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Former Member
Jun 03, 2009 at 10:45 AM

Treasury : How to handle current portion for Longterm loan?

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Hi,

I having a problem with TR-Transaction manager module. Now we have long term loan, which is product type 55A and it will be posted to GL account as a long term. But the contract is like 10 years annual repayment. But for account standard, we have to reclassify the current portion, or the repayment amount which will be paid in the next coming year and present it as GL long term loan due in 1 year. ( or current portion of long term loan)

eg. principal 1,000,000 with annual repayment @100,000 for 10 years (create as 55A 200 = long term loan)

day1 post flow 1100 : principal increase

Dr. Cash 1,000,0000

Cr. long-term loan 1,000,000

repayment date : 1130 : installment repayment

Dr. long-term loan 100,000

Cr. Cash 100,000

end of year 1 (reclassify the year2 repayment to current port )

Dr. Long-term loan 100,000

Cr. current portion of long term loan 100,000

1 day of year 2 : reverse the current portion

Dr. Current portion of long term loan 100,000

Cr. long-term loan 100,000

??? Does TR-TM module can handle this kind of accounting adjustment??

Thanks a lot