Evaluation carried out by: John Oates Baker Tilly Tax & Advisory Services LLP

Transcription

1 ICAEW Accredited IT Products Scheme Financial Software Accreditation Evaluation carried out by: John Oates Baker Tilly Tax & Advisory Services LLP Date completed: May 2007 The Institute of Chartered Accountants in England and Wales has accredited Mamut Office under the terms of the ICAEW Accreditation Scheme. Purchasers should ensure that the software, its security features and related support meet their own specific requirements, as the Institute will not be liable for any damage whatsoever, incurred by any person, occasioned by the use of the software, or any related products or services howsoever caused.

2 1. Summary 1.1 Introduction The suitability of accounting software for each particular user will always be dependent upon that user's individual requirements. These requirements should therefore always be fully considered before software is acquired. The quality of the software developers or suppliers should also be considered at the onset. Fundamentally good accounting software should: be capable of supporting the accounting functions for which it was designed. provide facilities to ensure the completeness, accuracy and continued integrity of these accounting functions. be effectively supported and maintained. It is also desirable that good accounting software should: be easy to learn, understand and operate. make best practical use of available resources. accommodate limited changes to reflect specific user requirements. It is essential, when software is implemented, for appropriate support and training to be available. 1.2 Approach, including work performed version 9.1 was accredited in July Following the release of versions 10.2 and 11.1 Mamut updated the questionnaire in areas where new functionality had been introduced. The evaluator tested operation of the parts of the system in which new functionality had been introduced and confirmed that all changes to the questionnaire were appropriate. The portfolio consists of the products Professional (which has the greatest level of functionality) and Standard and Start with reduced functionality for customers that do not required certain features

3 In order to assist in the evaluation and accreditation of, Mamut completed the detailed questionnaire. The supplier s responses reflect the functionality of Mamut Office Professional and a column exists for each of the three Office products to indicate areas where the functionality differs between the products. The evaluator tested operation of Professional using the example company database that is provided with the product and discussed various aspects of the system with representatives of Mamut to confirm the validity of the supplier s responses. The questions were individually reviewed and the majority of assessments were confirmed. The evaluator then performed sample testing of Office Standard and Office Start to confirm that where relevant the supplier s response was also valid for these products and that the functionality indicated by the respective columns is accurate. 1.3 Software & Hardware Used versions 9.1, 10.2 & 11.1 were evaluated on a standalone PC with a Pentium IV 2.4GHz processor and 512MB RAM under Windows XP Professional SP Suitability for User Mamut software is aimed at organisations with 1 50 employees and 1 25 simultaneous users, although supports only a single concurrent user. Users are spread over a wide range of business sectors, including wholesale, retail, manufacturing, service, professional, and the voluntary sector. The majority of Mamut s customers have 1 to 10 users, a significant proportion of which are single user. Mamut s customers include a wide range of companies in addition to sole traders, voluntary organisations, clubs and societies. Many such organisations are characterised by a lack of deep accounting, business process and IT expertise. Mamut s approach to the application itself and the support services means that the user receives a simple and seamless product with all of the functionality listed being available in a single product offering. Customers considering Mamut software products should consider which features they will require in order to select the most appropriate product for their requirements. A chart providing a comparison of the key features that are available in each of the products is available from Mamut

4 1.5 Evaluation conclusion There were no areas of concern. is a strong and user-friendly accounting system aimed at organisations that only require a single concurrent user of the accounting system. The software is supported by the supplier. In terms of the functionality that is available in the current version and the target market for this software, the product has been adequately specified and is easy to use. 2. Matters to Consider before Purchasing 2.1 Minimum Hardware Requirements PC with minimum 233 MHz processor, 64 MB RAM (or higher), Microsoft Windows XP/2000/NT/Me/98. Microsoft Internet Explorer 5.0 (or higher) and 100 MB free hard disk space. 2.2 Supplier Background Mamut ASA was incorporated in Norway in 1994 under the name Guru Software AS with an objective of making the everyday operations of small businesses simpler and more efficient. It concentrated on the development of administration systems designed for small businesses adopting highly competitive pricing to achieve volume sales. Ten years later the company is listed on the Oslo Stock Exchange, has more than 180 employees, operates in Norway, Sweden, The Netherlands, and the UK, and claims more than 90,000 users of its software products. Mamut is now well established as the market leader for the supply of all-inclusive accounting, administration, e-commerce and CRM systems to small businesses in Norway. Having entered the Swedish market in 2002, the company claims to have become the third place supplier in its sector in just 18 months. The company entered the Dutch and British markets in 2004, establishing 2,000 customers in the first nine months. An important factor in the company s development has been a close collaboration with Microsoft. From the beginning its product development has been entirely focused on - 3 -

