Manual
Posting setup and VAT
Nobody chooses a G/L account on a sales invoice. Posting finds the accounts itself, from posting groups: codes that customers, vendors, items, bank accounts and G/L accounts carry, and that the posting setups pair up with accounts.
The posting groups
| Posting group | Carried by | Says |
|---|---|---|
| Gen. Bus. Posting Group | Customers, vendors (and their documents) | Who the business deals with, such as DOMESTIC |
| Gen. Prod. Posting Group | Items, resources, G/L accounts (and document lines) | What is sold or bought, such as BREAD or INGREDIENT |
| VAT Bus. Posting Group | Customers, vendors | Their VAT position, such as DOMESTIC |
| VAT Prod. Posting Group | Items, resources, G/L accounts | The VAT rate of what is sold or bought, such as STANDARD or EXEMPT |
| Customer Posting Group | Customers | Their receivables account |
| Vendor Posting Group | Vendors | Their payables account |
| Bank Account Posting Group | Bank accounts | The bank’s G/L account |
| Inventory Posting Group | Items | Their inventory account, such as RAW or FINISHED |
Each has its own list under Posting Groups. A general business or product posting group can name a Default VAT Bus. Post. Grp or Default VAT Prod. Post. Grp.
The posting setups
| Setup | Pairs | Accounts |
|---|---|---|
| General Posting Setup | a Gen. Bus. Posting Group with a Gen. Prod. Posting Group | Sales GL Account, Purchases GL Account, COGS Account, Direct Cost Applied Account, Goods Received Not Invoiced Account |
| VAT Posting Setup | a VAT Bus. Posting Group with a VAT Prod. Posting Group | VAT Percentage, Sales VAT GL and the purchases VAT account |
| Inventory Posting Setup | a Location with an Inventory Posting Group | Inventory Account, Inventory Adjmt. Account |
| Customer Posting Groups | (the group alone) | Receivables Account |
| Vendor Posting Groups | (the group alone) | Payables Account No |
| Bank Account Posting Groups | (the group alone) | GL Account No |
So a sales line of white bread to Kisementi Fresh Market (DOMESTIC with BREAD) finds its sales account 210100 and its cost of goods sold 220100 on the DOMESTIC/BREAD line of General Posting Setup, its VAT rate and account on the DOMESTIC/STANDARD line of VAT Posting Setup, and the receivable on the DOMESTIC customer posting group: 110400. The Posting groups reference has every account each one decides.
Passion Bakery’s General Posting Setup:
| Gen. Bus. | Gen. Prod. | Sales GL Account | Purchases GL Account | COGS Account | Direct Cost Applied | Goods Received Not Invoiced |
|---|---|---|---|---|---|---|
| DOMESTIC | INGREDIENT | 210400 | 220200 | 220100 | 220200 | 120200 |
| DOMESTIC | BREAD | 210100 | 220200 | 220100 | 220200 | 120200 |
| DOMESTIC | PASTRY | 210200 | 220200 | 220110 | 220200 | 120200 |
| DOMESTIC | CAKE | 210300 | 220200 | 220120 | 220200 | 120200 |
| DOMESTIC | SERVICES | 210400 | 230600 | |||
| DOMESTIC | OVERHEADS | 210400 | 230600 |
When setup is missing
Posting stops when a pairing has no setup line, or the line has no account for what is posted, and says which. The Assistant offers in the Chat to set it up (Help me), proposing the accounts from the chart of accounts for you to confirm. The Setup Checklist also lists what the groups in use still need: a General, VAT or Inventory Posting Setup missing or without accounts, and customers, vendors, items and bank accounts without their posting groups.
VAT
Prices and journal amounts include VAT. When a line is posted, its VAT is split out at the VAT Percentage of its VAT business and product posting groups, and posted to the VAT account of VAT Posting Setup: the Sales VAT GL for sales, the purchases VAT account for purchases. A line of 5,900 at 18% is 5,000 plus 900 of VAT.
| VAT Bus. Posting Group | VAT Prod. Posting Group | VAT Percentage | VAT account |
|---|---|---|---|
| DOMESTIC | STANDARD | 18 | 120300 VAT Payable/Receivable |
| DOMESTIC | EXEMPT | 0 | 120300 VAT Payable/Receivable |
Each posting with VAT also writes VAT entries: the base, the VAT amount, and whether it was a sale or a purchase. Ask the Assistant for “the VAT return for last month” to have them added up, output VAT against input VAT.
Currencies
General Ledger Setup’s LCY Code is the local currency (UGX at the bakery). Other currencies are set up on Currencies; each Currency Card has its rounding and the accounts its realized and unrealized gains and losses post to, and Currency Exchange Rates holds the rates from each Starting Date. A customer, vendor or bank account in another currency has its Currency Code, and its documents are converted at the posting date’s rate. Adjust Exchange Rates (on Currencies) revalues open amounts in other currencies.
General Ledger Setup can also name an Additional Reporting Currency: G/L and VAT entries then keep their amounts in it too, and the reports can show them.