Exact Financials (v3)

Finance Manual - Creating general ledger accounts

Creating general ledger accounts

The way in which you define the various general ledger accounts is essential to the operation of your entire accounting system. It is vital that you define your chart of accounts systematically, using logical codes for the accounts. Furthermore it is very important to distinguish clearly between balance sheet accounts and profit and loss accounts. See General ledger account.

Important aspects to consider before creating general ledger accounts

• General aspects.
• VAT accounts and VAT codes.
• Subtotal accounts and empty accounts.
• Most important general ledger accounts.

General aspects

Before you can start creating general ledger accounts, you should carefully consider the following aspects:

• The numerical coding of the general ledger accounts.
• The classification plan. See Classification plan.
• The clarity and readability of the financial statements by effective usage of subtotal accounts and empty accounts.
• The arrangement of balances on the financial statements in account form.
• The financial statement on which the balance of an account should be displayed; the balance sheet or the profit and loss statement.
• Whether an account will be included in (automatic) revaluation.
• Whether amounts entered in an account are allocated to cost centers and/or cost units.
• Whether a particular account always includes a fixed VAT code.

VAT accounts and VAT codes

When you define general ledger accounts, you are required to enter a VAT code. When you start using Exact, only VAT code '0' is available. Use the following procedure to create VAT accounts and VAT codes:

1. Start by defining the VAT accounts required ('VAT to pay' and 'VAT to claim', etc.) in [Ledger, Master data, Maintenance, General ledgers]. Enter VAT code '0' in the field 'VAT code'.
2. Then define all VAT codes in [Ledger, VAT, Master data, Maintenance, VAT codes], using the VAT accounts you have just defined.
3. Once you have defined all the VAT codes you need, you can enter all other general ledger accounts in [Ledger, Master data, Maintenance, General ledgers] and use the VAT codes created.

Most important general ledger accounts

For the financial packages, these general ledger accounts are essential:

• General ledger links

  General ledger links allow entries to be made automatically in the correct accounts. This speeds up the entry process. Before you can create general ledger links, you need to create the general ledger accounts. See Defining general ledger links.

• Debtors and creditors offset accounts

  These accounts are used to record subsidiary ledger entries such as invoices and are the default offset accounts for the sales and purchase journal respectively.

• Journals

  A default offset account is required for all journals of the following type: sales, purchase, bank and cash. When you make an entry in one of these journals, the default offset account will always be used. You only have to select the offset account. See Creating journals.

• VAT codes

  Before you can create VAT codes in [Ledger, VAT, Master data, Maintenance, VAT codes], you need to create the general ledger accounts ('VAT to pay' and 'VAT to claim') in which the VAT amounts calculated will be entered. See Creating VAT codes.

• Currencies

  Exchange rate differences in outstanding items and payments will result in profit or losses. Amounts in foreign currencies may have to be revalued if exchange rate fluctuations occur. For the entries involved, general ledger accounts should be linked to each currency in [Ledger, Currencies, Maintenance, Currencies]. See Creating foreign currencies.

• Assets

  Before you can create asset groups you should first create the necessary general ledger accounts. Then define the accounts required in [Assets menu, Master data, Maintenance, Assets, Asset groups]. See Creating asset groups.

• Cost centers and cost units

  If you are using cost allocation, you will have to link a coverage and an expense account to each cost center in [Ledger, Cost centers, Links to general ledgers, Maintenance] and [Ledger, Cost units, Links to general ledgers, Maintenance]. See Creating cost centers for a cost allocation sheet.

For the logistic packages see the relevant manual.

You can adapt your general ledger data and the way the company uses it to your own needs.

See also:

[Ledger, Master data, Maintenance, General ledgers]

Troubleshooting

Finance Manual > Contents > Creating classifications, general ledger accounts and general ledger links > Creating general ledger accounts