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| = INTRODUCTION TO BATCHING ENTRIES IN SOLACE ACCOUNTING =
| | #REDIRECT [[Accounting#Setting Up Journals and Entry Types]] |
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| Solace Accounting is a batch driven package that allows you to enter any transaction in batch mode. This gives the advantage of checking your entries before they are permanently saved to the database. In this module, we are exposing all the features to use the Entry Type screen which is simply the journal entry screen. All financial transactions will be entered in Solace Accounting or via journals so any transaction can be traced in journals reports. To process a Journal via '''Entry Type''' you need to:
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| Setup the journal Options
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| Enter the truncations line by lines. (“Capture” the data).
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| List or print the journal for hard copy archive and others.
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| Post the journal, (‘Save” the journal to Ledger).
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| = SETTING UP YOUR ENTRY TYPES =
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| The most used accounting principal is the double-entry concept which require for each debit transaction be an equal credit transaction and vice-versa. Solace Accounting is based in this double-entry concept and all journals are saved (posted) to the ledger with contra lines always. All the documents (invoice, purchase etc.) are posted with entry type batches in behind the scene.
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| Solace account will assist in writing the contra lines and so balancing the batch before posting to the ledger so only one side of the transaction is entered and using the journal settings solace will write the balancing lines and post a double-entry balanced batch to the ledger.
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| To Setup Normal journals
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| Normal Journal is also called non-cashbook journal in this document and in all other modules.
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| From the main screen click on '''Control Panel'''
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| Then on the control panel navigator double on '''Entry Types'''
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| The following screen should display
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| {| class="wikitable"
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| |-
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| ! Description
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| ! is the name of the actual entry type
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| | Cashbook
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| | will inform the type cashbook ,payment, receipt or non-cashbook
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| | Debit/Credit
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| | This is the default transaction type the will be captured with this journal. This can be changed in the actual entry type batch while entering transactions
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| | Account Access
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| | This option facilitates the quick filter in the lookup box and restricts accounting allowed in the journal.
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| | Contra per line
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| | This option will add an extra column in the entry screen to allow different contra account for each line. If the batch will use same contra line for each line then this should not be selected or ticked.
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| | Multi-Currency
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| | This option will allow non local currency to be used and this currency need to be define in the next entry box
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| | Bank account (Contra Account)
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| | This will set the default contra account used on each new line added. For cash book this filed is disabled as cashbook are auto created by solace on creating a bank account.
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| |}
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| To add a new journal, click on '''Add''' button then fill the details in the right panel. This panel is defining the default values most of them can be overridden in the actual entry screen
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| {| class="wikitable"
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| |-
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| ! Note: There is no need to create cashbook journal. By creating a bank account solace will automatically create the two cashbooks fore created bank account
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| |}
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| To create a cashbook Journal
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| As in the note, where creating an account with financial category as bank, solace will create the two cashbook journals, the payment journal and the receipt journal. The two crated journals are listed with the non-cashbook journal in the setup.
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| = ENTERING TRANSACTIONS IN A BATCH – ENTRY TYPE =
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| If you are not required to control stock items you will mostly use Entry types for all your transactions. Here are the details on how to record a sale with solace accounting.
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| To Enter a Transaction in a Journal
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| Ensure you have a '''Sales Account''' and the '''Customer Account '''if not check module “Setting up Accounts in Solace Accounting”
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| Ensure that you have a '''Sales Journal''' already defined if not create one and set as in the picture in up section.
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| From the main screen in the main menu click on '''General Ledger '''
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| In the navigator click on '''Journals '''in Process block
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| On entry type screen click in the lookup list and select S'''ales Journal''' then press the enter key to open a new journal
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| Now the top bar of the entry screen is enabled, then click on '''Settings''' button in the toolbar and this screen will be displayed
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| {| class="wikitable"
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| ! Contra Account
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| ! This is the same account as selection when creating the Journal and can be changed also here
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| | Consolidate Balances
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| | Tick this option to merge all similar transaction in one line and sum the amount in one total. The similarity is based on account code and Tax Type
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| | Invoke Open Item
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| | If you are matching all your invoices to the customer payment you should tick this option so the Open item Screen automatically open whenever there is more outstanding amount
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| | Multi-Currency
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| | Enable this to invoke currencies other than the local currency
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| | Link to Projects
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| | Enabling this will add extra column in the entry screen with a lookup to project list. This will help linking transaction to protect for project management.
