ERP 2.50:Configure Accounting

Contents 1 Setting up accounting 1.1 Setting up the account schema 1.2 Setting up accounting manually 1.2.1 Creating the account schema 1.2.2 Creating the accounting elements 1.2.3 Creating the account tree 1.2.4 Uploading the account file 1.2.5 Importing the accounts 1.3 Applying a reference module 1.4 Testing the accounts schema 1.5 Defining the fiscal year and accounting periods 1.5.1 Defining non-business days 1.6 Setting up financial accounts 1.6.1 Setting up "Bank" type financial account 1.6.2 Setting up "Cash" type financial accounts 1.7 Setting Financial Accounts inital balance 1.8 Negative Accounting 1.9 Disable Background For Group Of Documents 2 Accounting templates 2.1 Installing an accounting template 2.2 Applying the accounting template to an accounting schema table 2.3 Example: amortization of subsidized assets

Setting up accounting

If you intend to use Openbravo ERP for accounting, you must complete the following tasks:

• Set up the account schema.
• Set up the financial calendar.
• Set up client bank accounts.
• Set up the starting balance.

Setting up the account schema

The account schema provides the structure for your accounts in Openbravo ERP. There are two ways to implement an account schema:

• Using only the .csv file
• Using a reference data module

Setting up accounting manually

The easiest way to apply an accounting file is to upload it during the initial client setup process, because all the necessary tasks are automated. However, you can also upload the file after the initial client setup process is complete, using the Import Data function. If you choose to upload the .csv accounting files separately, you must complete the following steps:

1. Create the account schema.
2. Create account elements.
3. Create an account tree: this sets up the tables into which the data will be imported.
4. Upload the accounting files. Openbravo ERP places this data in temporary tables.
5. Import the accounts: Openbravo ERP imports the data into the correct tables.

Creating the account schema

1. Log into Openbravo ERP with the client admin role.
2. From the Application menu, select Financial Management > Accounting > Setup > Accounting Schema.
3. Click New.
4. The Organization field is populated by default.
5. In the Name field, give the account schema a name.
6. In the Description field, type a brief description of the account schema if required.
7. From the GAAP list, select the accounting rules you want to use. For most enterprises, US GAAP is suitable.
8. From the Currency list, select the currency you want to use for this accounting schema.
9. To allow negative transaction values in transaction reversal, select Allow negative. Clear the checkbox to ensure that debits and credits are reversed with positive values. Note that you can override the schema setting at document type level.
10. Click Save.

Creating the accounting elements

After creating the account schema, you must now manually create the five schema elements that are created automatically in the initial setup process. The automated process creates the following elements:

• Account
• Organization
• Business Partner
• Product
• Project

However, you can create additional or different elements to suit your business requirements, as described below. The Account and Organization elements are mandatory.

1. Log into Openbravo ERP with the client admin role.
2. From the Application menu, select Financial Management > Accounting > Setup > Accounting Schema.
3. In grid view, select the schema you created in the previous task.
4. Go to the Account Schema Element tab and create a new one.
5. In the Name field, type Account.
6. Select the Balanced and Mandatory checkboxes.
7. From the Accounting Element list, select the account schema you created in the previous task.
8. Click Save and New. A new record appears.
9. In the Name field, type Organization.
10. From the Type list, select Organization.
11. Select the Mandatory checkbox.
12. Click Save and New. A new record appears.
13. In the Name field, type Business Partner.
14. From the Type menu, select Bus. Partner.
15. Click Save and New. A new record appears.
16. In the Name field, type Product.
17. From the Type menu, select Product.
18. Click Save and New. A new record appears.
19. In the Name field, type Project.
20. From the Type menu, select Project.
21. Click Save.

Creating the account tree

1. Log into Openbravo ERP using the Client admin account.
2. From the Application menu, select Financial Management > Accounting > Setup > Account Tree
3. Click New. A new account tree record appears:
4. In the Name field, give the account tree a name.
5. From the Type menu, select Account.
6. From the Tree menu, select client name ElementValue (Account, etc.) where client name is the name of your client. For example if the client name is MyCompany the menu option would read MyCompany ElementValue (Account, etc)
7. Click Save.

Uploading the account file

1. Log into Openbravo ERP using the Client admin account.
2. From the Application menu, select Master Data Management > Import Data > Import File Loader.
3. Click Browse. From the dialog box that opens, select the .csv file you want to import.
4. Click Open.
5. From the Format File menu select Accounting - Accounts.
6. If the .csv file has header information (e.g. column headings) as the first line, select Header First Line. Clear the Header First Line checkbox if the .csv file consists only of the accounts data.
7. Click OK.
8. Details of the accounts to be imported appear in the lower half of the window.
9. Click Process.

Importing the accounts

Note: in Openbravo 3, you need to install Import Data module (https://forge.openbravo.com/projects/importdata) which contains traditional import data processes that, in previous versions, were part of core.

