AMORTISATION

Prepayment means you have a payment for an expense, say, $8000 for a period e.g. for Jan to April, 2009. If you are going to close the book as at 31 March, 2009, the expense for April $2000 will then be regarded as a prepayment as it related to next accounting period.
Amortization is for written down the value of an asset due to wear and tear just like depreciation. If a building costing 1,000,000 and its life will be 50 years, then you have to write down the asset value by $20,000 each year as an amortization to building.