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| | Increment Reference
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| | If this is ticked, Solace will increment the reference with 1 on each new line
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| | Repeat Details
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| | If ticked, Solace will repeat the line on every new line
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| | Repeat Project Code
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| | If ticked, Solace will repeat the project code on every new line. This not included the Repeat Details
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| | Process Tax
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| | By default, this is set to “Do not us Tax” and the journal will not process tax. Any other selection will add an extra column in the entry screen allowing selecting the Tax Type attached to the transaction in the line. “Default to Inclusive Mode” will cause, in the entry screen, the cursor to jump to the Inclusive Column first “Default to exclusive” will cause the cursor to jump the Exclusive Column first
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| | Default Tax Type
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| | Only enabled when the Process tax option is set to allow tax. This will be the default tax type on each new line but this can be overridden by the user.
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| |}
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| We can setup, for demo, the '''Sales Journal''' these are the settings can be as on the picture up here let enter this transaction
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| {| class="wikitable"
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| ! Reference
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| ! SAL00001
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| | Date
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| | 20/03/2016
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| | Description
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| | My First sale
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| | Tax
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| | Standard 14%
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| |-
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| | Amount
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| | 1250.00
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| |}
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| In the Entry screen, this will look like the following picture
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| This transaction is in temporary mode until posted the journal can be close and reopened still with same holding same lines entered details. This is batching, keeping open journals until check and verified before posting permanently to the ledger.
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| To post a journal
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| Solace accounting always with the contra lines automatically to balance the batch as solace is working on double-entry concept. The user should enter only one line of the transaction and using the settings, the contra account and the tax type, Solace will writer contra lines when and processes the journal on posting.
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| With the journal opened, click on '''Post''' button. The journal will post and the screen will close is the date and accounts selected are correct with Company settings.
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| The transaction is posted and many reports can be printed to reflect the balances of affected accounts
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| The Ledger report of the sales transaction we capture and now posted can pbe printed as follows:
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| Open the Report Manager screen from main menu '''Reports'''
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| Click on '''General Ledger '''button
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| In the navigator double click on '''Detailed Ledger '''button
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| Leave blank '''Include Financial Cat '''box and '''Include Account''' box
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| Select '''Period Start '''and''' Period End '''to include the transaction date we captured, 20/03/2016
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| Click '''Print'''
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| The report regenerated is as follows
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| Many other reports, can be printed but let show here the “'''Entry Type Batches'''” report, the “'''Trial Balance'''” Report and the “'''Tax”''' Report
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| Let note that posting a transaction with vat in non-cashbook will allocate amounts differently than posting in a cashbook. Cashbook transactions with vat will allocate to '''inclusive amount''' to the '''contra account''' and balance the transaction with the tax portion. But when using non-cashbook, the '''exclusive amount''' will be allocated to the '''contra account''' and the contra is balanced with the vat portion. For illustration let consider 2 situations with an inclusive amount of 114.
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| In the Petty Cash Payment journal, '''cashbook journal''', we enter a transaction of 114 in debit for stationaries with a standard vat type. The contra account is set to Petty Cash Account. Solace will allocate as follows
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| DrStationeries 100 * Entered line with amount re-adjusted
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| Dr Tax Control 14 * '''Generated balance line'''
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| Cr Petty Cash Account 114 * '''Generated balance line'''
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| In the Sales journal, a '''non-cashbook journal''', we enter a transaction of 114 in debit to a client with a standard vat type. The contra account is set to Sales Account. Solace will allocate as follows.
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| Dr Client 114 * Entered line with amount unchanged
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| Cr Tax Control 14 *''' Generated balance line'''
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| Cr Sales Account 100 * '''Generated balance line'''
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| {| class="wikitable"
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| ! Note: Solace Accounting auto-generate generate balancing lines differently in non-cashbook and cashbook journal. This is due to the portion of the vat amount on the contra account. So we recommend Petty Cash journal to be a cashbook type to post correctly the vat portion.
