Si, others, If I cannot convince you that an "Uninvoiced Fixed Asset Receipt" (UFAR) account is flat wrong, perhaps I can at least sway your opinion that the approach is not desirable; or that it causes more problems than it solves.
First, I'm going by the assumption that UFAR is a sub-account to Accounts Payable (AP). If my assumption is incorrect, you are understating your liabilities. 1) So, if UFAR is a sub-account of AP, then the journal entry: Dr: UFAR - $1,000,000 Cr: AP - $1,000,000 is redundant. This redundancy causes a problem in the event of an audit (internal or external). The transaction that debits UFAR has evidence by way of invoice. However, the transaction that credited UFAR has no evidence to support the transaction occurring (as this usage is unorthodox to say the least, the invoice may actually instead be evidence of the transaction that credited UFAR, or may not be sufficient as evidence of either transaction. But certainly, the invoice is cannot be evidence for both). This lack of evidence provides ample opportunity for someone to defraud a company. 2) Being two seperate transactions that deal with monetary numbers, how do you reconcile the following scenario? Purchase a fixed asset for what you believed to be $1,000,000 Dr: Fixed Assets - $1,000,000 Cr: UFAR - $1,000,000 Invoice shows up with the cost of the asset being $950,000. Dr: UFAR - $950,000 Cr: AP - $950,000 UFAR has a remaining balance of $50,000 The correct journal entry for a misunderstanding of price is: Dr: AP - $50,000 Cr: Fixed Asset - $50,000 The sanest possible journal entry in a UFAR world would instead be: Dr: UFAR - $1,000,000 Cr: Fixed Asset - $ 50,000 Cr: AP - $ 950,000 If all you're ever going to do is debit UFAR the same amount that you previously credited it, there is no point in maintaining it; it provides no additional information to decision makers above and beyond providing a status Id to the projected invoice. Which, can be accomplished much easier by simply providing a status id to the projected invoice.