1. Log into Openbravo ERP using the Client admin account.
2. From the Application menu, select Master Data Management > Import Data > Import Account.
3. Click New.
4. From the Client menu, select your client.
5. From the Accounting Element menu, select the name of the account tree that you have just created.
6. In the Name field, type a name for the import process.
7. In the Search key field, type a short expression that you can use for this import process.
8. Click Import Accounts. Openbravo imports the account schema information into the database tables.

Applying a reference module

To install accounts using a reference module downloaded from the Openbravo repository, follow these steps:

1. Log into Openbravo ERP as System Administrator.
2. From the Application menu, select General Setup > Application > Module Management. The Module Management Console displays.
3. Select the Add Modules tab.
4. To search for a particular module, enter your search terms and click Search. Alternatively, to view a full list of available modules, click View All.
5. The list of modules appears. To find out more about each module, click View Details.
6. For the module you want to install, click Install Now. A confirmation window appears with the details of your chosen module.
7. To continue installing the module, click Continue. To abort the installation, click Cancel.
8. The license agreement for the module appears. Select I accept all license agreements to accept the license agreement.
9. Click Continue. A message appears when the installation is complete.
10. Repeat the installation procedure for any further modules that are required.
11. In General Setup > Application > Module Management, select the Installed Modules tab. All the modules currently installed on the system appear in a list.
12. Click Rebuild Now. The Apply Modules window appears, showing the progress of the rebuild.
13. When the rebuilding process is complete, log out of Openbravo ERP.
14. Access the Tomcat server management page. If you are working on the machine where Openbravo ERP is installed, you can access the page by typing http:localhost:8080/manager/html into your web browser. If you are accessing Openbravo ERP from a remote location or through a virtual machine, use the URL http:IP_address/manager/html, where IP_address is the IP address you use to access Openbravo ERP. A password box is displayed.
15. Type the username and password for the Tomcat server. By default these are:
    • Username:admin
    • Password:openbravo
16. Scroll down to the Openbravo context and click Reload.
17. Click OK to confirm that you want to reload the context.
18. Start Openbravo ERP and log in in the usual way.

As well as downloading modules from Openbravo, you can create them in-house or aquire them from other community users. To learn more about the possibilities that modularity offers, see Modularity.

Testing the accounts schema

If you uploaded an accounting schema while creating a client, you can verify that the Accounting Schema import has been correct.

1. From the Application menu, select Financial Management > Accounting > Setup > Accounting Schema.
2. The accounting schema you have uploaded is displayed.

Defining the fiscal year and accounting periods

For accurate accounting it is important to define the start and end of the financial year and specify how the year is divided into periods.

1. From the Application menu, select Financial Management > Setup > Fiscal Calendar.
2. Click New.
3. In the Organization field, select the organization that will use the calendar. If you want the calendar to apply to all organizations within the client, select *.
4. In the Name field type the name of the new calendar, for example Accounting Calendar
5. In the Description field type a brief description of the calendar if required.
6. To make the calendar applicable immediately, select the Active checkbox.
7. Click Save.
8. Create a New Record under Year tab.
9. In the Fiscal Year field, type the name of the fiscal year for example 2011.
10. Click Save.
11. To automatically create 12 standard accounting periods for the year, click Create Periods. A confirmation box appears to confirm the creation of the periods.
12. Alternatively, to create custom accounting periods, navigate to the Period tab.
13. Click New. A new period record appears.
14. In the Period Nº box type the period number.
15. In the Name field tye the period name.
16. Specify the Starting date and Ending date of the period.
17. Click Save.
18. Continue to add periods until you have defined the whole year.

Defining non-business days

Non-business days can affect when an invoice (either a sales or purchase invoice) is payable. For example, the terms of an invoice can state that it is payable within 30 working days. It is therefore important do set up non-working days correctly so that invoices are paid on time.

1. From the Application menu, select Financial Management > Accounting > Setup > Fiscal Calendar.
2. Navigate to the Non-business Day tab.
3. Create a new record. A new non-business day record appears.
4. In the name field, specify a name for the non-business day, for example Christmas Day
5. In the Non Busines Day Date box, specify a date for the non-business day or select it from the calendar.
6. Click Save.

Setting up financial accounts

Each client and organization can have accounts with more than one financial account, a financial account can be:

• "Bank" type.
• "Cash" type.

