PROCEDURES AND PAPERFLOW

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1 PROCEDURES AND PAPERFLOW I. Purchasing A. Purchase Orders 3 1. Special Orders 3 2. Stock Order 3 3. Printing 3 4. Monitoring 4 5. Acknowledging 4 II. Inventory Movement 5 A. Inventory Receiving Worksheet 5 B. Receiving 5 C. Reporting 5 D. Tagging 5 E. Filling Orders 5 F. Transferring 5 G. Updating Average Inventory Levels 5 III. Sales 6 A. Input/Changes 6 B. Changing and Voiding 6 C. Printing 6 D. Finalizing 7 E. Payments and Deposits 7 F. Balancing 8 IV. Delivery 9 A. Notification and Scheduling 9 B. Truck Input 9 C. Picking 9 D. Delivery Copies 9 V. Banking 10 A. Input 10 B. Reporting 10 C. Reconciling 10 D. Balancing 10 VI. Accounts Payable 11 A. Input 11 B. Posting 11 C. Reporting 11 D. Disbursing 11 E. Paying 12 F. Balancing 12 PROC & PPR -1

2 VII. Vendor Charge Back Procedures 13 VIII. Service 14 IX. Recommended Input and Reports Schedule 15 A. Daily 15 B. Weekly 19 C. Monthly 20 D. Yearly 27 X. Miscellaneous Procedure 28 A. Making Payments 28 B. Trade 29 C. Gift Certificates Purchase 30 D. Gift Certificates Promotional 31 E. Returns, Refunds and Credits 32 F. Rental Furniture 33 G. Check From Vendor For Damaged Merchandise 33 H. Check From Finance Company 33 I. Non-Inventory Items 34 J. Procedures for Paying Invoices By Credit Card 35 K. Pre-Paid Inventory Invoice Merchandise Deposits 36 L. Charitable Contributions 36 M. Setting Up an Additional Store 37 N. Applying Discount Coupons in Sales Orders 37 O. Reimbursing Petty Cash for Change 38 XI. How Transactions Affect the General Ledger 39 PROC & PPR -2

3 I. Purchasing A. Purchase Orders Quite often separate procedures must be followed for different types of purchase orders (Special Orders and Stock Orders). There are several reports and input screens that can facilitate these orders. 1. Creating Special Order Purchase Orders There are primarily 3 places that you will create these PO s. Sales Order - Make PO After the sale has been input and the special order model number created, you can select the Make Purchase Order option. Select the Save and Edit option. This will display a purchase order screen for you to complete by updating the arrival date, costs, quantities and notes. Make Purchase Orders Customer Back Orders This program will generate purchase orders for you automatically based on the sales that were input where inventory quantity is not available. This program will use Vendor and Model number defaults to come up with an arrival date and costs. Any notes would have to be entered manually at a later time through the Purchase Orders program. Inventory Allocation Report This program can report and/or create purchase orders based on back orders, as well as fill open sales orders with available stock. This program has a Report mode and an Update mode. The Report mode will simply report the purchase orders that need to be created. The Update mode will actually create the purchase orders as it recommends. 2. Creating Stock Purchase Orders There are 3 programs that you can use to create Stock Orders. Purchase Orders Purchase orders can be input, changed, voided, removed or printed through this program. Make Purchase Orders Min/Max Use to create stock purchase orders automatically, based on min/max. Min/Max quantities will need to be set up prior to running. Min/Max quantities are set up in the Model Maintenance program. Inventory Lookup - Use to create stock purchase orders on screen. PROC & PPR -3

4 3. Batch Programs - Use to Print Purchase Orders/Inventory Receiving Worksheets/Labels for purchase orders Use the Print Purchase Order program to print or fax in batch. At the same time (if not using Barcoding) print an Inventory Receiving Worksheet. The worksheets are used to record inventory receivings. You can also print labels, using the Label program run for PO s (necessary for receiving with Barcoding). Purchase Order copies needed - 1. Use to fax to manufacturer then forward to A/P to match with invoice. 4. Transferring Purchase Orders You may attach open purchase order items to pending transfers. This is used to flag items to transfer right after they are received. 5. Monitoring Purchase Orders Use the Purchase Order Report to monitor open, unacknowledged, past due purchase orders or purchase orders attached to voided sales. 6. Acknowledging Purchase Orders Use the Purchase Order program to Acknowledge purchase orders. Acknowledgements are input in the line items tab. Click on the Acknowledgments icon. At that time you can also update the arrival date and verify that the costs and quantities are correct. PROC & PPR -4

5 II. Inventory A. Inventory Receiving Worksheet Use this report to record inventory receivings (only if not using Bar Coding). Forward the Worksheets to warehouse to file in an open file. When the inventory is physically received the Worksheets will be retrieved and used to note the items that have been received. The worksheets are then forwarded to the person(s) responsible for inputting the receivings into the computer. Once completed the worksheets should be forwarded to the A/P department to match up with the payable invoice. B. Receiving Labels (Required for Barcode Receiving) Use the Inventory - Labels Purchase Order program to produce receiving labels. They can be created at the time the purchase order is created and filed until needed, or they can be produced when the merchandise is received. C. Receiving Use the Receiving program to receive merchandise from purchase orders. D. Reporting Use the Inventory Receiving Report to verify what was received. This report, which is optional, can be displayed or printed and filed. E. Tagging Use the Label program to print labels for newly received goods. Use the Inventory Movement Label option for transaction type Receivings. If you are using barcoding, you will need to print labels prior to receiving. F. Transferring Inventory Transfers Use the Transfers program to transfer inventory from one location to another. Use this program if you wish to show the transfer only after is has been completed. Pending Transfers Use the Pending Transfer program to schedule a transfer. The transfer is first input into Pending Transfers as Open. A printout is generated and forwarded to the person who will pick and transfer the inventory. Once the inventory is successfully transferred the transfer printout must be signed and then finalized in the system. The pending transfer forms should be filed in a completed transfer file by finalized date. G. Updating Average Inventory Levels Use the Update Turn and GMROI program to calculate and track these figures. This program should be run daily to ensure accurate average inventory figures to calculate GMROI and inventory TURN rate. PROC & PPR -5

