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Published: 27 November 2010
Accounting: 1. Recording-------------Journal---Book of Original Entry Furniture....................................1000 Cash ................................................1000 2. Classify--------grouping the transactions 3. Summarizing--------accountwise totalling ---------------------------------------------------------------------- CASH FLOW STATEMENT...... Cash Inflow............. 1. CAsh Sales 2. REceipts from your customers 3. Loan from Bank 4. Personal Loan 5. Receipt from Projects 4. Govt borrowings Total .................................***** Less: Cash Outflow.............. 1. Cash purchase 2. Payments to suppliers 3. Repayment of loan 4. 5. Total ................................****** Net Inflow/Net Outflow ------------------------------------------------------------------------------------------------------------------- Proprietorship----- Owners' Capital------------10000 Less: Drawings--------------2000 ------- 8000 Add: Profits during the period 3000 ------ 11,000 ====== Partnership------------------- Partner A --------- Capital Less: Drawings Add: Profits Partner B ---------- Capital Less: Drawings Add: Profits Company----------------- Owners' Equity Share Capital....................... Reserves & Surplus................. ====================================================================================== Incomes Less: Expenses Profit All Expenses Less: Incomes Loss ============================================================================================== Building: 1. Purchasing at a cost of 10,00,000 Building.......Dr 10,00,000 Bank...........Cr 10,00,000 2. Benefit that the Co. enjoys/ Life of the asset---------> 10yrs 3. Every year....1/10th of the value Has to show 1/10th of the value i.e. 1,00,000 every year P& L A/c Depreciation............1,00,0000 Balance Sheet Fixed Assets ------------ ============ Building -------- Original Cost 10,00,000 Less: Depcn during the yr 1,00,000 Written down value.................900000 Dr...Depreciation .............1,00,000 Cr...Building............................1,00,0000 ========================================================================================== Accounting Entries 1. Dr....Furniture.........................50,000 Dr....Cash..............................50,000 Cr.....Ram's Capital a/c.............................100,000 2. Dr.......Inventory...................75000 Cr.......X a/c/ Accounts Payable..................75000 3. Dr........Cash.....................100000 Cr........Sales...(Income).............................100000 4. Dr......Cost of Goods Sold..(Expense).........50000 Cr......Inventory................................50000 5. Dr. Rent............(Current mth).................1000 Dr. Rent Prepaid/Advance.....(Next mth)...........1000 Cr. Cash................................................2000 6. Dr.......Salary...............................5000 Cr.......Cash..........................................5000 7. Dr....Interior Decoration....................2500 DR....Prepaid/...............................2500 Cr.....Cash...........................................5000 8. Dr.... Y a/c/ Accounts Receivable..............18000 Cr......Sales a/c....................................18000 Dr.........COGS........................10000 Cr. .......Inventory...........................10000 9. Dr......Vehicle......................25000 Cr......Bank.................................25000 10. Dr........Bank.................50000 Cr.........Cash......................50000 General Ledger 1. Central Repository TransactionS: 1.Entering Journal Entries 2. Posting 4 Cs ==== 1.Chart of Accounts/Accounting Structure ======================================== Representing the Account heads by codes-Numeric, Alphabetical or Alphanumeric Mandatory/ Min no of segments----2 Company--> Balancing segment Account---> Natural Account segment Max----> 30 Advised----5/6 Segments in the Account heads-- Company= Company1----01 Company2----02 Company3---03 . . Company99---99 Departments== Dept 1---001 Dept2----002 Dept3----003 Dept 100---100 Division Cost Center Location Company-Department-Location-Division-Account 01-001-15-5-1110 (Cash) Furniture-1501 02-003-10-4-1501 020031041501 02-003-10-4-1501 2. Calendar ======== Jan--Dec Fiscal Year 3. Currency ======= USD GBP Rupees 4. Accounting Method Flexfield 1.Define Key information specific to that module-----------Key Flexfield 2.Enter additional information specific to the organization----Descriptive Flexfield Key F/f 1.Mandatory 2.Optional In General Ledger module 2 Key Flexfields 1.Accounting Flexfield 2.GL Ledger Flexfield ACCOUNTING FLEXFIELD IS USED TO DEFINE THE CHART OF ACCOUNTS/ACCOUNTING STRUCTURE Step 1 ======= Define---- Chart of Accounts/Accounting Flexfield/Accounting Structure ======================================================================== a) (N)---Setup> Financials> Flexfields> Key > Segments Query Mode: F11 To execute: Ctrl+F11 b) Segments Summarydefine the names of the segments c) Define the Value Set Right justify and zero-filled numbers Size-3 1 001 10 010 Yellow----mandatory White-----Optional d) Select the value set for each of the segments e) Choose the Flexfield Qualifiers 2 mandatory Flexfield Qualifiers Balancing segment Natural segment f) Cross Validate segments Allow Dynamic inserts Freeze Flexfield def Compile 2. Define the calendar (N) Setup> Financials> Calendars> Types (N) Setup> Financials> Calendars> Accounting 3. Enable Currency (N) Setup> Currencies> Define 4. Entering Values (N) Setup>Financials> Flexfields> Key> Values Account No. SET UPS ========= SETUP THE LEDGER Payables Purchasing Inventory Defining Items either in Inventory or in Purchasing Module Items: Inventory Item.........Production.....Purchasing module & Payables Module Expense Item..........................Purchasing module a& Payables module Capital item---------------------------------------------------------------Fixed Asset P2P Cycle (Procure to Pay Cycle) ======================= Demand > Requisition > Request for Quotation (RFQ) > Quotation > Quote Analysis > Send Purchase Order > Receiving > Enter Purchase Invoice > Payment to the Invoice > Invoice NO--100...............100000 Received 95....................95000 Record.......................-5000 Short receipt-5 Part reversal -for 5 units---Debit note or a credit note Going for inspection at the time of receipt 5 items don't meet quality standards Invoice-100 Received95 Meet the Quality---90 Account for 90 units only ===================================================================================================================================================== MATCHING ======== 2 WAY MATCHING --------------- Matching the Invoice with the Purchase Order 1. Matching Inv Rate with PO Rate 2. Matching Inv Qty with PO Qty 3 WAY MATCHING --------------- -- Matching the Invoice with both PO and Receipt 1. Matching Inv Rate with PO Rate 2. Matching Inv Qty with PO Qty 3. Matching Inv Qty with Receipt Qty PO---100 Invoice--95 Received-90 4 WAY MATCHING ------------------ MAtching with Invoice, Receipt and Acceptance Report 1. Matching Inv Rate with PO Rate 2. Matching Inv Qty with PO Qty 3. Matching Inv Qty with Receipt Qty 4. MAtching Inv Qty with Accepted Qty PO-100 Inv-95 Recd-90 Accepted-85 ================================================================= PAYABLES SET UPS 1. Defining the Financial Options (N) : Setup > Options > Financials 2. Defining the Supplier Options 3. Payables Option * Accounting Options At the time of payment-- Dr......AP/Invoice AP Accrual Cr.....Cash Clearing a/c At the time of Clearing---- Dr ...Cash clearing a/c Cr.....Cash a/c 4. Defining Payment Terms (N): Setup> Invoice> Payment Terms 3 Types of Payment Terms: * Fixed *Day's Basis * Proxima Term DAYS' BASIS 2/10 Net30 3/15 Net 45 Immediate Net 15 Net 30 Net 45 PROXIMA TERM Cut off Day--1st day of the cycle Credit card bills: Date on which the bill is generated Cycle: 10th of the month to 9th of the following month Due date---20th of the month 10/8/2010..........10/7/2010 to 9/8/2010.....23/8/2010 10/9/2010..........10/8/2010 to 9/9/2010......23/9/2010 10/10/2010.........10/9/2010 to 9/10/2010....23/10/2010 ====================================================================================== 4. Distribution Sets Full Type Skeleton Type Full type: same code combination, same percentage/ proportion of invoice amount ------------------------------------------------------------------------------- Raw Mat Inv1(75/20/5) Raw material cost............75% Taxes........................20% Freight......................5% Entered Invoice-1001.....Inv value 10000........................Raw Mat Inv Defining: Distribution: Raw MAt cost........7500 Taxes...............2000 Freight..............500 ------------------------------- Rent Invoice Rent Distn set: 01.100.5100..........10% 01.120.5100..........25% 01.150.5100..........30% 01.200.5100..........20% 01.300.5100..........15% Actually Entering: Enter a Rent Invoice------100000..............Rent Invoice Distn Set Distribution : 01.100.5100..........10,000 01.120.5100..........25,000 01.150.5100..........30,000 01.200.5100..........20,000 01.300.5100..........15,000 Skeleton Type ------------- same code combination, but proportion not known Rent Invoice -Skeleton Rent Distn set: 01.100.5100 01.120.5100 01.150.5100 01.200.5100 01.300.5100 ====================================================================================== Defining Suppliers (N): Suppliers > Entry Suppliers--------Company Multple MULTI ORG AND MOAC ================== 1. Define the following responsibilities: ***SA HRMS ***SA Inventory Assign the Resps to the User 2. Define the Profile Options for *** SA HRMS HR: Security Profile......................SA Business Group HR: Business Group........................SA Business Group