Setting up "Bank" type financial account

1. Log into Openbravo ERP with an Admin role.
2. From the Application menu, select Financial Management > Receivables and Payables > Transactions > Financial Account.
3. Click New.
4. Select the Organization for which the financial account needs to be created.
5. In the Name field, type the name of the bank.
6. Select the Currency to be used in that bank.
7. In the field "Type" select Bank.
8. To make the bank immediately visible and available for selection, select Active. Alternatively, clear the Active checkbox to deactivate the bank.
9. In the Location / Address field, click the Address icon . The Location Selector box appears.
10. Type the address and location details for the bank.
11. Click OK to close the Location Selector box and return to the bank record.
12. In the Business Partner field select a Business Partner from the list. If you intend to use remittances, you must set up the bank as a business partner and select the business partner here.
13. If the bank account number is in a Spanish format, you must specify the following:
    • Bank code
    • Branch code
    • Bank Control Digit
    • Account Control digit.
    • PartialAccount Nº
14. If the bank has an INE number, type it in the INE box.
15. If required, type the IBAn code in the IBAN Code box.
16. Click Save.

Navigate to the "Accounting Configuration" tab. The system will show the "Defaults" ledger accounts taken from the Accounting Schema Defauls as applicable.

Navigate to the Payment Method tab and select all the payment methods which are going to be allowed for that Financial Account, and change the accounting configuration as applicable for any "Payment In" and/or "Payment Out" transactions.

Setting up "Cash" type financial accounts

1. Log into Openbravo ERP with an Admin role.
2. From the Application menu, select Financial Management > Receivables and Payables > Transactions > Financial Account.
3. Click New.
4. Select the Organization for which the financial account needs to be created.
5. In the Name field, type the name of the cash.
6. Select the Currency to be used in that cash.
7. In the field "Type" select Cash.
8. To make the cash financial account immediately visible and available for selection, select Active. Alternatively, clear the Active checkbox to deactivate the bank.
9. Click Save.

Navigate to the "Accounting Configuration" tab. The system will show the "Defaults" ledger accounts taken from the Accounting Schema Defauls as applicable.

Navigate to the Payment Method tab and select all the payment methods which are going to be allowed for that Financial Account, and change the accounting configuration as applicable for any "Payment In" and/or "Payment Out" transactions.

Setting Financial Accounts inital balance

Because in most cases, the business is already up and running at the time Openbravo ERP is implemented, the next stage of configuration is to set up the inital balance of each financial account.

While you are creating your financial accounts (bank/cash type financial accounts), it is required to fill in one field named "Inital Balance". The "Initial Balance" field must be filled in with the current balance of your bank / cash financial account. Once saved, it will not be possible to manually update it anymore.

Financial Account current balance is calculated as the sum of the initial balance and every financial account transactions.

Negative Accounting

Negative accounting affects the way that reversals are accounted, and is set up as part of the accounting schema. When you reverse a transaction you can use either negative or positive values. For example, if a sales invoice document generates the following transactions lines:

GL	Line Type	Debit	Credit
Debtor	Sales Invoice	1,000	0
Revenue	Sales Invoice	0	1,000

If the Allow Negative option is selected, when the transaction is reversed, the system will allow the creation of the following negative transaction lines. Using negative lines for reversals is sometimes called storno accounting.

GL	Line Type	Debit	Credit
Debtor	Sales Invoice	-1,000	0
Revenue	Sales Invoice	0	-1,000

However, in some countries, negative entries are not accepted by auditors, in which case the correct way to reverse the transaction would be as follows:

GL	Line Type	Debit	Credit
Debtor	Sales Invoice	0	1,000
Revenue	Sales Invoice	1,000	0

Negative transaction lines are considered best practice in some countries, particularly in Central and Eastern Europe. These include (but are not limited to):

• Czech Republic
• Poland
• Romania
• Russia
• Slovakia
• Ukraine

In most countries negative transaction lines are not looked upon favorably by auditors and the expectation is that transactions are reversed using contra accounting. These countries include (but are not limited to):

• Spain
• United Kingdom
• United States

Because both types of transaction reversal are legitimate (in the correct accounting context), you can configure Openbravo ERP to suit your locale and preference.

The default behavior of reversing transactions is controlled by the accounting schema. For countries where transaction reversal using negative values is not normally used, make sure that the Allow negative option in Financial Management > Accounting > Setup > Accounting Schema not selected.

However, you can also override the schema behaviour at document type level, for example to allow negative accounting for particular accounting documents. This gives complete control to the implementer in defining the transaction reversal behaviour for each combination of schema and document type.

Note: in earlier versions of Openbravo ERP negative transactions were enabled by default.Users upgrading to Openbravo 2.50 from earlier versions will find the Allow negative option selected. It is recommended that you consider reconfiguring their systems to take advantage of the increased options for managing transaction reversals. In Openbravo ERP 2.50 the default behavior is to not allow negative transactions. In new implementations of Openbravo ERP, the Allow Negative option is deselected by default. This means that the default behavior for transaction reversal will be to use contra accounting, i.e., to disallow negative transactions unless they are specifically enabled at a schema or document level.

See an example of reverse transaction using Openbravo ERP in this blog post.

