Unallocated Revenue COA

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Explains general information regarding the 'Unallocated Revenue' Chart of Account line item on the Budget Variance Report.

What is the Unallocated Revenue Account?

The Unallocated Revenue Account is a Billhighway system account used for any client on the Cash Basis Method of Accounting.  The main concept of the Cash Basis Method of Accounting is to recognize revenue and expenses when physical cash comes in or goes out.

Why is the Unallocated Revenue Account Used?

When a member submits an overpayment on his or her account, the Billhighway system doesn’t yet know which revenue account to increase, since the payment is not yet applied to an invoice.  Therefore, the Billhighway system is designed to increase the Unallocated Revenue Account when a member overpayment is established in Billhighway.

Once the member overpayment becomes applied to an invoice, the Unallocated Revenue Account will automatically decrease and the revenue account attached to the invoice will increase.

:  This “payment allocation activity” can, and often does, cross fiscal years.  Since the Unallocated Revenue Account balance does not carry over between fiscal years, it can result in a negative balance in the current fiscal year.  For example, a member submits an overpayment of $100.00 at the end of the 2013 fiscal year.  The Unallocated Revenue Account will reflect a positive $100.00 balance in the 2013 fiscal year.  In the 2014 fiscal year, the overpayment becomes applied, which results in a negative balance of ($100.00) in the 2014 fiscal year.

What to do with the Unallocated Revenue Account?

No action is necessary or should be taken.