6 H. Adjusting Inventory The Inventory Adjustment program should be used to add, subtract or adjust the cost or freight of an item in inventory. This program should have limited access. This program is used to miscellaneously adjust inventory quantities in the system. Example: You cannot physically locate an item in inventory. You must subtract the quantity from the inventory. A code will be required for the subtraction - use Cannot Locate. Each time an adjustment to inventory is input, you must print the transaction and file it with the day s business. Adjustments to inventory must be tracked and monitored closely. III. Sales Sales orders can be input at point of sale or by the back office. Point of sale is where the salesperson inputs the order into the computer and generates a printed copy. They would also make changes to the order, such as handling voids and returns. You may choose to have the salesperson only be responsible for the input of sales orders and have any changes handled in the back office. If you choose not to be point of sale, the salesperson will hand write the sales order and either they or the back office will input at a later time. Typically there will be 3 copies of the sales order produced: Copy 1 - Goes to the Customer. Copy 2 - Used to input and balance written sales. Filed with the day s business, Filed with the Daily Balancing Report Written Sales. * The second copy is not necessary if you are using Point of Sale (POS). Copy 3 - Used to schedule delivery. Filed in an open delivery file until the sale is finalized. This copy is then filed with the day s business. Filed with the Daily Balancing Report Delivered Sales. * The third copy can be eliminated if the Sales Order Report and Print Delivery Tickets or the Truck Stop Report are used to schedule and complete deliveries (see Delivery section below). A. Input of Sales Orders Use Sales Order - New mode. It is recommended that all sales are input as (O)pen, then (F)inalized only after the customer has taken possession of the merchandise. The written sale will be recorded along with the original deposit and any notes. Special Order purchase orders can be created at this time, using the Make PO mode. B. Changing and Voiding Sales Orders Use Sales Orders. Changes can be made to the line items that are still open. To void a line, highlight the line to be voided and click the Void button. PROC & PPR -6

7 When making a change to quantities or prices it is recommended to Void the line and re-key in a new line with the updated price and/or quantity, unless it happens on the same day as the original input. The revised order should be printed again, and used to balance on the new day s business. C. Printing Sales Orders Use Sales Orders - (P)rint mode or Print Delivery Tickets. Used to generate copies of the sales order singly or in batch. D. Finalizing Sales Sales Orders Finalize button. Use to finalize sales in the computer. This includes Returns and Adjustments, which will be finalized in the original program of input. Sales should be finalized with a document (See delivery below) verifying that the merchandise has actually been delivered. This can be a delivery copy of the sale or a Truck Stop Report. The back office usually does finalizing of sales orders. The order is finalized as of the actual delivery date. The delivery document is then used to balance, and filed with the day s business E. Inputting Deposits and Payments There are 4 programs that can be used to input Deposits and Payments. 1) Payment Input is used to input payments and generate a receipt. Click the Receipts button to print the actual receipt. 2) Multiple Payment Input is used to input multiple payments. Click the Receipts button to print the actual receipt. Often used to input a check from a Finance Company. 3) Customer Account Lookup - Payments button used to input payments and generate a receipt. Click the Receipts button to print the actual receipt. It is recommended that any payments made after the original deposit be input in Payment Input or Customer Account Lookup. These 2 programs will allow you to print a receipt, which then can be used to balance with the day s business and filed. F. Miscellaneous A/R transactions All miscellaneous A/R transactions must be input and balanced with the day s business. This program should have limited access and be monitored closely. Miscellaneous A/R transactions include: 1) Refunds; 2) Restocking Fees; 3) Nonsufficient Funds transactions. PROC & PPR -7

8 Programs to input Miscellaneous A/R transactions: 1) Miscellaneous Transaction Input 2) Transfer Dollar Input 3) Refund mode in Sales, Returns, Adjustments and Customer Account Lookup Each time a Miscellaneous A/R transaction is input, it must be printed. The printout will be used to balance and filed with the day s business. G. Balancing (see Daily Checklist for more details) 1) Balancing Deposits, Payments and Refunds Cash Balancing Report is used to balance all payments and deposits. You will match entries on the balancing report with actual cash, checks and credit card slips. You will verify that every transaction was keyed into the system and input correctly. Once all input has been verified you must create the bank deposits. You can do this manually through the Banking Module. Use Register and select Deposit. The other option is to run the Cash Balancing Report in the Make Deposit mode (this requires setup in Payment Method Maintenance see Setup Training Workbook). This mode of the Cash Balancing Report will create the deposits automatically based on mappings setup in Payment Method Maintenance. Once the deposits have been created, you must run a Bank Account Report for deposits entered for that day s business. Verify that the deposits were created correctly. FILE WITH THE DAY S BUSINESS: 1) Copy of actual Bank Deposit Slip; 2) Summary printout from the Credit Card Machines; 3) Cash Balancing Report; 4) Bank Account Report. 2) Balancing Sales and Close Day Balancing Reports Written, Delivered, A/R and Inventory are used to assist in balancing out the day s business. With a copy of every written sale (optional, if POS), delivered sale, misc. A/R transaction and inventory adjustment, you will verify that all documents were keyed into the system, and done so accurately. The first mode is a balancing mode. The second is the mode to close the day once balanced. Once the Close Day mode is run, you will be unable to input transactions for that day s business. FILE WITH THE DAY S BUSINESS: 1) Copies of Written Sales (optional if POS); 2) Copies of Delivery Tickets; 3) Printouts of Misc. A/R Transactions; 4) Printouts of Inventory Adjustments 5) Final Balancing Report printout when Close Day mode has been run. PROC & PPR -8