5 Microsoft 32 bit platform technology. This has enabled the company to develop an easy to use, functionally rich application, closely integrated with Microsoft Office, at an extremely competitive price point. This cooperation was further cemented in respect of Mamut Business Software, with the announcement of further close cooperation between Microsoft and Mamut for the provision of all-inclusive business applications and services to meet the entire needs of small businesses under the banner of Small Business Concierge. More information on the company can be found at Product Background The Mamut software portfolio offers groups of all-inclusive business applications providing seamless integration between web shopping, CRM and accounting. Mamut combines the functionality for: Accounting and financial management (general, sales and purchase ledgers, budgeting, VAT, reports) Sales management (quotations, orders, invoices, budgets) Product management (purchase orders, stock control, bills of materials, serial numbers, stock costing) Project management (project costing, time sheet entry, project billing) HR (employee register, time sheets, payroll) Customer Relationship Management (with close integration to Microsoft Office) e-commerce (web site generator, web shopping, hosted by Mamut) 300 standard reports, plus report generator Multi-currency (with automatic exchange variance accounting) Interactive Getting Started self-training guide - 4 -

6 This product accreditation covers core financials, sales management, product management and multi-currency processing. Project management, HR, CRM and e- commerce are outside the scope of the accreditation scheme for financial products but they are referred to here for completeness. Mamut features a familiar Windows user interface, with easy navigation tools, and readily accessible online help. Users can opt to select from a number of Views which tailor the screen layout according to the workflow of particular job functions, these include: e- commerce, Contact Management, Sales Automation, Human Resources, Logistics, Accounting, Executive, Administrator and self-defined. Ease of use is further enhanced by comprehensive help and an interactive self training guide. The system is installed with a pre-set chart of accounts, VAT table, default analysis codes, etc, so that the novice user can start productive work quickly and easily. The company is also introducing a Mamut Academy to the UK, matching the low cost classroom style training provided in other markets. Relationships with Accounting Firms and Consultants have also been established to provide professional assistance when needed. For a system aimed at small users the system offers considerable depth of functionality. An example of this is the way each function provides easy access to related data. For example in the CRM part of the system, the screen display for viewing a Company provides a display window for additional data in the lower portion of the screen; data in this portion is selected by tabs and includes: Contact person(s), Activities (including automatically linked s from Outlook), Documents (from Microsoft Office), Sales Invoicing, Quotations, Accounting, Projects, Other Information (general company information) and Settings (payment terms, etc). Key functions, such as the generation of a sales order or invoice, can be launched from this same screen. A similar level of comprehensive display in simple workflow friendly formats is apparent throughout the system. The integration with Microsoft Office is transparent. By entering the contact s address in the Contact Record s to that address via Outlook automatically copy into the Contact s Activity folder. Microsoft Office Documents from Word, Excel, PowerPoint and Project can be launched from templates held in Mamut, or simply copied across into - 5 -

7 the Mamut folder. Mail merges and mass s can be generated from within Mamut using Mamut s parameters to filter lists. Mamut also offers Mamut Enterprise with additional functionality and Mamut Accounting with reduced functionality compared to for customers with more or less complex requirements respectively and these products are covered by separate questionnaires. A free 15 day evaluation copy of all Mamut software products can be downloaded from Product Support A full support service (includes maintenance upgrades, on-line support, telephone support, and a user community web site featuring Mamut Information Desk and mysite) is provided under a monthly fee arrangement. Mamut sells and provides support for its products direct to end users but a recent initiative may, over time, result in a UK network of value added resellers. 2.5 Limitations The ICAEW software accreditation scheme has been developed to cover a wide range of software. The following limitations should therefore be considered in context with the potential market for this product, for which in many cases they may not be applicable. only supports a single concurrent user. Multi-user installations are supported by Mamut Enterprise and Mamut Accounting. The software does not provide a report showing changes to master files or standing data. The current version does not provide automatic calculation of early settlement discount. INTRASTAT reporting is not supported in but is available in Mamut Enterprise E5 if required. The current release includes simple budgeting functionality and variance analysis but this does not provide automatic exception reporting. More sophisticated budgeting is planned for a future release

8 Age analysis of stock is not supported in but is available in Mamut Enterprise if required. The system does not support printing of cheques although this is planned for a future release. It is not possible to define ledger accounts to take invoices/payments in specified currencies or multiple currencies but this functionality is available in Enterprise E5 if required. Only calendar month periods are supported e.g. 4 week periods are not supported. Processing of returned goods to generate a sales credit note is only supported by Office Professional. The software does not support substitution with alternative products. Purchase order processing is only supported by Pro. Customers having specific requirements in this area should refer to section 9 of the questionnaire. Certain stock control functions are not available in Office Standard and Office Start. Customers having specific requirements in these areas should refer to sections 9 and 10 of the questionnaire. The software does not perform consolidation of multi company accounts. 3. Disclaimer Any organisation considering the purchase of should consider their requirements in the light of proposals from Mamut or its resellers and potential suppliers of other similarly specified products. Whilst the contents of this document are presented in good faith, neither ICAEW nor Baker Tilly Tax & Advisory Services LLP can accept liability for actions taken as a result of comments made herein

