About Prepaid Expenses

You can use the Prepaid Expenses functionality to generate a series of journals to spread a payable invoice expense across future financial periods. This allows you to quickly and easily spread costs across the periods in which they are incurred. For example, you may be billed for insurance annually but spread the payments over 12 months.

You create prepaid expense journals based on a prepaid expenses schedule definition. This is a template that defines the period interval and whether the expense is pro-rated for the initial month. For more information, see What Is a Prepaid Expenses Schedule Definition?

Prepaid expenses journals are generated by a batch process.

Before You Start

• Make sure that the Prepaid Expenses feature has been enabled in your org. For more information, see Setting up Prepaid Expenses.
• Create any additional prepaid expenses schedule definitions that you need. For example, quarterly. A monthly schedule definition is created in your org during configuration. For more information, see What Is a Prepaid Expenses Schedule Definition?
• Ensure that you have selected the Prepaid Expense checkbox on any expense lines you want to generate prepaid expenses journals for and that you have provided a "date from" and "date to". For more information, see Payable Invoice Line Items.