Frequently Asked Questions - Accounting

If you are making journal entries across different companies, you are now forced to keep each company in balance and make your entries happen with standard inter-company accounting procedures. For each company you would create matching Due To/From accounts on the balance sheet. There are lots of ways to set this up but here is a quick example:

Lets assume you are only using the company segment and the account number

Company 01 would need an asset account - 01-1501 Due To/From Company 02
Company 02 would need an asset account - 02-1501 Due To/From Company 01

Now instead of one journal entry you make two, one journal entry per company. Say, for example, we posted some G&A expense to company 01 and need to move it to company 02.

Credit 01-6500 $500
Debit 01-1501 $500

Credit 02-1501 $500
Debit 02-6500 $500

If our inter-company (Due to/from) account started at $0 we would now see a $500 balance in the account for company 01 and a ($500) balance for company 02.

The inter-company account(s) must remain in balance at all times, no exceptions. Any entry made to an inter-company account requires that a corresponding entry be made to the other inter-company account immediately. Any individual using inter-company account must know that they are not allowed to leave their desk if the inter-company accounts are out of balance, no exceptions. Inter-company accounts can really get out of control if people are not careful.

You can use either a Misc. A/R Credit Memo or a Sales Order Credit Memo to issue tax credits to your customers. The following example describes how to do this using the Misc. Credit Memo (although, the steps are very similar for Sales Order Credit Memos):

Example:

1. You need to credit Customer ABC for $25 tax
2. Open Misc. Credit Memo screen
3. Enter $25 in "Amount" field
4. Open "Tax" link
5. Create a new Tax Adjustment for $25
6. Post Credit Memo
7. View credit in Tax History report
8. Later: Apply Credit Memo to Customer open item

Yes, beginning with xTuple ERP version 3.3.0 we added the ability to reverse (i.e., void) Cash Receipts from the Cash Receipts report screen, found under Accounting > Accounts Receivable > Reports > Cash Receipts. When you reverse a Cash Receipt, you also undo any applications made originally when the cash was applied.

After a Cash Receipt has been reversed, it returns to an unposted state. That means you can then make any changes to the unposted document before you post it again.

Keep in mind, this works only for Cash Receipts entered in or after xTuple ERP version 3.3.0. Cash Receipts entered prior to 3.3.0 cannot be voided in this way. Also, any Credit Memos or Customer Deposits created from the unapplied balance when the original Cash Receipt was posted will not be reversed when a Cash Receipt is voided. Instead, a misc. A/R Debit Memo will be created in the amount of the original unapplied balance.

One possible explanation for this is that the Basic Balance Sheet which ships with xTuple ERP is YTD. Therefore, the only way to balance it against the Basic Income Statement is to view the Income Statement as YTD, as well.

It's also possible you've customized your financial reports, and the profit calculations in each report definition don't match.

We recommend entering G/L Chart of Account opening balances using one of two possible methods described in the document Entering Opening Balances.

The process of closing Accounting Periods and Fiscal Years requires an understanding of several xTuple ERP configuration options. This topic is covered fully in the Closing Procedures document.

In that document you will look at General Ledger (G/L) Account Number settings and how they relate to Accounting Periods that are open and/or frozen. Next, you will see two scenarios based on different configurations of these settings. Finally, you will see important issues to consider before closing Accounting Periods and Fiscal Years.

Forward-updating carries the ending balance for an Accounting Period forward to the beginning balance of the next Accounting Period, continuing the process until the current Accounting Period is reached. Keep in mind that balances cannot be forward-updated into Periods that are in the future relative to the current Period.

Forwarding trial balances is discussed in the Closing Procedures document.