9 ICAEW Accredited Products Scheme Financial Software Accreditation Questionnaire Contents 1 Security and continuity of processing 9 2 Input of transactions 15 3 Value Added Tax 25 4 File maintenance 38 5 Processing 42 6 Reports 44 7 Performance of requisite accounting functions 53 8 Sales Order Processing and Invoice Production 63 9 Purchase Order Processing Stock Control User documentation Efficiency Integration and www facilities Support and maintenance

10 1 Security and continuity of processing 1 i) Are different levels of passwords provided to control access? ii) Is this level of security appropriate for the expected level of business using the software? Mamut Business Software requires every user to have a personal logon identifier and password combination, providing fully configurable access to the system. Yes. The security functionality allows a great degree of control by the administrator. Pro Std Start 2 i) Is each user required to have a personal password? Yes, every user must log on with their password. Confirmed attempts to log on with incorrect username or password failed. ii) Can a report be produced detailing all current users and their authority levels? Yes It is possible to view all users and, individually to view their authority levels. It is not currently possible to generate a report showing the authority levels of all users but this is being developed for a future release

11 3 Do the security features cover: i) System access? Yes, access to the system is controlled by the username and password combination. ii) Company access? iii) Menu (ledgers)? iv) Sub access facility)? access menu (ledger Yes, the user s Access Groups control which companies the user can access. Yes, only modules available to a user are visible. Yes in terms of tasks which can be performed within a module v) Field access? Sometimes. User-level field access can be setup and restricted by an administrator. 4 Does security allow for read and read/write access to be specified separately? Yes - Functionality exists to allow some users read-only access within screens, while providing others with read/write access. This type of access is determined by the access User Groups assigned to the operator identity. The ability to determine whether data can be amended (read/write) or simply viewed (read-only) can, in some instances, be extended to specific fields within a screen. Confirmed access levels specify which modules available and within each module which functions. Indirectly via specifying which functions are available. Access levels to approximately 300 functions can be controlled. Confirmed. 12 predefined user groups are provided and these can be amended or further groups created

12 5 Can the menus be tailored by the software house or an educated user so that an individual user can only access those functions they are authorised to access? Yes. Menus can be tailored by educated users. Confirmed by ticking checkboxes specifying which functions are available to a user or group. 6 Does the system provide specific levels of password control to authorise master file amendments? 7 Are there specific security procedures (by passwords or warnings) over the: i) Update of ledgers? ii) Closing of accounting periods? iii) Deletion or archiving of transactions 8 Is there a clear indication in the system or manuals as to how the data is backed-up and recovered? Yes. Each user s access rights determine which amendments can be made by the user. A warning is displayed before ledgers are updated. A warning is displayed before an accounting period is closed. A warning is issued and a backup is taken prior to year end closure. Yes, guidance for creating backups is found in the context-sensitive help text. This is started by pressing F1 Confirmed. The log shows date and user for period updates. Confirmed. An additional warning is provided if the period is also the end of a VAT period

13 9 How is this provided: i) Within the software application? ii) Within the operating system? iii) Are any of these procedures automatic? iv) Is the user forced or prompted to back-up at certain intervals? v) Can the intervals be customised? vi) Do the recovery procedures work? i) Yes. The File/Backup/Create backup menu facility is used to create a backup. ii) See answer above. However, many companies keep their data on a network, and this is backed-up as part of their network backup. iii) The final user can be automatically prompted to backup when they log off. iv) Yes, you can choose daily, weekly, monthly or when the last user logs off. v) Yes within the settings shown above. vi) Yes, there are no known faults on the backup or recovery procedures. Confirmed. All companies or a single company can be backed up. Various options exist to split the backup into specified file sizes etc. Confirmed it is possible to turn off backup prompts if server based backups are performed. Confirmed by deleting customer record & restoring from previous backup. 10 Does the system facilitate recovery procedures in the event of system failure? (Eg Roll back to the last completed transaction). Yes. The system saves any completed transaction to the database. Only changes being applied at the time of the system failure will need to be re-entered. The installation has an automatic rollback procedure. All important program files are automatically replaced if deleted Confirmed the system recovered following an abnormal end to processing. Upon restart a warning was provided that the previous user did not exit properly and the database integrity was checked automatically