9 IV. Delivery A. Notification and Scheduling Once the inventory has been received into the system, delivery can be scheduled. The Sales Order Report can be run for Newly Filled sales orders. The Sales Order Report is then given to the person(s) responsible for notifying the customer that the goods have arrived. At that time, with a manual calendar or the Delivery Calendar in the system (setup required see Setup Training Workbook), a delivery date can be arranged. The customer s sales order is then updated with an actual delivery date. Customer returns and service orders must also be updated with an actual delivery date if a delivery ticket is to be generated. B. Truck Input If you have chosen to use the Truck Module, specifically Truck Stop Input, you can then assign sales, returns or service orders onto trucks, based on the delivery area. You can then run the Truck Exception Report to verify that everything that was scheduled for delivery that day got scheduled on a truck. C. Picking Once the deliveries have been scheduled, you can run an Inventory Picking Report. You may run a report or labels. The report will list all items that need to be picked for delivery, by location. The label mode will produce a label for every item that needs to be picked D. Delivery Copies Delivery copies can be generated from Print Delivery Tickets or the Truck Stop Report. Both reports are run by Actual Delivery date ranges. Most frequently, the delivery copy will be taken out on the truck where a customer s receipt of delivery signature is acquired. These copies are then routed to the back office where they will be used to finalize the sales in the computer. These copies must also be filed with the day s business. PROC & PPR -9

10 V. Banking A. Input The Register program in the Banking module is used to input bank deposits, withdrawals and other banking transactions. B. Reporting Bar Account Report, used to report, review and balance banking transactions. C. Reconciling In the Register program of the Banking module there is a Reconcile mode. Use this program to clear banking transactions as shown on your bank statement. It is important to enter the bank statement date, before you begin to change the transactions to cleared. Do not choose Close Out until you are completely finished reconciling that month. Always print the Bank Reconciliation Report and verify it balances to the bank statement before you Close Out. To do a bank reconciliation you must have your actual bank statement. With the statement, go into the Register program and select Reconcile, which will show all open transactions. Enter the bank statement ending date. Clear the entries as shown on your bank statement then Click Save, then Click Close (Do not Click Close Out until you have a printed copy showing balanced to the bank statement). Run the Bank Reconciliation Report for the same date as entered in the Reconcile mode. Verify that the ending balance on the report balances exactly to the bank statement. If it matches, go into the Register mode again, select Reconcile, enter the bank statement ending date and Click Close Out. If it doesn t balance to the bank statement ending balance, run a Bank Account Report for the same date range and match totals by transactions. That would narrow it down to which type of transaction might be wrong or missing. D. Balancing In the Balancing module, use the Balance G/L to Cash report to balance your Bank Accounts to the General Ledger. PROC & PPR -10

11 VI. Accounts Payable A. Input Accounts Payable Input is used to input payable invoices, change or void invoices. Payable invoices can only be changed if the invoice is un-posted. Chargeback Input is used to input and track vendor chargebacks. B. Posting Purchase Journal Report is used to post payable invoices. After payable invoices are input using the Accounts Payable Input program, they must be posted using the Purchase Journal Report. Run the report for all (U)nposted invoices to review, then post. C. Reporting Accounts Payable Report is used to review outstanding payable invoices to decide which to pay. The report can be run for invoices and chargebacks. D. Disbursing Payable Disbursements is used to flag payable invoices for payment. The Accounts Payable Check Program will only print checks that have been disbursed in this program. To disburse invoices in batch go into the Payable Disbursements program. Enter the Due Date you want to disburse invoices through. Click Apply Criteria. Go to the Line Items Tab. At this screen you may undisburse invoices or change the amount to disburse, manually. When done making edits, click Save. Once the Payable Disbursement screen has been saved, to change, delete or add an additional invoice to the disbursement list, use the Accounts Payable Input program. On the History Tab, you may change a disbursed amount or discount, as well as add a disbursed amount to a new invoice. See below. PROC & PPR -11

12 Use the Payables Disbursement Report to report and verify payables disbursed through the Payable Disbursements program. Use the Accounts Payable Input Program History tab to make any changes. E. Producing Checks Accounts Payable Checks is used to produce payable checks in batch. Invoices must be disbursed through the Payables Disbursement program, or manually through the Accounts Payable Input program, using the History tab to generate checks. To generate a manual check, use the Check mode located in the Register program of the Banking module. F. Balancing In the Balancing module, use the Balance G/L to A/P report to balance accounts payable invoices to the General Ledger. PROC & PPR -12

