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When to use a future account

For situations where you might be forecasting a business event or change, but there are no Chart of Accounts line items to account for it, Fathom allows you to create future accounts.

Creating a future account enables you to add values against a new account that does not exist in your source accounting system and only exists within Fathom.

Some of the key use cases for Future Accounts include:

  • Loans

  • Asset purchases

  • Payroll

  • New products/service lines

Once you have created an actuals account in your source accounting system, you are able to merge the future account with your actuals account.


Creating a future account

You are able to create a future account within a microforecast. To do this:

  1. Open or create a microforecast by accessing the Microforecast Manager with the ‘Microscope’ icon on the left-side navigation bar

  2. If you are using one of the microforecast wizards,

    1. Any time you need to choose an account from your Chart of Accounts, you are able to type in ‘account doesn’t exist yet’ and choose that option to create a future account

    2. Name the future account

    3. Choose an account classification for the future account

    4. The account will be added to your microforecast once you complete the wizard

  3. If you are creating a microforecast from scratch or if you have already completed one of the microforecast wizards,

    1. Select ‘Add account

    2. From the drop down menu, scroll to the bottom or type in ‘account doesn’t exist yet

    3. Name the future account

    4. Choose an account classification for the future account

    5. Add the account to your microforecast

Once a future account has been added to your forecast, it will also appear in your Chart of Accounts in 'Step 3 - Chart of Accounts' of the company or group's Settings. Any future accounts listed in the Chart of Accounts will be a light grey colour.


Using a future account

Once a future account has been created, it will be visible within the microforecast and the main forecasting grid. The future account will function similarly to actuals accounts in your Chart of Accounts. With a future account you’re able to:

  • Add the future account to multiple microforecasts

  • Add value rules and timing profiles to a future account within a microforecast and on the baseline for the future account in the main forecasting grid.

  • Utilise a future account in schedules and journals

💡Pro Tip: Because the timing of microforecasts is easily changed, it is recommended to work with future accounts only in microforecasts, especially if the timing of future events or business changes in uncertain.

Compared to actuals accounts, the only limitations for future accounts concern adjustments and default accounts in your forecast. Adjustments cannot be made on future accounts. Future accounts cannot be set as the default Current Earnings or the default Retained Earnings account for adjustments or in the Global Forecast Settings.

📝Note: Future accounts can still be classified as Current Earnings and Retained Earnings accounts, they simply cannot be the default Current Earnings or Retained Earnings accounts.


Future account is overlapping the actuals

When the current month hits the first month where Fathom should be receiving actuals for a future account, you will want to do one of the following:


Merging a future account

Merging a future account with an actuals account will result in the future account being removed from the forecast and the Chart of Accounts. The actuals account will essentially take the place of the future account.

📝Note: To easily differentiate between accounts and avoid potential import/update issues, we recommend giving the actuals account a name that does not exactly match the future account’s name. You can change the name of the future account (e.g. add ‘*’ to the end) by following the steps below and using the Pro Tip.

The rules and values applied to the future account may remain in the forecast, depending on the option you choose when merging the future account with your actuals account.

To merge a future account with an actuals account:

  1. Select the ‘Cog/Gear’ icon in the lower left corner of the forecasting tool to open the Global Forecast Settings

  2. Select ‘Accounts’ at the top of the Forecast Settings

  3. Scroll down to the ‘Future Accounts’ section and select the account classification type

  4. Click on the ‘Three dots’ icon in the row for the future account

  5. Choose ‘Merge Future Account

    💡Pro Tip: The ‘Edit’ option allows you to change the name of the future account.

  6. Choose the actuals account from your source accounting you want to merge the future account with using the dropdown menu

  7. Decide to ‘Maintain baseline rule’ or not

  8. Select ‘Merge accounts

  9. After you have merged the future account, we recommend checking the areas of the forecast and the KPIs it was used in, to make sure the merge has transferred values to the future account as expected.

📝Note: If you have a budget amount attached to a future account, it will not be moved over to the actuals account. Instead, you will have to add the budgeted values to the actuals account in your source accounting system and update the budget in Fathom.


Maintain baseline rules checkbox

When merging a future account with an actuals account, you’re asked if you want to ‘Maintain baseline rules’.