14 11 If system failure occurs part way through a batch or transaction, will the operator have to reinput the batch or only the transaction being input at the time of the failure? 12 Are there any features provided with the software to help track down processing problems? 13 Are system messages clear and are user responses properly structured to ensure that erroneous key strikes do not lead to inappropriate actions? 14 Is there a system log which details: The user will only have to enter the transaction at the time of the failure. Yes. The system logs processing error information for use by Mamut support. Yes. Messages accurately inform the user about the decision to be made. The user responses are Microsoft standard (Yes/No), (OK/ Cancel), (Next/Previous). i) User activity? i) The system log (File/Export/System Log/All Events) provides a log of date, time and user for backup, client settings, accounting settings, print of journals (invoice and ledger), vat-report, year and period closure, system tools and upgrades. Confirmed the log shows login attempts and system events with date, time and user ID. ii) Error messages? iii) Security violations? ii) Yes. System error messages are logged to assist Mamut Support with resolution of errors. iii) Invalid login attempts are recorded

15 15 What are the Years can be entered as 2 or 4 procedures for digits. handling dates? (E.g. 2 digit, 4 digit). i) In the case of two digits what is the break point for the century? ii) Are dates handled consistently throughout the software? 30 is the break point. i.e. 31/12/29 = 31/12/2029 and 01/01/30 = 01/01/1930 Yes. All years fields are handled as above. Confirmed dates entered as 2 digits are stored as 4 digit dates according to these rules. Some dates are displayed as 2 digit dates although in the database 4 digits are stored. 16 Economic and Monetary Union. What approach will the supplier take towards handling the EURO? Consider requirements: - before the UK joins the EMU; - transition period, i.e dual currency in the UK; - post the transition period. Mamut Business Software can already allow input to be made using any currency present in the currency register. All current world currencies exist in the register. The customer can add new currencies as required. MBS is using the Euro in the Netherlands. The multi-currency facility would enable dual currencies to be processed within the UK during a transitional period. In the event that the UK joins the EMU and the need for any special functionality is identified, Mamut Business Software will make sure this is handled automatically by the system. In particular a conversion routine will be required to convert automatically from GBP to EUR. Confirmed

16 2 Input of transactions The following sections in Input of transactions, File maintenance, Processing and Reports are primarily aimed at the three main accounting ledgers (General Ledger, Sales Ledger and Purchase Ledger). Where there are other modules (eg Sales Order Processing, generating invoices, Purchase Order Processing and Stock Control) questions, where applicable, need to be related to these modules. 1 Is data input controlled by selfexplanatory menu options (and are these menus applicationspecific)? Yes. Screens within the various modules are accessed via a menu system that includes the module name and then the screen name. Users may optionally access the system via nine process oriented menu structures designed to aid workflow (eg HR, Accounting, Executive, Sales Automation, Logistics) All functions can be accessed via the view menu. Buttons are provided on a role based navigation bar as shortcuts to each user s most frequently used functions. 2 i) Does the system provide input validation checks such as account code validation, reasonablenes s (limits, VAT or discount checking) and validity checks? Where appropriate, journal types have mandatory requirements and restrictions. Account codes are always validated. Input VAT amounts are calculated, but may be overridden. Discounts are calculated automatically in sales order related processes. Confirmed. For example, entry of invalid code results in a pop-up box showing valid similar codes to select from. ii) Can the user amend data on an input screen prior to update? Yes. Validation failures are notified to the user for correction before the data is applied

17 3 What are the control features which ensure completeness and accuracy of data input eg, batch control, matching, review of audit trail; are all input transactions subject to this control? 4 Does the system allow for batch control totals? If so: i) Are batches automatically numbered? ii) Are batches forced to balance before ledger update? Mamut Business Software assists batch control by providing control totals within the screens and reports that allow batch input. Wherever matching is appropriate (i.e. between invoices and credits) the system ensures that successful matching is applied. Use of drop-down lists assists the selection of data to appropriate responses - i.e. a drop-down list of suppliers is presented when completing a purchase order. Audit trail reports are provided whenever the ledgers are updated with input into Journal Entry or via another module within the application. The control concepts are applied consistently throughout the application Yes. The system applies sequential numbering of all identifiers. Yes. A batch of journals cannot be saved/further processed unless it balances. iii) Does the system allow the temporary halting of input of a batch to allow for queries or other activities to take priority (eg set up a new account) Yes. A batch can be saved but remain unposted until approved by a user with sufficient access authority. Confirmed. For example a batch of journals can be amended prior to posting

18 iv) Is the user forced to confirm batch totals? 5 Is attempted posting of unbalanced journals rejected? (G/L). 6 Are input errors highlighted? Are they: No. The input screen shows batch totals, but this does not need to be confirmed by the user. Additionally, a report is produced when journals are applied, and the user must confirm that the content is correct. Yes. See above 4)ii). i) Rejec ted and reporte d on screen? Yes. Unbalanced journals are reported on screen when the user attempts to save the content. The user can then take corrective action. ii) Rejec ted and error reports generat ed? N/A input errors are not allowed to remain present. N/A it is not possible to proceed until errors have been corrected. iii) Acce pted and posted to suspen se? N/A input errors are not allowed to remain present. N/A it is not possible to proceed until errors have been corrected