13 VII. VENDOR CHARGEBACK PROCEDURES A manual procedure needs to be created for the warehouse person to notify the A/P person about any problems with newly received inventory. Usually some type of manually filled out form works well. The warehouse personnel will keep the original form and forward a copy to the A/P department. The warehouse will keep the forms in an Open Problem Inventory Book. Once notified via the form, A/P will need to input an inventory transfer. A/P will move the item from an available for sale status to a Not Available for Sale status. Then, once the inventory is physically returned to the vendor, or fixed internally, the warehouse personnel will return the original form to A/P with notes of completion. A/P will then adjust the cost and /or freight of the inventory (if repaired) or subtract (if returned to vendor). To subtract the item, use Adjustments, referencing the code Return to Vendor. Next A/P will then go into Charge Back Input located in the A/P module and input a Vendor Chargeback. The chargeback should be input for the amount expected from the manufacturer as a credit. The chargeback should then be printed and mailed (and/or faxed) to the manufacturer. The chargeback will be input as unapproved and with a Hold Code: Do not Post. Once approved, the chargeback should be flagged as approved and the Hold Code should be removed. At this point the credit is ready to be applied towards a payable invoice. To monitor the inventory, A/P can run an NIR Not Available for Sale Inventory Report for status type Return to Vendor. A/P can give that to the warehouse person, and they can review what is still pending return. To monitor the un-approved chargebacks, A/P can run an APR - Accounts Payable Report. This will allow them to review all chargebacks submitted that have not been approved. PROC & PPR -13

14 VIII. Service A. Service Setup Create Service Department ZSERV Create Service Vendor SERV Create Service Models pick-up fee, parts, etc. Delivery Zone SERVICE Delivery Calendar by month B. Service Input Customer calls regarding a problem with Merchandise they have in their home. Service order is input and printed. Forwarded to Service Department to schedule in-home service or pick-up. Schedule service using Service Delivery Calendar. Setup date in the Actual Delivery date. Updating service order with changes. Create parts purchase orders or void the service order if necessary. C. Loaner merchandise Use Transfer Input to transfer the item into a Not Available Status Loaner. Enter the service order number in the Comments field. D. Once service is complete, finalize the service order, record and payment due. PROC & PPR -14

15 IX. Recommended Input and Reports Schedule DAILY PURCHASE ORDERS - located in the Merchandising module - used to input stock purchase orders. You may also use the MAKE PURCHASE ORDERS PROGRAM based on Min/Max s or the INVENTORY LOOKUP PROGRAM. MAKE PURCHASE ORDERS Customer Back Orders - located in the Merchandising module used to create purchase orders for Special Orders. INVENTORY ALLOCATION REPORT used to create Customer Back Order purchase orders. PRINT PURCHASE ORDERS located in the Merchandising module- used to print purchase orders. INVENTORY RECEIVING WORKSHEET - located in the Inventory module - used to print worksheets to be used to receive inventory. MERCHANDISE TAGS - located in the Merchandising module - used to print merchandise tags for incoming inventory based on PO s. Also can be used to tag existing inventory. RECEIVING - located in the Inventory module - used to input inventory receivings. SALES ORDER - located in the Sales module - used to input, change, void and finalize sales orders. ADJUSTMENTS - located in the Sales module - used to input adjustments to finalized sales. RETURNS - located in the Sales module - used to input, change void and finalize returns. PAYMENT INPUT - located in the A/R module - used to input customer payments. MULTIPLE PAYMENT INPUT - located in the A/R module - used to input multiple customer payments. MISC. TRANSACTION INPUT - located in the A/R module - used to input miscellaneous A/R transactions. Example: refunds, restocking fees, donations SALES ORDER REPORT run for Newly Filled Sales - located in the Sales module provides a list of customers whose orders have been filled with Newly Received Merchandise. This report can then be used to schedule delivery for newly filled orders. INVENTORY PICKING REPORT - located in the Inventory Module - report used to pick inventory for delivery. PRINT DELIVERY TICKETS - located in the Sales module used to print delivery tickets for Sales, Returns or Service Orders. PROC & PPR -15

16 REGISTER Deposits - located in the Banking module - used to input daily bank deposit. CASH BALANCING REPORT - located in the Balancing module - used to balance customer monies. Can also be used to post daily bank deposits. BALANCING REPORTS Written, Delivered, A/R and Inventory - located in the Balancing module - used to balance written sales, delivered sales, inventory adjustment transactions, accounts receivable and revolving entries. UPDATE TURNS AND GMROI - located in the System module - used to update the average inventory levels of your inventory. Running this Daily is extremely important if you wish to report an accurate GMROI and TURN RATE. ACCOUNTS PAYABLE INPUT located in the A/P module - used to input invoices or bills. PURCHASE JOURNAL REPORT located in the A/P module - used to print and edit a list of everything that you entered via Accounts Payable Input. Used to review and edit dollar amounts, G/L account numbers, vendors, discounts, etc. BACKUP OF THE MYRIAD DIRECTORIES PROC & PPR -16

17 DAILY BALANCING PROCEDURES Cash and Sales 1) BEFORE YOU BEGIN - Ensure all data entry is complete. Daily balancing primarily involves balancing sales, accounts receivable and inventory. The two reports used to balance the day s business are the Cash Balancing Report and the 4 Balancing Reports, which include Written, Delivered, A/R and Inventory. Typically, no proving back to the general ledger is done on a daily basis. Proving to the general ledger is done at the end of the month. For those who have consistently had problems balancing at the end the month, it is sometimes recommended to balance to the general ledger every day. a. Balancing all accounts receivable transactions including miscellaneous b. Balancing written and delivered sales, adjustments, customer returns or service c. Miscellaneous inventory adjustments Daily Input All daily input requires a printout to be filed with the day s business. Daily input that requires balancing includes: 1) Payments and Deposits It is recommended that all payments and deposits are input in a timely manner. 2) Sales, Returns, Adjustments and Service Orders these transactions must be input in a timely manner. Regardless if you are Point of Sale or Back Office, a copy of each written document needs to be accounted for, reviewed, and filed with the day s business 3) Miscellaneous A/R Transactions these include transactions input through: Miscellaneous Transaction Input Transfer Dollar Input d. Inventory Adjustments any transaction input through IAI Inventory Adjustment Input - must be printed and filed with the day s business. PROC & PPR -17