The ‘Maintain baseline rules’ checkbox determines the following:

✔️ Maintain baseline rules

Do not maintain baseline rules

  • The value rule and timing profile applied to the future account on the baseline in the main forecasting grid (microforecasts are treated separately), will be ignored.

    The value rule and timing profile on the actuals account will remain.

  • The value rule and timing profile applied to the future account on the baseline in the main forecasting grid (microforecasts are treated separately), will override the value rule & timing profile on the actuals account.

    The new value rule and timing profile on the actuals account will remain as the future account is removed from the forecast.

  • The settings for consumption and withholdings taxes (i.e. if a tax is on for the account and the tax rate) applied to the actuals account will remain and the settings for the future account will be removed from the forecast.

  • The settings for consumption and withholdings taxes (i.e. if a tax is on for the account and the tax rate) applied to the future account will override the settings on the actuals account and the settings for the future account will be removed from the forecast.

  • If a future account has been specified as an account link in the individual account settings for a specific account on the Profit & Loss, then the future account will be removed. The default account (as specified in the Global Forecast Settings) will replace it.

  • If a future account has been specified as an account link in the individual account settings for a specific account on the Profit & Loss, then the future account will be replaced with the actuals account.

Automatic merging changes

When you merge a future account with an actuals account from your source accounting system, changes will take place automatically, regardless of the option chosen for the ‘Maintain baseline rules’ checkbox.

These changes will primarily depend upon if the forecasting component (e.g. value rule, microforecast, etc.) contains or references both the future account and the actuals account it is being merged with or only one of the accounts.

In general, the rules and values associated with the future account are favoured over the rules and values associated with the actuals account. This is because the forecasting and planning would have likely been done on the future account before the actuals account existed in the source accounting system.

Forecasting component contains…

Future account only

Actuals account only

Both accounts

Microforecast

Value rule & timing profile applied to the future account in the microforecast will remain, but the future account will be replaced with the actuals account.

Value rule & timing profile on the actuals account will remain. Account will be unchanged.

Value rule & timing profile applied to the future account will override the value rule & timing profile on the actuals account. The future account will be removed while the actuals account remains.

Schedules & Journals

Future account will be changed to the actuals account.

Actuals account will be unchanged.

The schedule or journal will be deleted as it can no longer be reconciled.

Default account linkages

Future account will be changed to the actuals account.

Actuals account will be unchanged.

Not applicable

Value rule formulas

Future account will be changed to the actuals account.

Actuals account will be unchanged.

The future account will be changed to the actuals account, so you may end up double-counting the actuals account.

Tax expense formulas

Future account will be changed to the actuals account.

Actuals account will be unchanged.

The future account will be changed to the actuals account, so you may end up double-counting the actuals account.

KPIs

Future account will be changed to the actuals account.

Actuals account will be unchanged.

The future account will be changed to the actuals account, so you may end up double-counting the actuals account in a formula KPI.


Changing the timing of a future account

If your actuals are overlapping with your forecasted values in your future account, but the forecasted amounts have not yet been realised, then you may wish to change the timing of the future account.

If the future account only has microforecast values, then you can easily change the timing of the microforecast(s) using the Business Roadmap. Simply grab and drag a microforecast on the timeline to change its timing and move it further into the future.

If you have added future account values to the baseline, then you’ll need to edit the value rule for the future account in the main forecasting grid. If the future account is used in any schedules or journals that are not associated with a microforecast, you’ll need to edit those as well to change the timing of the future account values.


Deleting a future account

To delete a future account, it must not be present in any microforecasts and cannot be a default account:

  1. Click the 'Microscope' icon and go into each microforecast containing the future account

    1. Select the ‘Three dots’ icon next to the future account in the microforecast

    2. Choose ‘Remove from Microforecast’ from the dropdown menu

  2. Select the ‘Cog/Gear’ icon in the lower left corner of the forecasting tool to open the Global Forecast Settings

  3. Select ‘Accounts’ at the top of the Forecast Settings

  4. Make sure the future account is not selected as one of the default accounts

  5. Scroll down to the ‘Future Accounts’ section and select the account classification

  6. Click on the ‘Three dots’ icon in the row for the future account

  7. Choose ‘Delete

This will remove the future account from the entire forecast and the Chart of Accounts for the company or consolidated group.


Additional knowledge & common questions:

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