HR: User Type..............................HR User ***SA Inventory MO: Security Profile....................SA Business Group HR: Security Profile....................SA Business Group HR: Business Group......................SA Business Group 3. DEfine the Multi Org Structure -------------------------------------------------------------------------------------------------------- Business Group.................SA Business Group.........already defined........from the HRMS resp earlier Legal Entity...................SA Legal Entity............already defined.........while defining ledger Ledger.........................SA Primary Ledger..........already defined Operating Unit.................Define one more Operating Unit....we added one more Operating Unit...Accounting Setup Manager --------------------------------------------------------------------------------------------------------- Inventory Organization..........SA Inventory Organization Switch Resp: SA Inventory (N):Inv : Setup> Organizations> Organizations 4. MOAC--Multi Organization Access Control Step 1 Define Hierarchy: (N):SA HRMS: Work Structures>Organization > Hierarchy Name Version Save and close Query Choose the subordinates Step 2: We define the MOAC Security Profile (N): SA HRMS: SEcurity> Profile Step 3: Run the Security List Maintenance Report (N) : SA HRMS: Processes & Reports> Submit Processes & Reports Step 4: Define the Payables Responsibility step 5: Assign the Resp to the user Step 6: Choose the Profile Options for your Payables Resp Sys Administrator : MO: Security Profile.............> SA MOAC HR: Security Profile.............> SA Business Group HR: Business Group..............> SA Business Group ======================================================================================================================================================== PAYABLES SETUPS ---------------- 1. OPTIONS a)FINANCIALS OPTIONS (N): Setup > Options> Financials b)Payables System Setuo c) Payables Option ---------------------------------------------------------------------- 2140 Inventory AP Accrual Yes Yes Liability 3150 Purchase Price Variance Yes Yes Expense 3160 Invoice Price Variance Yes Yes Expense 1415 Deferred COGs Yes Yes Assets 5101 Cost of Goods Sold Yes Yes Expense ------------------------------------------------------------------- 2. Defining Payment terms (N): Setup> Invoice> Payment Terms 3. Defining Distribution Sets (N): SEtup> Invoice> Distribution Sets 4. Entering Suppliers (N) : Suppliers > Entry =============================================================================================================================== Open the 1st period: (N): Accounting > Control Payables Periods ==================================================================================================================== TRANSACTIONS: (N): Invoices > Entry> Invoices i) Entering Invoices with manual distributions Items Taxes Other charges Freight ii) Entering Invoices with Distribution Sets ----------------------------------------------------------------------- Types of Invoices: Standard---normal Trade Invoices which can be entered without matching Credit Memo- is a negative invoice that we receive from our Suppliers Debit Memo- is a negative invoice that we send to the supplier Prepayment---Pay an advance to the supplier which can be adjusted against future Invoices ============================================================================================================ DEfining Recurring Invoices: Step 1: Define a Special Calendar (N): Setup > Calendar > Special Calendar Step 2: Open all the periods in your Payables Calendar (N) : Accounting > Control Payables Periods Step 3 : Define the REcurring Invoice (N): Invoices> Entry> Recurring Invoices Step 4 : Query all the Invoices from the Invoice Workbench (N): Invoices> Entry > Invoices Step 5 : Follow the processses ENTERING VALUES Realized Gains ------7830.........Expenses REalized Losses-----7840..........Expense Tax ----------------2520..........Liab Cross Currency Rounding 7826.....Exp Miscellaneous.........5512........Exp\ Material..............1200 --------------------------------------------------------------------------------------------- PAYABLES CONTD: ---------------- ENTERING invoices 1. Entering Invoices with Manual Distribution *Enter Invoice Header *Enter the Lines *Enter the Distn *Save * Validation *Accounting 2.Entering Invoices with Distribution Sets a) Full Type b) Skeleton 3.Debit Memo/Credit Memo 4. Recurring Invoice--complete the process after querying in the resp periods/months ----------------------------------------------------------------------------------------------------- 5. EXPENSE REPORT a) Create an Employee HRMS: People > Enter and Maintain b) Define an Expense Report Template Payables: Setup > Invoice > Expense Report Template c) Run the Expense Report Export Program d) Query the Expense Report , Complete the steps for the Invoice ============================================================================================================ RECEIVABLES ============ ORDER TO CASH CYCLE Order Management Receivables Cash Managemnet General Ledger * Entering Invoices---Automatically generated based on Sales Orders in Order Management Module * Enter details of Customers *Receipts and Remittances ----------------------------------------------------------------------- Receipts--Instruments / Modes of payment in seetlement of the Invoices Remittance---sending to the Bank for clearance and credit --------------------------------------------------------------------------- Order to Cash Cycle: (Order Management) Entering Sales Order.....