Auto-Accruals & Business Health Metrics
Define each recurring adjusting entry once. Kantivo works out every period's amount, lines the entries up as they fall due, and posts them when you say so.
Overview
Accrual-basis books carry a set of entries that repeat every period: a prepaid asset released to expense, an advance payment released to revenue, an expense or income accrued before the paperwork arrives. Auto-Accruals turns each of those into a schedule, so the arithmetic and the reminder are both handled by the software.
Open Reports → Auto-Accruals. The screen has three tabs: Schedules, Pending Entries and a Setup Guide with worked examples.
Schedule Types
Every schedule names a source account on the balance sheet and a target account on the income statement. The type sets the direction of each entry:
| Type | Typical use | Entry each period |
|---|---|---|
| Prepaid Expense Amortization | Paid in advance, used up over time | Dr Expense, Cr Prepaid asset |
| Deferred Revenue Recognition | Collected in advance, earned over time | Dr Deferred revenue, Cr Revenue |
| Accrued Expense | Incurred now, paid later | Dr Expense, Cr Accrued liability |
| Accrued Revenue | Earned now, billed later | Dr Accrued receivable, Cr Revenue |
Prepaid Expenses
A $12,000 annual policy paid in January belongs on the balance sheet first and in expense at $1,000 a month.
- Record the payment to a prepaid asset account, such as Prepaid Insurance
- Click + New Schedule and choose Prepaid Expense Amortization
- Source: Prepaid Insurance. Target: Insurance Expense
- Total $12,000, 12 periods, monthly, starting at the end of the first month covered
- Save. The per-period amount ($1,000) is shown as you type
| Account | Debit | Credit |
|---|---|---|
| Insurance Expense | $1,000 | |
| Prepaid Insurance | $1,000 |
Deferred Revenue
The reverse case: a customer pays $12,000 up front for a year of service. Record the receipt to a deferred revenue liability, then create a Deferred Revenue Recognition schedule with that liability as the source and your service revenue account as the target.
| Account | Debit | Credit |
|---|---|---|
| Deferred Revenue | $1,000 | |
| Service Revenue | $1,000 |
Straight-line release of a single prepayment suits a schedule. Contracts with several performance obligations, price allocation or modifications belong in Revenue Recognition.
Accrued Expenses & Revenue
Use Accrued Expense for costs that build up before you are billed, such as an annual audit fee or a bonus pool, and Accrued Revenue for income earned before you invoice it. Enter the total and the number of periods, and Kantivo divides it.
| Account | Debit | Credit |
|---|---|---|
| Audit Fees (expense) | $500 | |
| Accrued Liabilities | $500 |
When the real invoice arrives, post it against the accrued liability account so the expense is not counted twice.
Reviewing and Posting
When an entry's date arrives, it appears on the Pending Entries tab with its date, schedule, type, amount, accounts and period number (for example "3 of 12").
- Post All Entries posts everything due
- Post Now on a schedule posts that schedule's due entry only
- Each posting is an adjusting entry on its scheduled date, referenced
ACCR-plus schedule and period numbers - Overdue periods are each posted with their own date, so a late catch-up still lands in the right months
- Entries dated on or before your lock date are held back and reported, not posted
On the Schedules tab, every schedule shows a progress bar, and offers Pause / Resume and a History of the entries it has posted.
Business Health Metrics
The operating metrics live in the Business Health panel on the Dashboard. They are calculated from your ledger each time the dashboard loads. You can hide the panel if you do not use it.
MRR, ARR & Churn
These cards appear once you bill customers through subscriptions in recurring billing:
- MRR: active subscriptions converted to a monthly figure (a $1,200 yearly plan counts as $100; quarterly plans are divided by three; weekly plans multiplied by 4.33)
- ARR: MRR × 12
- Active subscriptions: the count of subscriptions currently active
- Churn rate: subscriptions cancelled in the last 30 days, as a percentage of those active at the start of that window
One-off invoices and setup fees are not subscriptions and do not affect MRR.
Burn & Runway
These are shown for every company, whether or not it sells subscriptions:
- Monthly revenue: income posted in the last 30 days
- Burn: expenses posted in the last 30 days
- Net burn: revenue less burn, green when positive and red when negative
- Runway: cash in bank accounts divided by the monthly shortfall, in months. Shown in red under 6 months, amber under 12, and as "10+ yrs" beyond ten years
When last-30-day revenue covers expenses, there is no shortfall to divide by and runway reads Profitable.
Getting Started
- Make sure your chart of accounts has the balance-sheet accounts you need: Prepaid Expenses, Deferred Revenue, Accrued Liabilities, Accrued Receivables
- Create a schedule for a prepayment you already have on the books
- Check the Setup Guide tab if you are unsure which account goes on which side
- At month end, open Pending Entries and post what is due
- Glance at Business Health on the Dashboard
FAQ
Will entries post if I forget to open Auto-Accruals?
No. Due entries wait on the Pending Entries tab, each keeping its own date, until you post them.
What does deleting a schedule do?
No further entries are produced. Entries already posted stay in the ledger.
Why is runway showing "--"?
No expenses have been posted in the last 30 days, so there is no burn to measure.
Do one-time fees count toward MRR?
No. Only active subscriptions contribute to MRR and ARR.