19 7 Is a detailed audit trail of all input data generated? i) Are transactions allocated a unique reference number by the system? ii) Is this trail adequately protected from deletion? Yes. Every journal type is given a sequential reference number. Yes there is no facility to edit or delete a reference. 8 i) What are the controls to ensure the internal integrity of the ledger(s) or the accounting information, eg, control of accounts. Database triggers update ledgers. It is not possible to post directly into ledgers. Control accounts in the Nominal Ledger `are automatically updated in line with postings to the Customer and Supplier Ledgers. Confirmed. For example attempts to post to the creditors control account fail without the corresponding posting to the ledger. ii) Is it impossible to allocate input values directly to ledger control accounts? (G/L). Yes. All input must be made to a separate journal environment. Integrity and control checks are then performed before the transaction can be posted to the general ledger

20 iii) Is there a mechanism to allow the user to establish that the total balances on individual accounts agree to a respective control account? eg System Integrity Check. 9 i) Can automatic accruals or prepayments be generated? ii) Will these automatically be reversed after the period end? (G/L) Yes, reports can be displayed when wanted. Reconciliation Nominal Ledger/Customer & Supplier Ledger will, for example, integrity check the Customer and Supplier ledgers. However, as noted above (8(i)) the update of the Control Accounts is automatic. Yes, using the Journal Templates functionality. Journal templates allow the user to create a set of journals that can be rapidly re-applied under the user s control. Typical examples of this could be the payment of utility bills or accommodation/office rents. No - Mamut does not support reversing journals, but a matching reversing template could be created as described above (9(i)). The system does not automatically reverse journals but a template can be created to facilitate reversal of frequent journals

21 10 Is the ledger open item, rather than balance forward (or capable of being maintained as either)? (S/L, P/L, G/L). S/L, P/L and G/L are open Items. 11 Does the system permit multi debit/credit journals? 12 Are all transactions adequately identified on screen as to type and as to debit or credit? Yes. The system will allow any number of journal lines within a balancing journal. Yes. A Journal Type field is prominently positioned in the Journal Entry screen. Separate debit and credit columns clearly present the nature of the transaction. 13 Can separate nominal analysis codes be input for each invoice line? (S/L, P/L, stock) Yes. Department, project, nominal code and VAT-handling can be input for each invoice line (S/L and P/L) Confirmed by posting invoice line across multiple nominal codes. 14 Can cash receipts and payments be matched to specific invoices? Yes. This is achieved using the Match/Link items functionality with the Sales and Purchase ledgers. Confirmed by entry of payment and selecting matching invoices from a list of open items on the account. 15 Will the system permit part payments? Yes. If a part payment is made or received, it is associated with the original entry. The original entry plus any part-payments remain present in the S/L and the P/L until the full balance is cleared

22 16 i) Will the system accept credit notes in the purchase ledger? ii) Will the system generate credit notes in the sales ledger? 17 i) Does the system provide for early settlement? ii) Can these be automatically generated? iii) Are there controls over accepting settlement discounts (eg time limits)? iv) Is VAT treated correctly on early settlement discounts? Yes. Credit notes can be entered by selecting credit note in purchase order entry. Credit Notes can also be entered direct to the Ledger in Journal Entry. In addition, cancellation of a processed purchase invoice will automatically create a purchase credit in the P/L. Yes. Credit Notes can be entered by selecting credit note as the order type in sales order entry. Credit Notes can also be entered direct to the Ledger in Journal Entry. In addition, using the Delete facility on a processed invoice will invite the user to create a credit note. These can then be posted to the S/L. Yes, manually. Early settlement discount automation is being considered for a future release. Mamut Business Software does not currently make automatic provision for early settlement. N/A. N/A N/A N/A N/A N/A

23 18 i) Will the system permit the posting of unallocated cash to the ledgers? (S/L, P/L) Yes it is possible to post unallocated cash against a temporary invoice prior to being matched against the correct invoice. Confirmed. Subsequent matching clears the relevant open item. ii) Are unallocated cash/credit notes specifically reported for follow up? N/A. N/A 19 Are outstanding transactions displayed for allocation? (S/L, P/L) Yes. Opening the Customer ledger or the Supplier ledger invites the user to filter on outstanding transactions. When entering payments the open items are automatically displayed and can be selected for payment by checking a tick box alongside each open item. 20 Is it possible for new accounts to be created during sales invoicing or input of purchase invoices? Yes. If the user rights allow, it is possible to create a new contact (supplier or customer) from the Select Contact window, shown at the very start of creating a new order. The account must, however, be set up before progressing to the detail of the order. Confirmed by creation of new supplier record during entry of invoice. 21 Is there control over the creation of new accounts? User access restricts those who can create new accounts

