Some source systems have a specific entry for Retained Earnings. If your source system doesn't, our team likely set up Retained Earnings for you during implementation.
This article will help you understand how our team configures Retained Earnings in Cube so you are empowered to publish any adjustments accurately, ensuring efficient management of your financial data.
Your dimension member names may vary from the examples shown below. If you use one of the formulas from this article, be sure to match the dimension names to your Cube.
How Retained Earnings is configured in Cube
Cube rolls Net Income over to Retained Earnings at the beginning of the year using three accounts. The names may vary, but the function is the same:
- Net Income / Loss
- Retained Earnings
- Retained Earnings Adjustment
The accounts in the image below show an example of the Cube-created account dimension members and an account dimension member connected to a source system (30000 - Retained Earnings).
Net Income / Loss
Net Income / Loss, also known as Net Profit, is an account formula dimension member on the Income Statement that calculates the amount of revenue remaining after all Cost of Goods Sold, Expenses, Other Income, and Other Expenses in a period. Retained Earnings is an accumulation of Net Income over time.
Standard formula (your formula may vary depending on your account names):
"Income" - "Cost of Goods Sold" - "Expenses" + "Other Income" - "Other Expense"
Retained Earnings
The Retained Earnings dimension member is a formula that calculates the retained earnings including any adjustments.
Standard formula (your formula may vary depending on your account names):<RUNNING_TOTAL("Net Income / Loss")> - <YEAR_TO_DATE("Net Income / Loss")>
+ <RUNNING_TOTAL("Retained Earnings Adjustment")>
Retained Earnings Adjustment
An additional dimension member, the Retained Earnings Adjustment, populates the opening balance and holds adjustments for the Retained Earnings.
This dimension member is used to handle two scenarios:
- Populating the opening balance of Retained Earnings by Entity/Company via publishing to Cube from your spreadsheet
- Capturing any variances to Retained Earnings not brought in from a source system data import.
Publish adjustments to Retained Earnings
Publishing is necessary when using source systems such as NetSuite that do not track Retained Earnings adjustments in NetSuite as an entry, because this can cause variances in equity. The Balance Sheet can be balanced by publishing the difference to Cube from your Spreadsheet App.
Learn more about publishing data to Cube.