Introduction to FinancialForce Accounting

Transcription

1 Introduction to FinancialForce Accounting

2 Introduction to FinancialForce Accounting Table of Contents Course Overview Accounting Features... 2 Salesforce Objects... 2 Accounts... 3 Products... 3 Opportunities... 4 Company Independent Objects... 4 Chart of Accounts... 4 Dimensions... 5 Tax Codes... 6 Income Schedules... 6 Companies... 7 FinancialForce Accounting Company Dependent Objects... 8 Financial Years... 8 Currency... 8 Bank Accounts Input Documents and Transaction Lines Audit Transactions Input Documents Introduction to Input Documents Sales Invoice Sales Credit Note Payable Invoice Payable Credit Note Cash Entry Journal Cash Matching Journal Currency Revaluation Posting Input Documents GLOSSARY: All of the terms used throughout this document are outlined within the online help Introduction to FinancialForce Accounting

3 Course Overview 1 Course Overview This course is intended for new users of FinancialForce Accounting who need an overview of how the objects fit together and a foundation for understanding FinancialForce Accounting. This course provides an insight into the structure of the application and the way that data flows between objects and the key concepts that you must understand when deciding how FinancialForce Accounting is to be set up. This course is recommended for staff in your organization who use FinancialForce Accounting. We recommend that you have some knowledge of the Salesforce platform before attending this course. At the end of this course you will be able to: List the main features of FinancialForce Accounting Describe FinancialForce Accounting Concepts List the Salesforce objects used by FinancialForce Accounting Describe FinancialForce Accounting objects Describe FinancialForce Accounting input documents Describe the data required to set up FinancialForce Accounting Course Overview 1

4 2 At the end of this topic you will be able to: List the main features of FinancialForce Accounting List and describe the Salesforce objects used by FinancialForce Accounting Accounting Features FinancialForce Accounting includes all of the features that you would expect from a traditional accounting system such as: Accounts Receivable Accounts Payable Billing Budgeting and Reporting Currency Revaluation General Ledger Salesforce Objects FinancialForce Accounting uses the Salesforce platform to manage users, provide reports and allow you to set up workflows for your organization. An organization in the context of the Salesforce platform refers to a single installation of your Customer Relationship Management System. A Salesforce organization does not have to represent a single legal entity and can run across your entire business even when it comprises of several legal entities in different countries. These Salesforce objects are used by FinancialForce Accounting: Accounts Products Opportunities 2

5 3 Accounts Accounts are records of companies that you do business with: Products Products are records of the products that you sell: 3

6 4 Opportunities Opportunities contain information about a sale or pending deal that you can track: You can convert opportunities to sales invoices. Company Independent Objects A company independent object is one which does not just apply to one specific company. Examples of these include: Chart of Accounts Dimensions Tax Codes Income Schedules Chart of Accounts In FinancialForce Accounting, a chart of accounts is a collection of General Ledger Accounts (GLAs), entities and analysis dimensions, organized into a reporting structure. When setting up FinancialForce Accounting for the first time, you must build your chart of accounts. Field Name Reporting Code Type Trial Balance 1-4 Notes The Name should be prefixed with the reporting code to allow quick data entry. Unique code by which you can identify the GLA. Type of GLA such as Balance Sheet or Profit and Loss. This is the reporting hierarchy. Balance Sheet 1-3 This is the reporting hierarchy. 4

7 5 A reporting hierarchy is a means by which you can consolidate your general ledger accounts. You achieve this by placing each general ledger account into one or more user-defined hierarchical reporting structures. Here is a sample reporting hierarchy: Dimensions Analysis dimensions are an optional key performance indicator of your accounting codes. They also form part of a FinancialForce chart of accounts. Dimensions enable you to analyze the activity in your business in additional ways, such as by department, cost center, project, employee or any other aspect of business important to you. For example, you might want to analyze you data by: Department Sales, Marketing, General and Administrative departments and so on. Geographical area or region United States, Canada, Europe and so on. 5

8 6 You can define up to four custom dimensions for further analysis. For example: Analysis Dimension Sample Use Dimension 1 Dimension 2 Dimension 3 Dimension 4 Project Cost Centre Department Region Dimensions are normally used for profit and loss analysis. Tax Codes You must create a separate tax code for each different type of tax you want to record. In the UK, we recommend using the format: <CountryCode>-<I-Input or O-Output>-<Tax Type>. For instance: GB-I- STD. Each tax code should include the tax rate. We recommend prefixing the code with a country code because each company in your Salesforce organization can see all tax codes in your organization. For instance, GB-I-STD, where GB is the country code, I indicates an input tax code and STD, which indicates that this is the standard tax code for the country. For Sales and Use Tax (SUT) requirements in the United States of America, you would typically set up a code for each state, county and/or municipality you are required to collect taxes for. For example: TX State Ellis County TX Midlothian City TX You can apply a tax rate to a particular date range. For instance, if the tax rate changes, you can simply add a new tax rate to the tax code with a start date. Income Schedules An Income Schedule is used to spread the revenue from a sales invoice across a number of accounting periods. Each invoice or product line item can only have one income schedule. 6

