General ledger settings

Menu path

System ➔ General ➔ Settings ➔ General ledger settings

Introduction

Before you start to record financial entries in , you need to set the general ledger settings.

What version are you using?

The information in this document is applicable to product update 501 and higher. If you have versions lower than this, certain features explained here will not be applicable.

How do I define the general ledger settings?

1. In the General ledger settings screen, define the relevant fields.
2. Click Save.
3. A message “Changes will take effect after restarting the software” will be displayed.
4. Click OK.
5. Restart Exact Globe Next.

Keep in mind: All fields with the “!” icon are mandatory.

How do I edit the general ledger settings?

1. In the General ledger settings screen, make the required changes.
2. Click Save.
3. A message “Changes will take effect after restarting the software” will be displayed.
4. Click OK.
5. Restart Exact Globe Next.

How do I view the changes made to the settings?

1. In the General ledger settings screen, click Logbook.
2. The list of changes made to the settings will be displayed.
3. Click Close to exit.

VAT section

Disable VAT

Select this check box if you do not want to use value-added tax (VAT) in your administration. However, this function will not be enabled if a transaction involving VAT has been recorded.

Flexible VAT system

Select this check box if you want to use a flexible VAT system, which allows you to use the VAT invoice system, as well as the VAT cash system when declaring VAT. If you have selected this check box, you can define a VAT code to be based on the VAT cash system when creating or maintaining a VAT code. For more information, see Creating and maintaining tax codes.

VAT type

Select the VAT type that you want to use in your VAT overview. You can select Invoice system if you want the VAT overview to be based on the invoice system. This means you declare the VAT based on entries made in purchase and sales invoices at a certain period. Alternatively, you can select Cash system if you want the VAT overview to be based on the cash system. This means you declare the VAT when payment is registered for the sales invoice.

Note: If you have selected the Flexible VAT system checkbox, VAT type will be disabled and set to Invoice system.

Use separate GL to close VAT balances

Select this check box to use a separate general ledger account to balance off the VAT to pay and VAT to claim general ledger accounts. During the final VAT return, the balance of this general ledger account will be booked to the tax creditor general ledger account.

GL to report VAT

Type or select the general ledger account that will be used to balance off the VAT to pay and VAT to claim general ledger accounts.

Note: This field will only be enabled once you have selected the Use separate GL to close VAT balances check box.

Non-deductible VAT

Select this check box to enable the non-deductible VAT functionality for purchase journal entries. Non-deductible VAT refers to the VAT amount which you cannot claim from the tax authority.

Note: The non-deductible VAT functionality is also supported for multiple taxes if you have selected the Use tax module and Non-deductible VAT check boxes. In this scenario, the system supports the non-deductible VAT for the first tax code only in the purchase journal entry.

Entry section

Print posting report immediately

Select this check box to immediately print the posting report during the processing.

Unique GL per bank/cash journal

Select this check box to have a unique link of one general ledger account to one bank or cash journal. If this function is enabled, you will not be allowed to use a general ledger account, which is already linked to another journal, for linking to the new bank or cash journal that you want to create.

Entry number/reporting date link

Select this check box if you want the entry number to be based on the reporting date. This setup applies to all the journal transactions. For example, your company received a purchase invoice dated December 23, 2011 and you recorded the invoice on January 16, 2012. The date at Date in the purchase journal will be the entry date, which is December 23, 2011 and the reporting date at Reporting date will be January 16, 2012. Once you select the Entry number/ reporting date link check box, the system will assign the entry number based on the January 16, 2012 reporting date.

Check Analytical values

Select the option whether to check the analytical values during the entry level or the processing level. If you select Entry, analytical values will be checked during the journal entry and XML import. However, if you select Processing, analytical values will be checked during the final processing of the entry at Finance > Entries > Process.

Note: Go to Finance > General ledger > Chart of GL’s and open a general ledger account. In the Maintain accounts screen in the Advanced mode, you can select the check boxes under the Analytical Required section to define the analytical values to be checked. Based on this setting, the system will check the analytical required values selected in the Analytical Required section.

Year-end closing process section

Process balance sheet

Select this check box if you want to implement the year-end closing process for the balance sheet general ledger accounts.

Closing offset B/S account

Type or select the general ledger account that will be used as the closing balance offset general ledger account. If the Opening offset B/S account is not defined, the general ledger account defined at this field will be used as the closing and opening balance offset general ledger account.

Note: This field will only be enabled once you have selected the Process balance sheet check box.

Opening offset B/S account

Type or select the general ledger account that will be used as the opening balance offset general ledger account. If this field is not defined, the general ledger account defined at Closing offset B/S account will be used.