18 Reports Cash Balancing Report and the Daily Balancing Reports The Cash Balancing Report is used to balance physical monies, checks, cash and credit cards. Once balanced, it is recommended that the bank deposit slip, along with the credit card machine summary, be attached to the Cash Balancing Report for filing. The next step, with the Cash Balancing Report, is to make the bank deposits. This can be done using the Register program located in the Banking module. Once the bank deposits are made, they should be printed using the Bank Account Report for deposits, run just for the date of those just entered. This report should also be filed with the day s business. The Daily Balancing Reports include Written, Delivered, A/R and Inventory. They are used to balance all sales, A/R and inventory transactions. You should have a printed document to back up every transaction that is reported on the Daily Balancing Report. The exceptions would be only the miscellaneous cost adjustments made through Accounts Payable Input - Match Receivings. Once balanced and all transactions are accounted for, these 2 reports (with all the backup documentation) should be filed and the day s business should immediately be closed by running the Close Day program The Close Day program closes the date. Running the Close Day program closes your ability to input the transaction s balanced date. It does not affect your ability to post to the general ledger. It only affects sales and A/R programs. To post sales to the G/L, use the Daily Balancing Report program located in the G/L module. This program will post sales and all the other associated transactions to the general ledger. Once the Daily Balancing Report program has been run you absolutely cannot change anything about the figures that have been posted. Requires setup in General Ledger Mapping Maintenance prior to being run. Recommendations: 1. Always insist that you get a back-up copy of every transaction that appears on the DBR. 2. Create a procedure to process refunds to ensure that both the ARI entry and Banking entry are posted on the same date. 3. Do not allow anyone to take the filed balanced packets. PROC & PPR -18

19 WEEKLY ACCOUNTS PAYABLE REPORT - located in the A/P module - used to decide which invoices to disburse. PAYABLE DISBURSEMENTS - located in the A/P module - allows you to choose which invoices you wish to pay. PAYABLES DISBURSEMENT REPORT - located in the A/P module - a listing of all invoices which you have flagged "payable" through PDI. ACCOUNTS PAYABLE CHECKS - located in the A/P module - used to print continuous form checks. SALES ANALYSIS REPORT - located in the Sales module - used to examine what is selling on any given day or date range. SALES ORDER REPORT - located in the Sales module - used to print out a listing of all delivered sales orders with debit or credit balances. PURCHASE ORDER REPORT - located in the Merchandising module - allows you to monitor all your open purchase orders. PROC & PPR -19

20 MONTHLY Always keep on file reports used to Post to the G/L as well as the reports to balance *BALANCE G/L TO A/P - located in the Balancing module - used to balance to the g/l. *BALANCE G/L TO CASH - located in the Balancing module - used to balance to the g/l. *BANK RECONCILIATION USING REGISTER - located in the Banking module - used to do bank reconciliation so that the system's check register balances with your bank's statement. *BANK RECONCILIATION REPORT - located in the Banking module - allows you to view and edit whatever you cleared or posted via Bank Reconciliation mode. *BALANCE G/L TO A/R - located in the Balancing module - used to balance Accounts Receivable to the General Ledger. *BALANCE G/L TO INVENTORY - located in the Balancing module used to balance Inventory to the General Ledger. *INVENTORY COST REPORT located in the Inventory module - Reports, in detail, physical inventory quantities and cost. *LEDGER REPORT - located in the G/L module used to print a detailed general ledger report. Used to assist in balancing. *DAILY BALANCING REPORT - located in the G/L module - used to post sales, COGS, etc. to the G/L at the end of the month. *TRIAL BALANCE REPORT - located in the G/L module - used to verify that all accounts are in balance. FINANCIAL STATEMENTS - located in the G/L module - Run financials and verify they are in balance. Remember that to balance a Balance Sheet your Assets must equal your Liabilities plus your Capital. Debit side must equal the Credit side. COMMISSION REPORT - located in the Sales module - used to report on commissions. DEMOGRAPHICS ANALYSIS REPORT - located in the Sales module - used to analyze written or delivered business by Zip Code, Advertising Code or Follow up Code. NOT AVAILABLE INVENTORY REPORT - located in the Inventory module - listing of inventory that has been moved into a "Not Available for Sale" status. CLOSE MONTH located in the G/L module - Use to close an accounting month. Only run close month after all posting and balancing to the general ledger has been completed. * Reports used to Balance to the General Ledger PROC & PPR -20