9 7 Companies In FinancialForce Accounting, a company is a discrete self-balancing accounting unit within your organization. FinancialForce Accounting is a multi-company environment: Salesforce Organization Merlin Technologies, Inc Merlin Technologies S.A. Merlin Technologies Ltd You can create and report on more than one Company s Financial Data in a single Salesforce Organization. You use single company mode to enter data and you can use multi-company mode to generate reports that contain data from more than one company. 7

10 8 FinancialForce Accounting Company Dependent Objects A company dependent record is one which applies to a specific company. FinancialForce Accounting contains these company dependent objects: Financial Years Accounting Currency Bank Accounts Input Documents and Transaction Lines Audit Transactions Intercompany Definitions Financial Years Each financial year is divided into a number of periods for auditing and reporting purposes. When a document is created in FinancialForce Accounting, its accounting period is calculated from the document date or the period that falls within the date of input. Field Notes Year Name Must not have characters like / and must be four characters for instance, Enter a Year Name based on the end of the financial year For instance, if the financial year ends in 2014, the year is Number of Periods Period Calculation Basis Must have at least one trading period, but can have up to 90. The method that you want to use to calculate the interval between period end dates. The default is Month. Notes: Years and periods are in the format YYYY/PPP. Financial years must be in chronological order. You cannot change financial years once documents are posted. You must create a financial year for the earliest transaction Currency The currencies in which your FinancialForce Accounting company does business are called accounting currencies. An accounting currency: Must be an active currency on the Salesforce platform Only exists in the context of a company Must be set for each company in your organization FinancialForce Accounting uses its own solution for managing multiple currencies. This works alongside Salesforce s Currency Management Solution. The Administrator will specify a corporate currency. This is the Salesforce currency on which your corporate HQ reports revenue. 8

11 9 The Accounting Currency only exists within the context of a specific company therefore you must have a separate set of accounting currencies for every company on your org. Salesforce Organization Currency: USD Merlin Tech, Inc Merlin Tech S.A. Merlin Tech Ltd Home: USD Dual: USD Home: EUR Dual: USD Home: GBP Dual: USD Account: YEN Document: GBP The main working currency of a FinancialForce Accounting company is its home currency (also known as the financial reporting currency). This is the statutory currency that, tax returns are completed in. The currency in which your organization reports on a consolidated basis across all of your FinancialForce companies is its dual currency. This is for management accounting purposes, normally used for group reporting. Notes: You cannot post documents until you have designated both a home currency and a dual currency. Once documents are posted, you cannot change home and dual currency. Document currency is the currency in which you expect to be paid or will be paying in. Each account has a designated currency and each document posted can have a different currency to the account. For example, a French supplier wishing to be paid in Euros could send an invoice in Sterling to your company based in the US. 9

12 10 Home Currency x Exchange Rate = Document or Dual Currency When entering an Accounting Currency: Field Owner ISO Code Decimal Places Home Dual Notes The company to which the accounting currency relates. International Organization for Standardization currency code. The number of decimal places to which values in this currency are expressed Indicates whether the currency is the main working and reporting currency of the company. When selected, all documents and transactions for the company must balance in this currency. Indicates whether this currency is the currency in which your corporate headquarters reports. Each Accounting Currency can have dated exchange rates: Field Rate Start Date Notes Bank Accounts Exchange rates are applied to the Company to which the Accounting Currency relates as a multiplier of the home currency. Exchange rates can be applied to a particular date range. You must set up bank account records for each company before you can post cash received from a customer, post cash refunded to a customer or pay a vendor. 10

13 11 Field / Section Bank Account Name Reporting Code Bank Name Account Name Account Number Sort Code SWIFT Number IBAN Direct Debit Originator Reference Bank Account Currency Notes Short name for the bank account with an indication of its purpose. Alternative name or code used for reporting purposes. Full Name of the bank. Name of the account at the bank. Number of the bank account. Sort code of the bank account. 11-digit Society for World-wide Inter-bank Funds Transfer number for the account. Used when transferring money between banks. International Bank Account Number of the bank. Unique direct debit originator reference for this company bank account. ISO code of the accounting currency used by this company bank account. Bank Account Analysis You must select a general ledger account to which transactions related to this bank account will be posted. You can also choose up to four analysis dimensions 11