> Book Sales Order ...> Picking & Staging ....> Shipping...> Run the Workflow Background Engine...> (Receivables) Entering Transactions...> REceipts....> Remittances...> Clearing of Transactions > Reconciliation...> Transfer to GL Qty Rate Dates Ship-to details --------------------------------------------------------------------------------------------------------------------------------------------------- 1. DEfining the Receivables REsponsibility 2. Assign to the User 3. Choose the Profile Options for Receivables MO: Security Profile HR: Security Profile HR: Business Group 4. Switch Responsibility 5. Login to REceivables Resp 6. Systems Options Setup> System> System Options 7.Payment Term Will always apply to the customers (N): Setup> Transactions> Payment Terms Invoice -------- Line 1 Line 2 Line 3 Line 4 : : : ---------- Lines Total...........10000 Misc Chgs...............2000 ----------- Subtotal..............12000 Freight.................500 Subtotal.................12500 Tax.....................1250 ------------- Invoice Total Lines Total + Tax=---10000+10%---11000 Discount amt---on 11000--- --------------------------------------------------------------------------------- CUSTOMER PROFILE CLASS ----------------------- * volume of business * Credit profile * Payment Term Excellent Good Average Group 1----45 days paymt term Group 2----30 days Group 3----15 days Group 4----Immediate (N) : Customers > Profile Classes Step 1 : DEfine the Payment Term Step 2: Statement Cycles Step 3: Auto Cash Rule Set Setup > Receipts > Autocash Rule Sets Autocash rule sets are a set of rules which specifies the order in which the amounts received can be applied to overdue invoices.. Customer--1..............Payment term 30 days Inv 101....dt 1-08-10.....................25000.......-(20000.)......5000..0 Inv 302....dt 20-8-10.....................30000.........(30000)......0 Inv 567....dt 15-9-10....................100000.....................0 --------------------------------------------------------- Inv 734...dt 2-10-10....................50000....................0 Inv 800...dt...15-10-10....................10000...............0 ----------------------------------------------------------- Credit Balance ......................................................(5000) 1Receipt...20000 2 Receipt...30000 3 REceipt ...170000 Rule 1--Match with Invoice Rule 2--Oldest Invoice First Open Balance= Invoice Amount-Discount-Amount Received+ Finance Charges Please enter these values Miscellaneous Revenue................4150..........Revenue Receivables Factoring/Remittance......1245.........Assets Unapplied Cash .......................1240.........Assets Unbilled Receivables..................1232.........Assets Tax payable............................2520.........Liabilities Freight ...............................7220.........Expenses Bank Charges............................7870........Expenses Autoaccounting Clearing.................1222........Assets Unearned Revenue........................2550........Liablities =================================================================================================== PAYABLES ========= PAYMENT ADMINISTRATOR SET UPS ============================= 1. Define a Payment Format N: Setup > Payment> Payment Administrator> Payment Format 2. DEfine the Payment Method N: Setup > Payment> Payment Administrator> Payment Method 3. Define the Payment DEfaulting Rules 4. DEfine Payment Process Profiles --------------------------------------------------------------------------------------------------------------------- DEFINING BANKS =============== Step 1: Defining Banks Payables: Setup > Payment > Banks and Bank Branches Step 2 : DEfining Bank Branches Step 3: Give Access to the Bank Account --Legal Entity ================================================== USER MANAGEMENT RESPONSIBILITY USING THE SYSADMIN LOGIN --------------------------------------------------------- 1. Login to User Management REsp 2.Choose Roles and Role Inheritance 3.Create a Role =============== Code NAme Name of Application Date Save Apply 4. SEarch for you role 5.Run Security Wizard 6. Choose the Legal Entity 7. Grant Access to you Legal Entity ==================================== 8. Apply 9.Assign to the User Step 4: DEfine the Bank Accounts N: Setup > Payment > Bank Accounts Owner Access----Legal Entity Organization Access---Name of your OU ==================================================================== SETUPS RELATED TO PAYMENTS IN PAYABLES MODULE ------------------------------------------------ 1. Define Payment Documents Setup > Payment > Bank Accounts ======================================================================================================================== ENTER PAYMENTS =============== 1. N: Payments> Entry> Payments ======================================================================================== RECEIVABLES SET UPS ==================== 1. Enter Customers N :Customers> Customers DEfine Customers .......Account .......Site DEtails Save and add details to update Account information click Apply to update Customer Information 2. Defining the Transaction Types N: Setup> Transactions>Types -Invoices -DEbit Memo -Credit Memo -Chargeback Old Invoice-no.101 dt 15-08-10 for 50000 Amt recd on 28-10-10 ---40000 Closing the old invoice ================================== Chargeback to this invoice... Invoice No,205 dt 28-10-10 for 10000 ---2/10 Net 30 Apply Chargeback to an OPen Invoice COMMITMENT---- ---Deposit-----yOU rec advance ---Guarantee--receive a legal doc ================================================= WHILE DEFINING TRANSACTION TYPES START WITH THE CREDIT MEMO ========================================== 3. Defining the Memo Lines N: Setup>Transactions > Memo Lines 4. DEfining Auto CAsh Rule Set 5. DEfining Application Rule Sets N: Setup > Receipts > Application Rule Sets Invoice-21 ------- Line 1...............................1000 Line 2...............................7000 Line 3...............................8000 Line 4..............................4000 Total ...............................20000 Other Charges..........................3000 Freight.................................1000 Tax......................................1000 G Total..................................25000 Received -----22000 Auto Cash Rule SEt...............applied while choosing the Invoice App Rule Set......................applied at the time of partial receipt of amount and applied against components of the Invoices 6.Defining Receipt Classes N: Setup > Receipts > Receipt Classes DEfine REceipt classes Define REceipt Methods Link to Bank A/c Enter the Code combinations 7. DEfining Receivable Activities ----------------------------------------------------------------- BEFORE ENTERING TRANSACTIONS OPEN THE RECEIVABLES PERIODS N: Control > Accounting > Open/Close Periods 8. ENTERING TRANSACTIONS N: Transactions > Transactions 9. Enter Receipts N : Receipts > Receipts 1. N) Setup>Financials>Accounting Setup Manager>Accounting Setups 1. Define Legal Entity 2. Primary Ledger 3.Secondary Ledger 4.Accounting Options 5. Operating units 6. Sequencing Material-SEcondary Ledger Balancing Segment Value: 4 Legal Entities: LE1-------01-04 LE2-------10-20 LE3------30-40 LE4-----50-60 Balancing segment Values ===================================== Switch responsibility> Global HRMS (N): Workstructures> Organization> Description ======================================================================================================================= 2.Define GL REsponsibility 3. Assign to User 4.. Choose Profile Options 5. Open the 1st period (N): Setup > Open/ Close =========================================================================== TRANSACTIONS 1. Entering Journals: (N) : Journals>Enter ========================================= Finding Journals Journals>Enter> (B) Find =============================================== Posting Journals>Post Journals> Enter >(B) Post ====================================== Inquiry of Balances (N): Inquiry> Account ======================================= Roll up Groups: 1st Step: Define Parent and Child Values Example: Assets: Total Assets> Fixed Assets,Current Assets > REcei 2nd Step: DEfine the Roll up Groups Setup> Financials>Flexfields> Key> Groups 3rd Step: Linking the Parent values with the Groups ROLL UP GROUPS ARE USED TO CREATE THE SUMMARY ACCOUNTS ==================================================== SUMMARY ACCOUNTS: These are used to inquire the balances of parent values online. 1st step: (N): Setup > Accounts> Summary 2nd step: Make entries 3rd step: Inquiry> Account ============================================================= ACCOUNT ALIASES Short names for Account Code Combinations 01.000.1110-----> Cash 1----Cash of Company 1 01.350.4110------> Sales 1-Sales of company 1 Step 1: (N): Setup> Financials> Flexfields> Key> Aliases Enter the names and the details Step 2: Recompile Setup> Financials>Flexfields> Key> Segments Step 3: Entering Journals with Aliases ===================================================================== FOREIGN CURRENCY JOURNAL Defining Foreign Currencies: Corporate Daily Spot User
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