24 22 Is the user prevented or warned from overriding credit limits or discounts? (S/L). Yes. When creating a new order the user receives a warning that the customer is over his credit limit. The user can then choose to enter the order or not. The user is prevented from invoicing the order. Confirmed. It is possible to create the order but the system prevents the order being processed for delivery and invoicing. 23 If the system enables transactions to be posted to the ledgers whilst performing a bank reconciliation (eg standing charges, bank charges etc) are these adequately reported? The system does not allow transactions to be posted during the Bank Reconciliation process. However, the system allows a bank reconciliation in progress to be saved so that any transactions can be posted before returning to the bank reconciliation to complete it. N/A no postings allowed while any user has the bank reconciliation window open

25 24 i) Does the system accept input files from other computer packages? The system accepts correctly formatted journal information through Mamut s Import/Export facility. Additionally, Mamut API, a supplementary product to Mamut Business Software, makes it possible to export information from and enter information into the Mamut system without using Mamut s normal user interface. Mamut Business Software saves all information in databases. Mamut uses a database called MS Visual FoxPro, developed by Microsoft, and part of the MS Visual Studio package for developers. MS Visual FoxPro is an open database, and all information is accessible with an ODBC driver. The ODBC driver for MS Visual FoxPro is free and can be downloaded from Confirmed. Successfully imported text file of customer data. ii) What are the controls in place over the interface? User access rights control who can access the Import/Export facility. 25 Does the system have a facility for calculating interest on late payments? Yes, interest can be calculated using the Interest rate for credit charging value. Options are never, always, only over 30 days or a customized rule can be created. Confirmed it is possible to generate interest charges for late payment after the payment has been received. It is not possible to generate interim interest charges prior to payment being received

26 3 Value Added Tax The following sections detail the general requirements/features of an accounting package in handling VAT. It cannot cover all eventualities or all users and where necessary members should contact their local VAT offices for detailed guidance. The overall objective is to accurately record the accounting for VAT in order to support VAT returns to Customs & Excise. N.B Cash accounting: VAT is based on cash payments or receipts for which tax invoices, or equivalent documents are held or issued (for goods or services). Payments in advance are not allowable to input VAT claim until the tax document is received. Receipts in advance or unallocated cash are subject to VAT at the standard rate. On invoice entry the VAT amount should be posted to a general ledger balance sheet input VAT suspense account to be reduced on payment or receipt of the VAT amount with the equal entry to the general ledger balance sheet VAT control account. Reconciliation or VAT analysis should be available for the General Ledger VAT suspense accounts (input and output) to invoices received/issued and the outstanding creditors and debtors listings. (i.e the amount of VAT in and out should reconcile to the invoices issued, received and expected). System features 1. Features required for the recording of VAT: UK VAT registration number EC VAT registration numbers (10) Yes found in the Contact Register under the VAT Reg. No. Yes - found in the Contact Register under the VAT Reg. No. VAT (nn.nn) rate Yes (format as shown) rounding, to be applied consistently (up or down to the nearest penny but not to zero Yes. All rounding is consistently applied to the nearest penny

27 VAT) 2. Security, by password and/or audit trail to control changes to: general ledger VAT control accounts User access rights (and the associated password) control who can amend VAT settings. The VAT control accounts, however, cannot be deleted or amended. VAT tables See answer above. tolerance levels (if applicable) invoice number table change s on VAT code on custom er and/pro duct files VAT calculated on sales invoices or credit notes N/A. User access rights (and the associated password) control who can amend the invoice number series. The invoice number can only be increased, preventing duplication of invoice numbers. User access rights (and the associated password) control who can amend the customer and product VAT codes. The VAT calculated cannot be changed only the VAT code. See answer above. N/A

28 3. Method of operation a) VAT basis. Can the system handle: invoice (standard) accounting for VAT Yes. cash accounting for VAT? Yes Confirmed availability of cash accounting for VAT. b) Where systems can handle both invoice (standard) and cash methods of accounting for VAT, is the basis clearly identified during set up? c) Is the ability to change a basis of accounting clearly flagged, i.e users warned etc. and supported by audit trails to ensure proper VAT treatment of all transactions. Yes, a selection box is provided during set-up, and a warning/information box is displayed if Cash-VAT is activated. Choice must be confirmed. Yes, attempting to change will display a warning/information box and action needs confirmed Confirmed Confirmed

29 4. Input VAT (purchases ) a) Are there sufficient VAT codes to analyse input VAT: UK VAT chargeab le (10 codes) EC acquisitio n tax Yes found in the Contact Register under the VAT Reg. No. Yes supported. No VAT Yes supported. exempt Yes supported. VAT Yes supported. inclusive reverse charge tax Yes supported. b) The following invoice details will be required to be input: supplier reference invoice tax date invoice gross total All answers refer to journal entry of purchase invoices. Yes A valid supplier reference number is always required. Yes The Date field in Journal Entry serves as the tax date and must be supplied. Yes Entered into the Journal Entry window