Note: This field will only be enabled once you have selected the Process balance sheet check box.

Result

Type or select the general ledger account used to record the profit or loss process results.

General ledger section

Payment differences

Click Details to go to the Details screen to type or select the general ledger accounts used to record discounts, payment differences, credit surcharge, and financial charges. The Discount, Payment differences, Credit surcharge, and Financial charge sections will be displayed:

Calculation differences

Click Details to go to the Details screen to type or select the general ledger account used to record calculation differences. For example, the calculation difference between the invoice amount and the received or paid amount due to the use of a different currency. The Calculation differences field, Use first line GL check box and Rounding difference on A/R and A/P GLs check box will be displayed:

Accruals and prepayments

Type or select the general ledger account used to record accruals and prepayments.

Euro calc dif (Debit)

Type or select the general ledger account used to record calculation differences due to the use of the Euro and another currency. For example, you record an entry in Euro but payment is made using Guilders or vice versa. This difference must be recorded in this general ledger account.

Invoices / items to be received

Type or select the general ledger account used to record invoices or items to be received. This general ledger account is an intermediate account used before you actually receive the invoices or items.

Suspense account : Logistics

Type or select the general ledger account used to record entries related to interbranch transfers in warehouse management.

Service: Time and material

Type or select a general ledger account for the time and material cost for the service orders. If this field is not defined, the value selected at the Cost of goods sold field in the Items screen will be used in the journal entry. For more information, see Creating and maintaining items – Financial tab. However, if you have selected a value for this field, the journal entry will use this defined value for the service order.

Service: Contract costs

Type or select a general ledger account for the contract cost for the service orders.

Service: Warranty costs

Type or select a general ledger account for the warranty cost for the service orders.

Landed costs

Type or select the general ledger account used to record the allocation of landed costs.

Net result: Profit & Loss

Type or select the general ledger account used to record the profit/loss process results. When filled, this will enable the Associated Accounts functionality. For more information, see Multi-level Year End Closing Process Functionality.

Bank costs

Type or select the general ledger account used to record the banking fees.

Production : Costs

Type or select the general ledger account used to record the production costs such as the material costs and machine hours incurred to complete a production order.

Production : Revenue

Type or select the general ledger account used to record the production revenue upon the production order receipt.

Production : Waste

Type or select the general ledger account to record the costs due to waste generated from the production. For example, waste could be a piece of unwanted wood cut out from a table, which is the end product.

Production : Results

Type or select the general ledger account used to record the balancing results of the Production : Costs account, Production : Revenue account, and Production : Waste account when a production order is completed.

Production : WIP

Type or select the general ledger account used to record the production costs and revenue during the production process. Once a production order is completed, the costs and revenue from this account will be transferred to the Production : Costs and Production : Revenue accounts, respectively.

Production : Scrap

Type or select the general ledger account used to record the production scrap. Scrap is waste material that is not planned in production order.

Journal section

Sales invoice

Type or select the journal which is used to record the financial entries when you print the sales invoices with the E-Order or E-Invoice module.

Cash journal (POS/Direct invoices)

Type or select the journal which is used to record the financial entries when you print the POS or direct invoices with the E-POS or E-Invoice module.

Item transactions

Type or select the journal which is used to record item transactions.

Project (Realizations)

Type or select the journal used to record the financial entries related to project realization.

Depreciation

Type or select the journal which is used to record the assets depreciation.

Work in progress

Type or select the journal which is used to record the financial entries when you generate work in progress amounts for a project.

Default section

Tax & Discount calculation

Select the option to calculate tax and discount. There are three options available:

• Tax calculated over net invoice amount excluding discount — Select this option if you want to calculate tax over the net invoice amount before deducting the discount. The discount amount will be calculated based on the total invoice amount (net amount + calculated tax). See the following example:

Net amount: EUR 100

Tax: 19 % (Including)

Payment condition: 2% discount for payment within 10 days.

Calculated tax: EUR 19

Total amount: EUR 119

Calculated discount (if payment is made within 10 days): 2% * EUR 119 = EUR 2.38

• Tax calculated over net invoice amount including discount — Select this option if you want to calculate tax over the net invoice amount after deducting the discount. The discount amount is then calculated based on the net amount of invoice. See the following example:

Net amount: EUR 100

Tax: 19 % (including)

Payment condition: 2 % discount for payment within 10 days.

Calculated discount (if payment is made within 10 days): EUR 2

Net amount after discount: EUR 100 – EUR 2 = EUR 98

Calculated tax: EUR 98 * 19 % = EUR 18.62

Total amount: EUR 100 + EUR 18.62 = EUR 118.62

• Tax calculated over gross invoice amount — Select this option if you want to calculate the tax and discount amount based on the gross invoice amount. See the following example:

Net amount: EUR 100

Tax: 19 % (including)

Payment condition: 2 % discount for payment within 10 days.