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| |}
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| = USING 100% VAT TYPE =
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| The most probing questions are
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| When I import goods from overseas, I am charged VAT on those goods. The company that handles the import for me sends out an invoice which is all VAT. How can I record this in solace accounting?
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| I just received a VAT only invoice from the supplier and this is related to invoices already invoiced goods and paid. This is similar to the Supplier rounding is different from what I recorded into Solace, How to I record the difference?
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| I am left on the Tax payable with a value that I am not compelled to remit the tax as it is below the limit. How do I record this adjustment so that is reflected on the Tax Report?
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| These 3 situations illustrate typical use of the 100% tax type. When using the 100% tax type, the full amount will be recorded to the Tax Control Account and the contra account will be recorded with the full balance. There many ways to record this with Solace Accounting but the most recommended techniques are presented here.
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| To Create 100% Tax Type
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| From the main screen on the left menu click on '''Control Panel'''
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| In the control Panel double click on '''Company Parameters '''under setup block
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| In the company parameters click on '''Tax Processing''' to get to the screen below
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| Enter in the list by typing Tax Adjustment and type 100 in the Rate% column
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| Click on Apply button
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| Check the image below. Then Check the report Tax Type listing to see all the record tax types in Solace Accounting.
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| To print the Tax Type List
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| From the main screen on the left menu click on '''Reports'''
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| In the report manager on the left menu click on '''Tax'''
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| In the right panel under Listings double click on '''Tax Types'''
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| Click print on the printing options the report will the as shown in this picture
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| To Journalize 100% vat
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| There are many ways of entering 100% but all are summarized in 3 methods
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| '''Method 1. Via the cash books journal'''
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| This suppose that the vat was not clamed at the moment of purchasing process. Ensure that your Entry type allows tax processing if not change the entry type settings as follows
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| Open the Cash Book Payment journal. (this is explained in other sections)
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| Click on '''Settings''' and change settings to include tax processing for that entry Type
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| Check the following picture
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| This will now add 2 extra columns to the entry type screen the '''Exclusive''' column and the '''Inclusive. '''For example let suppose that we entering 570 for imported goods and a full Vat of 8300. On the first line we will capture
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| First transaction
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| Dr Vat Control(input) at 100% 8 300
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| Cr Bank 8 300
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| Second transaction
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| Dr Supplier 570
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| Cr Bank 570
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| In solace cashbook journal enter:
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| first line of transaction by selecting any expense account for example '''Cost of Sales''' account and selecting the tax type 100% and enter the debit amount of 8 300
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| the second line select the supplier account with not tax type and enter the debit of 570
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| post the entry type and check the report as shown on this picture
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| {| class="wikitable"
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| |-
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| ! Note: Only the Dr (Debit) lines are entered and when posting the Cr (Credit) lines will automatically be generated. Also notice that with 100% tax type, the exclusive and inclusive amounts will always be the same value on the entry screen.
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| |}
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| '''Method 2. Via Purchase Journal'''
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| Capturing transactions with cashbooks is different from other journal in the sense that cashbook contra account is always the bank account but in other journal the contra account is selectable by the user. For the 100% Vat transaction, in the cashbook, the expense account will be “replaced” with the Tax Control account meaning not amount will be posted the expense account. But in other journals as the Purchase Journal, the contra account is the expense account like the '''Cost of Sales''' account. The Contra account must be the expense account for the 100% transaction to be recorded correctly. The transactions to enter are as follows:
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| Cr Supplier with 100% Tax 8 300
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| Cr Same Supplier no tax 570
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| The first line of transaction is entered by selecting the supplier account and selecting the 100% tax type and entering the credit amount of 8 300
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| The second line of transaction is entered by selecting the
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| {| class="wikitable"
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| ! Note: Only the Cr (Credit) lines are entered and when posted the Dr (Debit) lines will automatically be generated.
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| |}
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| The entry screen will be as the following:
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| After posting the resulting report is as follows:
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| '''Method3. Via Purchase Document'''
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| Solace Accounting allows to enter a GL (general ledger) Account directly into document lines and this can be used to adjust Vat on goods purchased, more especially when capturing supplier invoices. This method is preferable when supplied goods need to be recorded to the inventory the stock quantities are controlled.