30 individual invoice lines: net amount VAT rate (optional from VAT code, product supplier c) The system should validate individual invoice line VAT amounts against the total invoice of VAT (less early settlement at discount) and accept or reject the amount subject to a tolerance. Where the amount is within the tolerance it is the amount on the suppliers invoice which must be used to derive the amount recoverable. Yes, the amount can be input as Net or Gross, dependant on settings in the Journal Entry screen. Yes taken from product code and amended if the supplier is EC based (and has a registered VAT number) or non-ec based. The user is prompted with the calculated VAT but can adjust it to allow for rounding differences although there is no tolerance test on the adjustment

31 d) Where a system allows VAT to be reclaimed on the basis of registered but unposted invoices, the system must allow for the VAT status of invoices to be flagged as: VAT not yet reclaimed or VAT claimed 5. Output VAT (sales) a) Are there sufficient VAT analysis codes to identify the following: N/A N/A N/A No registered but not posted facility exists. N/A N/A UK chargeable Yes supported. EC VAT: goods and related services Yes supported. Confirmed. services only Yes supported. process Yes supported. triangulation Yes supported

32 exempt Yes supported. export to a third country Yes supported. UK sale zero rate by certificate/ treasury distance selling (supply to an unregister ed EC customer) outside scope b) For each invoice generated: unique invoice reference supplier, name, address, EC country code and VAT number date of invoice Yes supported. Yes supported. Yes supported. Yes supported. Yes supported. Yes supported

33 tax point (the date the supply takes place, the date of issue of a tax invoice or receipt of payment if before supply) the date of the tax invoice issued (if within 14 days of the date of supply) customer, name, address, EC country code and VAT number (if EC) type of goods supplied, quantity, description, net value, rate of VAT. Yes supported. Yes supported. Yes supported. total net charge Yes supported. rate of cash discount. total invoice and VAT value for each rate of VAT N/A Mamut does not currently support automatic calculation of settlement discount. Yes supported. N/A

34 type of supply The user can define which delivery methods are available from their organisatio n. These delivery methods can then be applied to an invoice. c) Pro forma invoices should be clearly identified as this is not a tax invoice. 6. Reporting The following reports should be available: a) VAT return by report period (three monthly, monthly or by other month ends if agreed with the local VAT office) b) summary of data included in VAT reports Pro forma invoices are clearly marked Pro forma invoice and include the text this is not a tax invoice. Yes supported by the VAT Return report. Yes see report VAT Return, Detailed

35 c) detailed analysis of data included in each return sorted by VAT code and transaction type. Totals of outputs and inputs required for boxes 6 and 7 of the VAT return, to be derived from the net amount totals from the appropriate VAT codes. d) total of EC supplies and acquisitions required for boxes 8 and 9 of the VAT return, to be derived from the net amount totals from the appropriate VAT codes. e) Audit trails, where appropriate to identify amendments to: Yes see report VAT Return, Detailed. Yes see report VAT Return, Detailed. VAT tables The software prevents user changes to standard VAT codes and rates. tolerance parameters invoice VAT calculations N/A. No. N/A N/A

36 customer/supplier/ product masterfiles f) full audit trail of details of all VAT postings with variances by report period and country code showing: customer VAT number, customer, reference number (invoice), invoice value ESL indicator. g) Exception reports or audit trail of all VAT postings where the computer generated VAT or calculated VAT has been overridden. Yes. Contact Information, detailed, Supplier List and Detailed Product Report gives information from these master files. No. No. N/A N/A h) EC sales list (ESL) reconciliation analysis including: Yes i) INTRASTAT reports where applicable. Not available Available in Mamut Enterprise E5 only N/A

37 7. Potential problem areas Can the system correctly handle the following circumstances: a) VAT control or Suspense accounts, are these protected from direct update by journals? b) How are errors on VAT accounts corrected? Supported A setting allows Mamut clients to allow or prevent amendments by journals. By posting correcting journals. c) VAT treatment of purchase and sales ledger contras both items VATable supplier is non VAT registered Yes - supported. Yes - supported. d)reimbursable expenditure, eg. Electric charge received and partly recovered from a sub tenant. Supported using journal entry (and specifically journal templates). Journal templates allow the user to create a set of journals that can be rapidly re-applied under the user s control. Typical examples of this could be the payment of utility bills or accommodation/office rents

38 e) Partially allowable expenditure, eg VAT on petrol invoices where employees are provided with petrol (adjustment required for own use) Supported using journal entry (and specifically journal templates). f) Can the system handle cheque refunds to customers? i.e. unusual transactions under cash accounting. Yes supported. Confirmed availability of VAT cash accounting. g) Can the system handle invoices with multiple rates of VAT? h) Can the system handle write off of bad debts and the VAT consequences? Yes supported. Yes supported