Calculated tax: 100 * 19 % = EUR 19

Total amount: EUR 100 + EUR 19 = EUR 119

Calculated Discount Term: 100 * 2 % = 2 EUR

Note: The Tax calculated over gross invoice amount option is available only in the single tax environment. Hence, if the Use tax module check box is selected, this option will not be available.

Cost centre allocation method

Select the cost center allocation method to be used. There are two options available:

Allocate using general ledger accounts from upper level cost center — Select this option to use the reallocated expense and coverage general ledger accounts defined for the upper level cost center in cost center allocation.

Allocate using general ledger accounts from lower level cost center — Select this option to use the reallocated expense and coverage general ledger accounts defined for the lower level cost center in cost center allocation.

Payment condition: Debtor

Select the default payment condition for debtors. Click Debtors to change the payment condition for the selected debtor(s).

Payment condition: Creditor

Select the default payment condition for creditors. Click Creditors to change the payment condition for the selected creditor(s).

Ageing section

Debtor

Type the days for the three categories that you want to use in your ageing analysis of the outstanding amount owed by your debtors. This setting is used to generate the ageing analysis overview at Finance > Accounts receivable > Receivables > Ageing analysis, Finance > Accounts receivable > Receivables > Receivables, and Finance > Accounts receivable > Cards.

Creditor

Type the days for the three categories that you want to use in your ageing analysis of the outstanding amounts that you owe to your creditors. This setting is used to generate the ageing analysis overview at Finance > Accounts payable > Payables > Ageing analysis, Finance > Accounts payable > Payables > Payables, and Finance > Accounts payable > Cards.

General section

Allocate screen: Advanced mode

Select this check box if you want to go to the Allocate screen in the Advanced mode during entries in the bank or cash journals via Finance > Entries > Bank/Cash or cash flow in Cash flow > Entries > Cash flow. By default, this check box is not selected. This means the Allocate screen will be displayed in the Simple mode.

Invoices / items to be received per item

Select this check box if you want to use different invoices or items to be received general ledger accounts for different items or item groups. By default, the check box is not selected, which means, either the invoices or items to be received general ledger account will be used for all the items and item groups.

Note: This setting is available only if you have the E-Purchase module.

Matching: Cash flow section

Overwrite Offset account

Select the option to define how your administration is going to handle the offset account when there is a mismatch in the debtor or creditor accounts, receipt or payment, and invoices. There are three available options:

• Never — Select this option to never overwrite the offset account.
• Always — Select this option to always overwrite the offset account even if the mismatching is found in a closed period.
• Only in open periods — Select this option to overwrite the offset account only if mismatching is found in open periods.

Retain statement analytical values

Select this check box to retain the original analytical values of bank or cash entries after matching.

Note: During the matching of single invoices, the analytical values for project, cost center, and cost unit will be copied to the new entry line of the bank or cash journal from the related invoice regardless the selection of this.

Create offset entry

Select this check box to allow the system to create offset entry lines during the matching process when the entries are matched using different creditor or debtor accounts. When this setting is defined, the original general ledger account will not be overwritten but an offset entry line will be created.

Note: This setting will be enabled only if Never is selected at Overwrite Offset account.

Date: Offset entry

Select the Current date or Last transaction date option. If Current date is chosen, then the offset entries will be generated based on the current system date of the invoices, payments, or receipts. If you choose Last transaction date, then the offset entries will be generated based on the last transaction date of the invoices, payments or receipts. The corresponding reporting date from the last transaction date will be copied over to the offset entry.

Matching: Invoices section

Create offset entry

Select this check box to allow the system to create offset entry lines during the matching process when invoices and/or credit notes are matched using different general ledger accounts.

Date: Offset entry

Select the Current date or Last transaction date option. If Current date is chosen, then the offset entries will be generated based on the current system date of the invoices, payments, or receipts. If you choose Last transaction date, then the offset entries will be generated based on the last transaction date of the invoices, payments or receipts. The corresponding reporting date from the last transaction date will be copied over to the offset entry.

Note: The Date: Offset entry setting will be enabled only if Never is selected at Overwrite Offset account under the Matching: Cash flow section and the Create offset entry check box is selected under the Matching: Invoices section. For closed periods, the offset entry is created on the first day of the next available open financial period.

Logbook

Click this to view all the information of the changes you have made in the settings.

Save

Click this to save all the changes you have made in General ledger settings.

Close

Click this to exit.

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