14 12 Field / Section Bank Charges Analysis Bank Interest Paid Analysis Bank Interest Received Analysis Notes Default general ledger account for recording bank charges. Must not be of type Retained Earnings You can also choose up to four analysis dimensions Default general ledger account for recording bank interest paid. Must not be of type Retained Earnings You can also choose up to four analysis dimensions Default general ledger account for recording bank interest received. Must not be of type Retained Earnings You can also choose up to four analysis dimensions Input Documents and Transaction Lines Input documents consist of a header that shows the line items of the document. The line items are contained in a separate object. Each line item relates to the header record to which it belongs. For instance, a Sales Invoice might contain many lines that represent products, which a customer has ordered. In progress documents, which are those that have not yet been committed to the accounting books. These can be edited or discarded. Posted documents have been committed to accounting books and their transaction records have been created. You can only edit certain fields on a posted document such as the Due Date. You can create Salesforce workflows that require a document to be approved before it is posted When a document is posted, Transaction and Transaction Line Items are created for that document. Several documents can be created in FinancialForce Accounting such as sales invoices, credit notes, cash entries and journals. Each document has a single header record which stores Accounts Products Opportunities information about the document and can have multiple record line items such as products on an invoice. Audit Transactions When posting a document such as a Sales Invoice, a transaction header with a set of transaction lines captures critical accounting information. 12

15 13 The Transaction Line Items represent the postings to the General Ledger Account and cannot be modified. 13

16 Input Documents 14 Input Documents At the end of this topic you will be able to: Describe FinancialForce Accounting Input Documents. Describe what happens when you post a sales invoice. Introduction to Input Documents FinancialForce Accounting has a number of possible input documents such as: Sales Invoice Sales Credit Note Payable Invoice Payable Credit Note Cash Entry Journal Cash Matching Journal (automatically generated) Currency Revaluation (automatically generated) Income Schedule Journals (automatically generated) Intercompany Journals (automatically generated) Sales Invoice A sales invoice is a commercial document that you issue to your customers to request payment for goods or services. Sales Credit Note A sales credit note is a document used to rectify errors made on a sales invoice which has been processed and sent to a customer. Credit notes might also be issued for: Returned Goods Damaged Goods Incorrect Shipment Overcharge Retrospective Discount Payable Invoice A payable invoice is your record of a sales invoice issued by a vendor to show evidence of the payable transaction for goods or services that your company has purchased. Input Documents 14

17 Input Documents 15 Payable Credit Note A payable credit note is your record of the sales credit note issued by a vendor to show evidence of a refund or discount. You can enter the information provided on your vendor's credit note including the products, quantities and prices paid for goods or services that have been returned or retrospectively discounted. Cash Entry A cash entry can be in a variety of forms, including cash, check or through some sort of electronic payment system and may be: Receipt a record of money received from a customer. Refund a record of money refunded to a customer. Payment a record of money paid to a vendor. Payment Refund a record of money refunded by a vendor. Journal A journal is a document that makes corrections or adjustments to your existing FinancialForce data. For instance: A product you have sold was linked to the wrong general ledger account. Create a journal that transfers the sales income from one sales revenue general ledger account and product combination (+) to the correct one ( ). One of your customers has been linked to the wrong general ledger account. Create a journal that transfers the debt from one accounts receivable general ledger account and account combination ( ) to the correct one (+). A cash entry has been posted to the wrong customer. Create a journal that transfers the value of the cash entry from one customer account (+) to the correct one ( ). A cash entry has been posted to the wrong bank account. Create a journal that transfers the value of the cash entry from one bank account ( ) to the correct one (+). One of your existing bank accounts has been linked to the wrong general ledger account. Create a journal that transfers the cash from one bank account and general ledger account combination ( ) to the correct one (+). You have a customer that has gone into liquidation with a bad debt. Create a journal that credits ( ) the customer account and debits (+) the bad debt write-offs general ledger account. An expense you incurred was posted to the wrong general ledger account. Create a journal that transfers the expense from one expenses general ledger account ( ) to the correct one (+). Cash Matching Journal Journals are also automatically generated when the matching process involves a settlement discount, write-off or currency write-off. These journals are called cash matching journals. Two cash matching journal lines are created for each transaction line against which the discount or write-off was entered one account line and one analysis line. In the case of a currency write-off, two journal line items are created for the sum of any positive currency write-offs, and two for the sum of any negative Input Documents 15

18 Input Documents 16 write-offs. All general ledger accounts and analysis dimensions are copied from the cash matching analysis details. Currency Revaluation There are two situations in which you might want to perform a currency revaluation: At period end. You might want to revalue your income statement to eliminate the effect of exchange rate fluctuations. At year end. You might want to revalue the company s balance sheet so that it values the assets and liabilities of the company at the exchange rate applicable on the balance sheet date. Posting Input Documents When an input document is posted, transaction line items are created: Some values are taken directly from the sales invoice and placed onto the transaction and some values are used to gather the correct general ledger account name from the chart of accounts. Many objects simply take one value such as the company and transfer it straight onto the transaction record. Other objects make use of the Chart of Accounts to find the general ledger accounts that relate to the chosen record. Input Documents 16