based on amortization type.6
Start DateDate the system starts amortizing. Autofilled from linked transaction.9/19/2024
End DateDate the system ends amortizing. Autopopulated based on start date and term.2/28/2025
AmountAmount of the amortization. Autofilled from linked transaction.10,000.00
Remaining BalanceThe amount that will be amortized in the remaining periods. Populated after the amortization schedule is ran.8,000.00
Remaining PeriodsThe periods remaining to amortize over. Populated after the amortization schedule is ran. 5

Shared Transactions

FieldDescriptionExample
Income Statement Allocation TemplateShared Transactions Template to apply to the Income Statement accounts. Headcount Allocation
Balance Sheet Allocation TemplateShared Transactions Template to apply to the Balance Sheet accounts. 50/50 Allocation

10. Once all information has been verified, select "Save". 

11. The next step is to generate the schedule for the amortization. Follow the instructions in the Generating Amortization Schedules article to complete this process. 

Was this article helpful?