21 BALANCING TO THE GENERAL LEDGER AT THE END OF MONTH * Always keep on file reports used to Post to the G/L as well as the reports to Balance. BEFORE YOU START Before you start to balance, it s always a good idea to run a complete re-index first. Make sure all posting reports have been run. 1) BALANCING ACCOUNTS PAYABLE Use Balance G/L to A/P Report The totals on the report should match. If they do not: 1) Check to make sure the Purchase Journal Report was run to post all entries for accounts payable. 2) Run a detailed Ledger Report to review for incorrect entries. 3) Run the Accounts Payable report and review for problems. 2) BALANCING ACCOUNTS RECEIVABLE Use Balance G/L to A/R Report The totals on the report should match. If they do not, there are several things to check. These include 1) Bank Deposits 2) General Ledger Mapping Maintenance 3) Misc. Transactions keyed in through Misc. Transaction Input. 4) Run a detailed Ledger Report to review incorrect entries. 3) BALANCING THE CASH ACCOUNTS Use the Balance G/L to Cash Report The totals on the report should match. If not in balance: 1) Start by checking to see if any manual journal entries have been made to affect the account and that all bank deposits were made correctly. 2) Run a detailed Ledger Report to review incorrect entries. 4) BALANCING INVENTORY Use the Balance G/L to Inventory Report The totals on the report should match. If they do not: 1) Review the inventory and sales mappings setup in General Ledger Mapping Maintenance. 2) Make sure the codes are being used correctly. 3) Make sure that the A/P invoices are being posted correctly. 4) Run a detailed Ledger Report to review for incorrect entries. PROC & PPR -21

22 Balance Cash to G/L The Balancing Report will show the Cash, General Ledger and Subsidiary figures. It will also show any problem entries that will cause the two to be out of balance. Date Range: Always enter the date range for the month you are balancing. G/L Cash Accounts Used: These are the G/L accounts that have been flagged as Cash Accounts in Chart of Accounts Maintenance. By flagging the accounts, it lets the system know which G/L accounts to use when balancing. Total Bank Balance: This is a net total of all the debits and credits posted in the Banking module. This is the Subsidiary to the G/L. This balance is from the beginning of time through the date range the report was run. It is not Month to Date. Total GL Balance: This balance is the net total of all the debits and credits posted to the G/L. This balance is from the beginning of time through the date range the report was run. It is not Month to Date. The Net Change to the Cash subsidiary and G/L should match. The Balance should be zero. This would mean that all entries posted to the Bank Account were also posted to the G/L. Net Change to Bank Within Period: Reports the NET total of all the Banking Transactions that have been posted through the register within the date range the report was run. Net Change to G/L Within Period: This is the NET of the debits and credits that have been posted to the Cash G/L account within the date range the report was run. The Net Change Within Period to Cash and the G/L should Match. The net balance should be zero. Following are mismatches between the Bank Register & the G/L Cash Account within the above Date Range: This section reports Banking Transactions that have not been posted. It will also show any manual journal entries posted to the Cash G/L account. Bank or G/L ID: Journal entry # Reference: Reference field from banking transactions Check #: Check number, if applicable Date: Post Date Transaction Type: Type of transaction: Deposit, Check, etc. Bank $$: Amount posted to Banking Transaction G/L $$: Amount posted to the General Ledger PROC & PPR -22

23 Balancing A/P to G/L The balancing report will show the A/P General Ledger and subsidiary figures. Date Range: Always enter the date range for the month you are balancing. The Balancing Report will show whether the A/P subsidiary and General Ledger figures are in balance. When you are not in balance, it also reports any problem entries that will cause the two to be out of balance. G/L A/P Accounts Used: These are the G/L accounts that have been flagged as Accounts Payable in Chart of Accounts Maintenance. By flagging the accounts, it lets the system know which g/l accounts to use when balancing. Total A/P Balance: This is a net total of all the A/P invoices and credits that are currently open in the system. This balance is from the beginning of time through the date range the report was run. It is not Month to Date. Total G/L Balance: This balance is the net total of all the debits and credits posted to the G/L. This balance is from the beginning of time through the date range the report was run. It is not Month to Date. The Net Change to the A/P subsidiary and G/L should match. The Balance here should be zero. This would mean that all entries posted to the A/P were also posted to the G/L. Net Change to A/P within Period: This is the total of all Accounts Payable invoices and chargebacks that have been posted and paid in A/P within the date range the report was run. Net Change to G/L within Period: This is the net of the debits and credits that have been posted to the Accounts Payable G/L account within the date range the report was run. Net Change: This report will not balance to the Accounts Payable Report. The information listed below explains why. These figures would need to be adjusted into the Accounts Payable Report for this report and the Accounts Payable Report to balance. AMOUNTS NOT REPORTING ON THE ACCOUNTS PAYABLE REPORT Invoices Voided after Ending Date: This figure represents the total amount of invoices that have been voided after the ending date. Example: if you run the report for a date range of 3/1/01 3/31/01, the report would show you invoices voided after 3/31/01. Invoices Paid before their Posted Date: This figure represents the total amount of invoices that have been paid before the date they were posted. Example: the invoice was input with a posted date of 2/1/01, but paid on 1/31/01. Your G/L balance as of 1/31/01 would include a Debit to A/P, but the Subsidiary Report would not include the invoice. Therefore, it would show as out of balance by the debit amount on the ledger. Unposted Invoices before Ending Date: This figure represents the total amount of un-posted invoices prior to the ending date. Example: if you run the report for a date range of 3/1/01 3/31/01, the report would show you any invoices that have not been posted prior to 3/31/01. PROBLEM ENTRIES Following are mismatches between the A/P Invoices & the G/L A/P Accounts within the above Date Range: This section reports A/P invoices that have not been posted. It will also show any manual journal entries as well as manual checks posted to the A/P G/L account where no invoice was referenced. PROC & PPR -23

