Journal Entry Controls

This page documents the complete control framework around journal entries in PinkApple ERP — from creation through posting, approval, and correction.

Journal Entry Lifecycle

DRAFT → PENDING_APPROVAL → APPROVED → POSTED
                ↓                        ↓
            REJECTED              REVERSED / VOIDED

State	Description	Can Be Modified?
DRAFT	Entry created but not submitted	Yes — amounts, accounts, memo can change
PENDING_APPROVAL	Submitted for approval	No — locked for review
APPROVED	Passed approval chain	No — awaiting posting
POSTED	Written to the ledger	No — permanent record
REJECTED	Returned by approver with comments	Can be edited and resubmitted
REVERSED	Offset by a new correcting entry	No — both entries remain
VOIDED	Marked invalid before posting	No — remains as void record

Who Can Do What

Creation Controls

Control	Enforcement
Only authorised users can create entries	CREATE_GL_JOURNAL_ENTRY permission required
Entries must specify a valid fiscal period	System resolves from journal_date — rejects if period is closed
All COA accounts must be active and approved	Invalid COA IDs are rejected at creation
Entry must have at least 2 lines	Single-line entries are blocked
Debits must equal credits	Validated before save; unbalanced entries rejected
Business unit must be specified per line	Each line carries explicit BU assignment
Control accounts require sub-ledger	If a COA has sub-ledgers, sub_ledger_id is mandatory

Approval Controls

Control	Enforcement
Creator cannot approve own entry	System enforces different user_id for creation vs approval
Monetary thresholds trigger multi-step approval	Configurable per approval policy
Approval chains are sequential	Step 2 cannot approve until Step 1 completes
Rejected entries require comments	Approver must provide rejection reason
SLA tracking on approval steps	Escalation if step exceeds configured hours
Authority limits per user	Maximum amount a single approver can authorise

Posting Controls

Control	Enforcement
Only approved entries can be posted	approval_status = 'APPROVED' check
Posting date must be in an open period	HARD_CLOSED or LOCKED periods block posting
Soft-closed periods require elevated permission	allow_soft_closed_posting flag
Backdating beyond lag window blocked	Configurable GL_MAX_POSTING_LAG_DAYS
Future posting can be disabled	GL_ALLOW_FUTURE_POSTING configuration
Till-based posting requires open business day	Teller entries linked to active till session

Posting Channels

Every entry is tagged with how it was created:

Channel	Description	Approval Behaviour
BACKOFFICE	Manual entry by accountant	Full approval chain applies
TELLER	Posted through till/teller session	May have lower threshold
SYSTEM	System-generated (EOD, accruals)	Typically auto-approved
API	External integration	Depends on API configuration

Batch Management

Journal entries are grouped into batches:

Batch State	Description
OPEN	Batch accepting new entries
CLOSED	No more entries can be added
CANCELLED	Stale batch cancelled by cleanup process

Stale Batch Cleanup

The system automatically cancels:

• DRAFT batches older than 30 days (configurable)
• OPEN batches older than 60 days with no posted entries

This prevents abandoned batches from cluttering the ledger.

Correction Procedures

Before Posting (DRAFT/PENDING)

• Entry can be edited directly (amounts, accounts, memo)
• Entry can be voided — sets voided_flag = 1, excluded from all calculations
• Both actions are logged in the activity trail

After Posting

• Entry cannot be edited or deleted
• Reversal is the only correction method:
  1. System creates a new entry with inverted amounts
  2. Original entry: reversed_flag = 1, reversed_entry_id = new_entry_id
  3. New entry: references original in source_id
  4. Both remain permanently visible

Auto-Reversal (Accruals)

Entries with auto_reverse_date set are automatically reversed on that date:

• Used for month-end accruals that should reverse on day 1 of next period
• System procedure process_accrual_auto_reversals handles this
• Reversal is logged with source_type and links to original

Numeric Precision

Aspect	Precision
Journal line amounts	DECIMAL(18,4) — 4 decimal places
Exchange rates	DECIMAL(18,6) — 6 decimal places
Balance tables	DECIMAL(18,2) — 2 decimal places
Balance check tolerance	0.01 — entries within 1 cent are considered balanced

Concurrent Access Controls

• Optimistic locking via versioning timestamp on all GL tables
• Batch-level locking — only one user can post to a batch at a time
• Period-level protection — period state changes are atomic transactions

Regulatory Compliance Mapping

Requirement	How PinkApple Meets It
SOX Section 302 (Management certification)	Complete audit trail with user attribution
SOX Section 404 (Internal controls)	Segregation of duties, approval chains, authority limits
IAS 8 (Accounting policy changes)	Adjustment periods (13-16) for prior-period corrections
ISA 240 (Fraud considerations)	Activity log, IP tracking, same-user approval prevention
IFRS 13 (Fair value)	Exchange rate sources tracked per entry
Local banking regulations	Period lock, daily balance capture, till reconciliation

Control Summary for Auditors

The following controls operate automatically without user intervention:

1. ✅ Every entry is balanced (debits = credits) — enforced at database level
2. ✅ Every action is logged with user, IP, timestamp — cannot be disabled
3. ✅ Posted entries cannot be modified — only reversed
4. ✅ Period controls prevent back-posting — state machine enforced
5. ✅ Control accounts require sub-ledger specification — prevents unallocated postings
6. ✅ Sub-ledger totals checked against control at period close — blocks close if mismatched
7. ✅ Stale drafts auto-cancelled — prevents orphaned entries
8. ✅ Cash accounts checked for overdraft — prevents negative cash balances
9. ✅ Approval enforces different user than creator — SOD compliance
10. ✅ Daily balance capture at 10 hierarchy levels — full audit evidence

Next Steps

• Audit Trail & Controls — Activity log structure and immutability guarantees
• GL Posting Approval — Configuring approval chains and authority limits
• Month-End Close — Period close procedures
• Year-End Close — Fiscal year close and retained earnings