Resolving Out of Balance (OOB) Projects

Castaway is a 3-way forecasting and reporting system, which means that the Profit & Loss, Balance Sheet, and Cashflow reports are all integrated. By design, these reports should always be in balance. However, if your reports are Out of Balance ('OOB'), here’s how to track down the problem.

Start by reviewing the projected Balance Sheet:

1. From Analysis > Reports, select the Balance Sheet report. If Actuals are enabled, select ‘Projected’ from the Report On selector
2. Make sure all periods are visible. If necessary, go to the Report view settings and select Show Opening
3. From the date setting options, make sure the Month view is selected

Next, we’ll look at how the OOB value(s) behave over time. We can tell a lot from knowing when the OOB starts, whether the values are constant or changing over time, or if they start from an Opening, Actuals, or Projected month.

Where your OOB starts from the Opening Month

If the OOB starts in the Opening Balance Sheet AND is always the same number, the problem is likely to have arisen from incorrect data entry:

1. Navigate to Forecast > Actuals Data > Balance Sheet Data
2. Check that your Balance Sheet data entry is correct, including the Retained Earnings

Why Retained Earnings?

Castaway carries the Retained Earnings forward month-by-month in the designated Retained Earnings Element.

Ensure the Actuals Retained Earnings are properly entered against the Castaway element at the bottom of your Balance Sheet Data.

If you used Integrations to import your Opening data, remember to click on Save Changes in Forecast > Actuals Data to register the changes in your model after importing the data.

When using the Excel or Quickbooks Integration, the Opening Retained Earnings needs to be manually entered in Forecast > Actuals Data > Balance Sheet Data  > Retained Earnings.

Where your OOB starts from an Actuals month

If the OOB starts from an Actuals Month, the problem is likely to have arisen from:

• incorrect data entry
• incomplete mapping from your general ledger, or
• a prior period adjustment that hasn’t been transferred across to Castaway.

Follow these steps in sequence until you identify the problem:

1. First, go to Forecast > Actuals Data > Balance Sheet Data and focus on the OOB month(s)
2. In each OOB month, check that your Balance Sheet data entry is correct
3. If you have imported data via Integrations, check you have not missed any accounts or that your archived accounts do not have balances against them
4. Next, check the Retained Earnings figure calculated by Castaway each month agrees with your general ledger numbers
5. Alternatively, check your general ledger for any direct journal entries into a Retained Earnings account. These will need to be manually updated in a separate Equity element in Castaway because Castaway automatically calculates Retained Earnings in Actuals months to ensure accounting integrity
6. Go to Forecast > Actuals Data > Profit & Loss Data and check that your data entry is correct
7. Reconcile the Net Profit after Tax figures each month against your general ledger reports to rule out any prior period adjustment that has not been reflected in Castaway

Still Out of Balance?

We recommend Clearing your Actuals Data and reimporting. This simple step will not impact your mapping and is very quick to complete. 

Once you have cleared your data go back into the external sources screen, click on the opening balance drop down and import your opening balance. Next click on the actual value drop down and import your months again. Once you have imported go and check your actuals data table again.

Where your OOB starts from a Projected month

If the OOB starts in a Projected month, it may have arisen from an accounting illogicality in an Inventory element:

1. Review all of your Inventory elements and identify any elements with the Purchases Method as Enter Closing Inventory Balance
2. If the element has a Total Purchases value of 0 in the OOB month, look more closely at the calculation logic. Castaway is not designed to accept a negative value for the calculated Total Purchases. Therefore, ensure that the calculation of Opening Inventory Balance less Total Inventory Outflow less Closing Inventory Balance will not result in a negative number. If it will, adjust the Cost of Goods Sold or the Closing Inventory balance to correct the problem.

Tip:

In the Inventory element data entry screen, a grey line named Purchases OOB will indicate if the closing inventory balance value entered is mathematically correct or not. Keep an eye on this line when adding the data to make sure you get a balanced transaction.

Where the OOB is within your Budget or Forecast Report

To resolve an OOB value in the Budget or Forecast layer of your report:

1. Roll back the Actual period to the first month you intend to start your budget e.g. if you'd like to resolve your OOB budget from Jul22, roll your Actuals back to Jun22
2. Check your Projected values to make sure they are in line with your intended budget numbers
3. Switch to the Balance Sheet report, select ‘Projected’ from the Report On selector, and make sure all periods are visible and balanced
4. Save the Budget (or Forecast) to overwrite the unbalanced Budget/Forecast by navigating to Manage Budget in the top right within any workspace of your Project and selecting the option in the pop-up modal

To avoid having an OOB Budget or Forecast:

• ensure your Project is balanced before you Save your Budget or Forecast
• don't delete any elements that have an Opening or Actual balance. This can cause all 3 layers of your Project file to be OOB

If none of these steps help you resolve your OOB, contact our Customer Success team for assistance.