39 4 File maintenance 1 Is the creation or amendment of standing data (eg customer account details) controlled by menu options and are these menus applicationspecific? Yes. User access rights control which screens (and fields within the screen) are available for input or amendment. These menus are application specific (This is controlled by the licence administration system). Confirmed access to approximately 300 functions can be separately controlled. 2 Does the system provide input validation checks? (eg account number validation by displaying the underlying information relating to the account codes such as the description, completeness checks and format checks, i.e checking that the information has been keyed in correctly). 3 Are input errors highlighted? Are they: i) Rejected and reported on screen? Yes for example, whenever account numbers are required to be chosen, the associated description is offered to enable verification. Entry of all linkable data (a/c no s, supplier no s, product no s, journal types, etc.) is verified at the point of input, and additional information is provided to ensure the correct data is selected. Yes to minimise this, valid choices are, where possible, presented using drop-down lists

40 ii) Rejected N/A All input errors are Confirmed it is not and error advised on screen. possible to proceed until reports the input is valid. generated? iii) Accepted and posted to suspense? N/A All input errors are advised on screen. Confirmed it is not possible to proceed until the input is valid. 4 Does the system prevent an account from being deleted whilst it is still active? Yes An account cannot be deleted once it has been posted to. When it is no longer required, it can be marked as inactive. Confirmed attempts to delete an active account failed. Are there other constraints over the deletion of accounts? (eg movement during the year, associated subaccounts). 5 i) What is the length and scope of reference numbers GL/SL/PL? ii) Is it adequate to permit sufficient depth of analysis? No the restrictions above have proved sufficient. All nominal codes are 4 characters. All account codes are 9 characters. Yes Mamut has not identified a need to expand these items. Additional analysis can be obtained by use of the project and Department analysis codes. N/A

41 6 i) Are reports available for users to identify all master file changes? ii) Can reports be invoked which identify the fields which have been modified? No. No see answer above. N/A not available. N/A not available. iii) Would it be possible to show that these reports provide a complete record of all such changes? iv) Do the reports show how the fields have been modified? (eg before and after). N/A N/A. N/A not available. N/A not available. 7 If the system uses a lot of standing information which changes frequently or regularly, does the system allow for such changes to be effected through the use of parameters or tables? Yes. Tables are used to control all standing information, such as VAT rates, analysis codes, and master data. Most of these are controlled under the Company Settings

42 8 If so, is the use of such parameters or tables adequately reported? 9 Is proper control to be exercised over changes to such parameters? (If so, how? For example, through the use of system facilities such as passwords or by inspection of appropriate reports). These tables are reported to screen, and Print Screen can be used for a hard copy. They are also printed in reports relevant to the context of their use. Normal user access controls are applied so that only authorised users may access them. 10 i) Does the system allow selective archiving of old data on a user-defined basis? Data can be deleted but with modern databases there is no need to delete historic data. As integrated documents can occupy a large amount of space, users can specify their own document path outside the database to minimize disk space Confirmed archiving is unlikely to be beneficial. ii) Can this data still be used by the report generator? All data within the database is accessible by reports. iii) Can archived data be restored? Deleted data can be restored from backups. Confirmed restored a deleted account from previous backup. iv) Are there password controls over the handling (retrieval/saving etc) of archived data? Access to backup and restoration functions are controlled by user access controls

43 5 Processing 1 Does the system ensure that menu options or programs are executed in the correct sequence (eg ensure outstanding transactions are processed before month end procedures run)? 2 i) After an external document (eg sales invoice or cheque payment) has been generated and posted to the accounts is it impossible to amend this data? ii) Is there an audit trail of all changes to transactions which have updated the ledgers? 3 Can the system calculate prices or values by reference to master file data? 4 Does the system provide automatic recalculation, where appropriate, of data input? (eg VAT) Yes - The period closure process also requires that a number of reports (including a transaction journal) are printed before the period can be closed. Only the project and department information can be amended. The transaction figures and accounts can not be amended. N/A A transaction cannot be changed once it has updated the ledgers. A corrective transaction would need to be entered, and this would be reported when it is posted to the ledger. Yes The system identifies the price and value by reference to the Product master file. An additional check is made on the Contact master file to see if any additional discounts apply to the contact. Yes, if necessary the system will (re)-calculate the VAT amount according to the chosen VAT code

44 5 i) Does the system warn the user when the system is out of balance? ii) Is this check done on switching on or on ledger update? 6 Does the system include routines for recovery from abnormal termination (eg power cuts)? i) Are these automated? If a transaction does not balance an error message will be shown and the entry is not posted. There are no circumstances in which the system can become out of balance. The check is performed at the conclusion of input to a journal. The journal is confirmed to balance if this check fails, the user is asked to balance the journal. Yes In the event of an abnormally terminated process, the data structure is automatically checked upon the next start of the program. ii) Do they rollback to the last completed transaction? Automatically - The system always saves any completed transaction to the database, ensuring that only changes being applied at the time of the system failure will need to be re-entered. Confirmed system automatically recovered from an abnormal termination