24 A/P or G/L ID: Journal entry # Vendor: Vendor Code if applicable Invoice #: Accounts Payable Invoice # Date: Post Date Reference: Reference field from banking transactions A/P $$: Amount posted in Accounts Payable Input G/L $$: Amount posted to the General Ledger Balance A/R to G/L The A/R to G/L balancing report is used to report A/R general ledger and A/R subsidiary figures. It will show if the 2 accounts are in balance. Date Range: Always enter the date range for the month you are balancing. The Balancing Report will show whether the A/R subsidiary and General Ledger figures are in balance. When you are not in balance, it also reports any problem entries that will cause the two to be out of balance G/L A/R Accounts Used: These are the G/L accounts that have been flagged as Accounts Receivable in Chart of Accounts Maintenance. By flagging the accounts, it lets the system know which G/L accounts to use when balancing. If you have both an Accounts Receivable and a Customer Deposit Account, both would need to be flagged as Accounts Receivable in the Chart of Accounts Maintenance Program. Message: The following Sales Orders had mismatches between the Sales Order & A/R: This section will show any sales order, customer return, adjustment or service order that has been finalized where there is no A/R record. When the program is run in the update mode, it will fix these records automatically. Message: The following A/R records do not have a corresponding Sales records. The transaction type needs to be changed: This section reports sales, adjustments, customer returns or service transactions that have been input into Miscellaneous A/R input. These records will need to be corrected manually. Total A/R Balance: This is a net total of all the A/R debits and credits on customer accounts. The Subsidiary to the G/L: This balance is from the beginning of time through the end date the report was run. It is not Month to Date. Total G/L Balance: This shows the net total of all the debits and credits posted to the G/L. This balance is from the beginning of time through the end date the report was run. It is not Month to Date. The Net Change to the A/R subsidiary and G/L should match. The Balance here should be zero. This would mean that all the entries that were posted to the customer accounts were also posted to the G/L. PROC & PPR -24

25 Net Change to A/R Within Period: This figure represents the net of the debits and credits that have been posted to customer accounts within the date range the report was run for. Net Change to G/L Within Period: This is the net of the debits and credits that have been posted to the Accounts Receivable G/L account within the date range the report was run for. The Net Change to the A/R subsidiary and G/L within the period should match. The Balance here should be zero. This would mean that all the entries that were posted to the customer accounts were also posted to the G/L within the date range the report was run. Last time Posted to the G/L: Provides the last time the G/L Daily Balancing Report was run in the update mode. The G/L A/R Balancing Report: Not Mapped: Mapped: Not Mapped is a list of all the Deposit and Payment transactions, and in some cases, Miscellaneous A/R transactions that are not mapped to the G/L in the General Ledger Mapping Maintenance Program. The Mapped columns are a list of all the transactions that are mapped to the G/L in the General Ledger Mapping Maintenance Program. These columns will only balance after the G/L-Daily Balancing Report program has been run in the update mode. Ultimately the A/R $$ and the G/L $$ columns should match, extending to a Running balance of 0.00 each day. This would conclude that every transaction that was input affected the general ledger. If the running balance for any day is not equal to zero, on that date there is a problem. Balance Inventory to G/L The Balance Inventory to G/L report is used to report Inventory general ledger and Inventory subsidiary figures. It will show if the 2 accounts are in balance. Date Range: Always enter the date range for the month you are balancing. The Balancing Report will show whether the Inventory subsidiary and General Ledger figures are in balance. When you are not in balance, it also reports any problem entries that will cause the two to be out of balance G/L Inventory Accounts Used: G/L accounts that have been flagged as Inventory in Chart of Accounts Maintenance. By flagging the accounts, it lets the system know which G/L accounts to use when balancing. Total Inventory Balance: This is the net total of all the Inventory in the system. This balance is from the beginning of time through the end date the report was run. It is not Month to Date. Total Inventory G/L Balance: This balance is the net total of all the debits and credits posted to the G/L. This balance is from the beginning of time through the end date the report was run. It is not Month to Date. Net Change to the Inventory subsidiary and G/L should match. The Balance here should be zero. This means that for all the inventory that has been received or sold, there has also been corresponding journal entries posted to the general ledger. PROC & PPR -25

26 Net Change to the Inventory Within Period: This it the net total of all Inventory that have been received or sold within the date range the report was run. Net Change to G/L Within Period: This is the net of the debits and credits that have been posted to the Inventory G/L account within the date range the report was run. Net Change Within Period to the Inventory and G/L should match. The Balance of both accounts should net to zero. This means that within the date range the report was run for, all the inventory that have been received or sold, there has also been corresponding journal entries posted to the general ledger. Last time Posted to the G/L: This date represents the last time the G/L Daily Balancing Report has been run in the update mode. This report posts the credits to the inventory accounts for items that have been sold. Vendor: Vendor Code Invoice #: Accounts Payable Invoice # Date: Invoice Post Date Current Period Book: Invoice amounts posted in the current period Prior Period Book: Invoice amounts posted in the previous period Current Period Receivings: Inventory receivings posted in the current period Prior Period Receivings: Inventory receivings posted in the prior period Current Period Book/Receiving Difference: Difference between Invoice posted amounts and inventory receivings. (1) Debits to Inventory The debits to the G/L are posted through A/P. The debits to the physical are posted through receiving. (2) Credits to Inventory The credits to the G/L are posted through the Daily Balancing Report in the G/L update mode. The credits to the physical are posted when sales are finalized. (3) Mapped Adjustments Adjustments made to the physical inventory where a code that has been mapped to update the general ledger was used. (4) Un-Mapped Adjustments Adjustments made to the physical inventory where a code that has NOT been mapped to update the general ledger was used. The Following A/P Invoices have been voided. They were either posted in a previous period & voided in this period or posted this period and voided in a future period. Either way they have affected the G/L and not the Physical Inventory. They are printed here to aid in balancing purposes only. Vendor: Vendor Code Invoice: Invoice # Book Amount: Inventory G/L Amount PROC & PPR -26

