Get Started: Accounting

You can access all the Accounting setups from Main Menu > Setup > Accounting.

Navigation

Main Menu > Setup > Accounting.

Accounting Periods

Accounting Periods can be used to generate Accounting reports (instead of using the Transaction Dates.) This is useful for adding backdated Transactions after a Financial period has been closed off as well as for manipulating Cost of Sales transactions to fall in the same period as the corresponding Sales transactions.

By default, this functionality is turned off and the Transaction Dates will drive the Accounts reporting.

Settings

This functionality can be enabled by setting the General Settings > Accounting > Use Accounting Periods setting = Yes.

How it works

A date field is provided for the Period date. The Period date is only available in the Ledger and visible only when the setting Accounting Periods = Yes.

When the Transaction date is set, the Period date is automatically set to the same date as the Transaction date. When the Period date is set, however, the Transaction date is not updated.

• Close Off Dates - If you are using Periods, the Transaction date may be set to a date which is on or before the Transaction’s Close off date. The Period date will then be set to the first day after the Close off date.

• Customer/Supplier Age Analysis - By default, the Customer/Supplier Age Analysis will work on the Transaction Date. To generate an Age Analysis that matches the Financial Statements when using accounting periods, however, you need to check the Periods check box next to the date filter. See image below:

• Financial Reports (VAT Control, Income Statement, Balance Sheet, Trial Balance) will automatically work on either the Transaction Date or on the Period Date depending on the setting above.

• Ledger - Date Filter - A Period option has been added to the Ledger’s data filter. When it is checked, the date filter searches on the Period Date. By default this is unchecked. See image below:

Account Categories

The Account Categories contain all the settings that determine how the Trial Balance, Income Statement and Balance Sheet is displayed. The Trial Balance is effectively a combination of the Income Statement and Balance Sheet and will therefore be displayed according to how the Income Statement and Balance Sheet are set up. The screenshot below illustrates a typical setup which can be used for a small to medium sized company.

1. Description - This is the Category Description

2. Type - This is the Income Statement or Balance Sheet category in which linked Accounts will be displayed. IS = Income Statement (Profit = Sales - Cost of Sales - Expenses) and BS = Balance Sheet (Assets = Equity - Liability).

3. Report - This shows the value that will be reported on the Income Statement and the Balance Sheet - options include: Inc. VAT, Exc. VAT and VAT.

4. VAT - Check the Categories that must update the VAT Control account.

5. Fixed Categories - Fixed Categories for Receivables (Debtors) and Payables (Creditors) are created by the system. These Categories must have an ID of -1 and -2 respectively.

Accounts

The Accounts are linked to the Account Categories. The following screenshot explains how to setup the chart of Accounts.

1. Description - This is the Account Description

2. Account Number - Using Account Numbers is optional and can be used when the chart of accounts is large and confusion might arise from using Account Descriptions only.

3. Category - Links to the Account Category

4. Currency - Only required for foreign currency bank accounts.

5. Warning - Displays error warnings.

6. A Payables (Creditors Control) account needs to be created and linked to the Payables Category.

7. A Receivables (Debtors Control) account needs to be created and linked to the Receivables Category

8. A Retained Income account needs to be created an linked to the Equity Category

Grouping Accounts

Accounts which are linked to the same Category can be grouped, see image below. In the example below, Vehicle Expenses will be displayed on the Income Statement as the sum of Fuel & Oil, Insurance and Repairs and Maintenance.

The parent account (in this example the Vehicle Expenses account) can not be transacted on, it is only used for Reporting purposes.