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| In the supplier Invoice entry screen the '''Cost of Sales''' account will be used in the document lines to record the 8300 to the tax control account. The 570 will be recorded via a stock item that is being purchased.
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| The tax adjustment line will be entered by selecting the line type '''4 GL Account''' and selecting the cost of sales account in the account lookup then selecting 100% tax type and entering 8300 in the price column. The quantity can be set to 1.
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| The good purchased line is a normal stock item line but with no VAT
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| The Supplier invoice (Purchase Document) entry screen will be as follows:
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| After posting this purchase document the resulting report will be:
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| = USING REPEATING ENTRIES =
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| Solace Accounting has a “repeating entries” option that will allow the user to enter transactions that are recurring on aperiodic basic. Capturing these transactions has no particularity than the normal transaction entry except that entry screen will display '''Recurring Batch'''.
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| To open normal Recurring Journal
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| From Main screen click on '''General Ledger''' in the main menu
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| In the navigator, double click on '''Recurring Journals''' button
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| Select the entry type in the '''Entry Type''' list
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| Press the '''Enter''' key to access the batch lines.
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| Following should be as the following picture and not the title “Recurring batch” on the screen.
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| To Copy the Recurring Journal
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| Open the normal journal and reach the journal lines to activate the toolbar.
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| From the journal toolbar click on '''Process''' button
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| In the popup menu select and click on '''Copy Recurring. '''An assistant will display and will guide through the process. Read and follow the assistant instructions.
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| The original recurring batch will be kept in place after the process and can be reused after for next period.
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| = USING ABBREVIATIONS =
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| Solace Accounting has an auto description fill facility that will help the user same time in typing description. In the case of long or repeating description or word an abbreviation can be define and whenever it is entered in a description box, Solace will autocratically replace with the associated word or description
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| To create abbreviations
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| From Main screen click on '''General Ledger''' in the main menu
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| In the navigator, double click on '''Recurring Journals''' button
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| Double click on '''Abbreviations''' in '''General Maintenance''' block of the navigator. A simple screen will be displayed with only to entry boxes. The first is the actual code of the abbreviation and the second is the text that will be used to replace the code.
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| Click on '''New'''
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| Enter the abbreviation in '''Code''' entry box
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| Press '''Enter''' key
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| Enter the description or full word in '''Description''' entry box
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| Click '''Save''' button
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| For example the abbreviation '''“'''P'''” '''will be used to type the description “Payment thank you” as in the following picture
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| {| class="wikitable"
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| ! Note: The Abbreviation are case sensitive so a ‘P’ is different that “p”. Abbreviation can be up to 3 characters long
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| |}
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| To use the Abbreviation
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| The abbreviation code can be used mostly in journals and documents in the description field. So, from inside the journal move to description column and
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| Enter the abbreviation code in the description column. For example, just the capital P
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| Press '''Enter''' key and the “p” will be replace by “Payment thank you” as in the following journal.
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| = ENTERING OPENING BALANCES =
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| If your company is not a brand-new business and has not been trading, you can skip this step. The opening balances are obtained from previous financial year in a form of trial balance or balance sheet report from another system. Before using Solace Accounting system, these figures must be entered using the “General Journal”. It is also advised to enter these figures one days before the start day of the current year, by this, all expenses will be reported to the retained income account at the beginning of the current financial year. All the suppliers and customers figures must be entered to individual accounts.
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| For this tutorial, we have this closing trial balance.
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| General ledger settings
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| Ensure that the contra account is set to your suspense account and all other settings are left as on the image below.
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| {| class="wikitable"
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| |-
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| ! Note: Solace Accounting doesn’t allow posting directly to retained income. For entering opening balance to Retained income, any income expense must be used to let the system transfer the figure to next year as opening balance.
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| |}
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| Enter the trial balance as the below image and post
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| From this screen, we can list the journal list before posting to the ledger
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| When posted all type of report can be listed, here we show the trial balance and the balance sheet
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| = WHERE FROM HERE =
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| More details on journal process can be found in other modules or on the wiki page accessible from the main screen in solace Accounting.
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