27 YEARLY ACCOUNTING PERIOD MAINTENANCE - located in the G/L Module - Used to set up new year accounting period. INVENTORY COST REPORT - located in the Inventory Module - Lists inventory by location with cost and freight. CLOSE MONTH Used to Close and Lock a month s G/L accounting period. This function closes your ability to post to the G/L for that particular month. END OF YEAR - located in the G/L Module This program is used to close out a fiscal year and move the balances for your assets, liabilities, and equity accounts to your new fiscal year file. These balances will automatically be entered into the first day of your new fiscal year as part of the process when running this program. The report screen will require you to input a Retained Earnings account number. This figure will be calculated on Total Income minus Total Expense. The Income and Expense accounts will begin the year with a zero balance where the Assets, Liabilities, and Capital accounts will move over with a balance carried forward. NOTE: YOU MUST RUN CLOSE MONTH BEFORE YOU RUN END OF YEAR! TRAIL BALANCE REPORT - usually run at the month end and year-end to make sure the postings to each G/L account balance. PROC & PPR -27

28 X. Miscellaneous Procedures A. MAKING PAYMENTS There are several places to make payments. The important thing to remember when making payments is to always reference the Original Sales Order Number. Note: Payments do not affect the G/L. When you make your bank deposits is when you will debit the Cash account and credit the A/R account. 1. Payment Input or Multiple Payment Input Used to input payments. To credit multiple invoices or accounts using one check or payment use MPRI. 2. Sales Orders Normally used in the receipt mode to take deposits or down payments, unless you are applying the payment to a Revolving or Installment Account. Then use Payment Input. 3. Customer Account Lookup Payments can also be entered through this screen, as can misc. A/R transactions. 4. Miscellaneous Transaction Input Used to input miscellaneous A/R transactions. Example: Restocking fee, NSF fee. PROC & PPR -28

29 B. TRADE If you sell merchandise for trade, key in the sales order as usual. In A/R Miscellaneous Code you will need to setup a code for TRADE MERCHANDISE. Then go into Miscellaneous Transaction Input and key in the credit transaction (a negative amount) for the entire amount of the sale using the Trade Merchandise A/R code. You will also need to map the code you setup in Code Maintenance. In General Ledger Mapping Maintenance under receivable codes, select the code you created and map it to Debit the A/R account and Credit your Trade account. If the trade hasn't been used and you want to track that you have a trade credit, go into Accounts Payable Input and key in the dollar amount of the credit as negative figure and at the Invoice #, key in the Trade Credit. This credit can then be disbursed against an actual invoice in the future. Steps to Set up and Use: 1) Set up a G/L chart of account number for Trade. Set up as an asset. 2) In Code Maintenance, set up a Misc. A/R code for Trade 3) Map the Trade Code in General Ledger Mapping Maint. Debit A/R and Credit Trade G/L account. Since the entry will be input as a negative number, it will actually be posted as a Debit to the trade G/L account. 4) Input the Sale as usual for the customer you are doing trade with. Use Misc. Trans. Input to apply a credit to their account using the Trade Merchandise code you set up in step 2. 5) Then go into Chargeback Input and input a credit for the amount of trade you applied to the customer s account. You will be crediting the Trade G/L account. 6) When you use the trade you will need to input an invoice in accounts payable input. You will need to debit the inventory or service expense account as usual. PROC & PPR -29

30 C. GIFT CERTIFICATES - PURCHASE 1. CUSTOMER PURCHASING CERTIFICATE a. Make sure when you give the customer the physical Gift Certificate that you make note of the purchasing customer s name on the Gift Certificate. This will be helpful in locating the credit when it is redeemed. The credit will exist on the purchasing customer s account, until the point it is redeemed. b. Go into Payment Input and record the payment. In the Sales Order reference field enter the text GIFT CERT. Example of Initial Payment 2. WHEN THE CUSTOMER COMES IN TO USE THE GIFT CERTIFICATE a. Input the sale as usual. b. To transfer the credit from the purchasing customer s account to the person redeeming the gift certificate, go into Transfer Dollars. c. You will transfer the amount of the gift certificate (as a positive amount) to the new sale. See Example on Next Page PROC & PPR -30

31 Example of Transfer Dollars: Chuck Jones purchased a $ gift certificate to give to Susan Myers. She has come in to redeem it and Sales Order # has been entered. D. GIFT CERTIFICATE - PROMOTIONAL 1. SETUP Go into Code Maintenance using Receivable Codes and create a code for Gift Certificate - Promo. You will also need to map this code to the general ledger in General Ledger Mapping Maintenance. You will debit A/R and credit Advertising or Promotions expense account. Remember: you will be inputting a negative figure so that when this journal entry hits the general ledger the debit and credit are reversed. 2. CUSTOMER USING PROMOTIONAL GIFT CERTIFICATE You will not record the gift certificate until it is redeemed. Do not input a credit on the customer s account until they are going to use it. Then input the sale as usual. Instead of entering a payment for the gift certificate amount, go into Miscellaneous Transaction Input. Input the amount of the gift certificate as a credit (with a negative sign), and use Gift Certificate - Promo as a transaction type. In the SO Reference field, input the sales order number to credit. PROC & PPR -31