Disable Background For Group Of Documents

Groups of documents can be disabled for accounting by deactivating its table entry inside Financial Management > Accounting > Setup > Accounting Schema > Accounting Schema Tables. That will result in all the documents associated to that table not to be posted. From 2.50 MP22 on, groups of documents can as well be deactivated for background posting. Using "Disable for Background" flag we can disable a group of documents inside Financial Management > Accounting > Setup > Accounting Schema > Accounting Schema Tables. That way system will not post them automatically but user can do manual posting for those documents.

Accounting templates

Accounting templates enable you to override established accounting behaviour at organization or at document level by installing an extension module. You could use an accounting template to extend the default accounting behaviour used to post depreciation of assets in order to post both the asset depreciation and the corresponding amortization of a grant used in acquiring that asset. You can download and install an accounting template from the central repository in the same way as other modules, and then implement it at system level. Once you have implemented the template you can assign it to specific accounting schema tables or documents. Accounting templates can also include additional windows, tabs and fields, just like any other module.

Accounting templates are available from version 2.50 MP1 onwards

Installing an accounting template

1. Log into Openbravo with a Systems Administrator role.
2. From the Application menu, select General Setup > Application > Module Management.
3. Click Add Modules.
4. Either navigate to the module you require from the central repository or click Browse File System if the template is stored on your computer. Take note of the java package name of the module.
5. Click Install Now.
6. Accept the license agreement and click Continue.
7. When the installation process has finished, click Rebuild Now to rebuild your system.
8. When the system has rebuilt, follow the on-screen instructions to restart the Tomcat server.

You can check that the module has been installed and is available in Financial Management > Accounting > Setup > Accounting Templates.

Applying the accounting template to an accounting schema table

Once you have installed the template, you must apply it to the appropriate schema tables:

1. Log into Openbravo ERP with a client admin role.
2. From the Application menu, select Financial Management > Accounting > Setup > Accounting Schema
3. Select the Account Schema Tables tab.
4. In grid view, select the schema table you require.
5. From the Accounting template list, select the accounting template you want to apply to the account schema table.
6. Click Save.
7. Repeat the process to apply the accounting template to further schema tables.

Example: amortization of subsidized assets

The AmortizationSubsidy accounting template enables more accurate accounting when dealing with the amortization of a subsidy associated with an assets. For example, if government subsidy is available for the purchase of IT equipment, the AmortizationSubsidy module enables you to create to create amortization postings at the same time that the corresponding depreciation transaction is created.

Without implementing the new account template, depreciation of an asset would follow the following workflow:

1. Log into Openbravo ERP with a client admin role.
2. From the Application menu, select Financial management > Assets
3. Click New.
4. Select the Depreciate checkbox.
5. Set the annual depreciation to 10%
6. In the Purchase date field, specify a purchase date.
7. In the Depreciation start date field, specify the same date as the purchase date.
8. In the Asset value field, set the asset value to 5000EUR.
9. Click Create Amortization.
10. From the Application menu, select Financial Management > Assets > Amortization
11. Double-click the depreciation record you have just created.
12. Process the amortization and post it. The accounting entry is as follows:

Account No	NAME	DEBIT	CREDIT
68200	Amortización del inmovilizado material	500.00	-
28290	Amortización acumulada de otro in(...)	-	500.00

Now, install the AmortizationSubsidy accounting template (remember you must be logged in as System Administrator to install modules).

1. From the Application menu, select Financial Management > Accounting > Setup > Accounting Schema
2. Select the Account Schema Tables tab.
3. Select the FinancialMgmtAmortization table.
4. From the Accounting Template list, select AmortizationSubsidy.
5. Click Save.
6. From the Application menu, select Financial Management > Assets > Subsidizer Entity
7. Click New.
8. In the Search key field, type subsid.entity1.
9. In the Name field, type subsid.entity1.
10. Click Save.
11. Select the Accounting tab.
12. In the Subsidy and Subsidy Revenue fields, select Account 13200.
13. Click Save.
14. From the Application menu, select Financial Management > Assets
15. Click New
16. Fill in the fields as follows:
    • Asset: asset1
    • Subsidizer Entity: subsid.entity1
    • Percentage Due: 50 %
17. Click Save.
18. From the Application menu, select Financial Management > Assets > Amortization.
19. In grid view, double click on the amortization record you have just created.
20. Click Unpost.
21. Click Post. The account posting is as follows:

AccNo.	NAME	DEBIT	CREDIT
68200	Amortización del inmovilizado material	500.00	-
28290	Amortización acumulada de otro in(...)	-	500.00
13200	Ingresos derivados de derechos so(...)	250.00	-
13200	Ingresos derivados de derechos so(...)	-	250.00

The subsidy has been taken into account in the amortization calculations.

Documentation about the way to create your own accounting templates is available here.

Category: Configure your Enterprise