RisingERP - Jouirnal Entry

Journal Entry Management

In the realm of RERP , a Journal Entry stands as a comprehensive record made in the general ledger, signifying the affected accounts within the system.

A Journal Entry in RERP serves as a versatile transaction, allowing the selection of debit and credit accounts for various purposes. All accounting entries, excluding Sales and Purchase transactions, are executed through the Journal Entry. This standard accounting transaction significantly impacts multiple accounts, ensuring that the sum of debits equals the sum of credits. The Journal Entry plays a pivotal role in influencing the primary ledger.

Journal Entries in RERP find application in various scenarios, including entering expenses, managing opening entries, processing contra entries, handling bank payments, managing excise entries, and more. For instance, it is instrumental in recording running expenses, direct expenses like fuel/transportation, sundry expenses, adjustment entries, and invoice adjustments.

To access the Journal Entry list in RERP, navigate to:

Home > Accounting > General Ledger > Journal Entry

1. How to Create a Journal Entry

1. Go to the Journal Entry list and click on New.
2. The default Entry Type is 'Journal Entry,' serving as a general-purpose entry type. Refer to section 3 for more entry types.
3. You can modify the Posting Date.
4. Expand the table, choose an Account from which the amount is debited.
5. The above details can be added using a Journal Entry Template with the 'From Template' field.
6. Specify the Party Type and Party if it's a Debtor entry.
7. Add a row where the amount will be credited.
8. Ensure that the total debit and credit amounts add up to be the same.
9. Save and Submit.

1.1 Quick Entry

While creating a Journal Entry, a Quick Entry button on the top right eases the process. Enter the amount, select the accounts, add a remark, and this will populate the 'Accounting Entries' table with the selected details.

2. Features

2.1 Accounting Entries

1. Accounting Dimensions: Link a Project or Cost Center to track costing separately.
2. Bank Account No: If a Bank Account is added, the associated number will be fetched.
3. Reference Type: Associate the Accounting Entry with another transaction using the Reference Type and selecting a specific document.
4. Is Advance: For advance payments by a Customer, set this option to 'Yes,' linking the Journal Entry to the transaction selected in the 'Reference Name' field.

2.2 Reverse Journal Entry

In any submitted Journal Entry, a dedicated button allows the reversal of the Journal Entry. By clicking the 'Reverse Journal Entry' button, a new Journal Entry is created, reversing debit and credit amounts against the respective accounts.

2.3 Difference Entry

The “Difference” represents the remaining amount after summing all debit and credit amounts. In a double-entry accounting system, the total debit should equal the total credit. If the Journal Entry is to be “Submitted,” and the difference is not zero, clicking on “Make Difference Entry” automatically adds a new row with the required amount to balance the totals.

2.4 Referencing

Manual entry of a Reference Number and setting a Reference Date is possible. These details, when entered, generate a 'Remark,' offering additional information for reference purposes.

2.5 Multi-Currency Entries

If the selected accounts have different currencies, enabling the 'Multi Currency' checkbox allows the selection of foreign currencies in the Journal Entry. This feature displays the different currencies and fetches the 'Exchange Rate.'

2.6 Journal Entry Template

Choosing an option in the 'From Template' field loads details from a Journal Entry Template, including Entry Type, Company, Series, Accounts in Accounting Entries, and an 'Is Opening' flag.

2.7 Print Settings

1. Pay To / Received From: The entered name is visible in the Sales Invoice and is useful for printing cheques.
2. Letterhead: Facilitates printing the Journal Entry on the company's letterhead.
3. Print Headings: Allows the customization of Journal Entry titles for printing purposes.

2.8 More Information

1. Mode of Payment: Specifies the payment method, such as Wire Transfer, Bank Draft, Credit Card, Cheque, or Cash.
2. Is Opening: Marks the Journal Entry as an 'Opening Entry.'
3. From Template: When a template is selected, the 'Accounting Entries' table is emptied before loading accounts from the template.

3. Journal Entry Types

Let's explore some common accounting entries that can be executed via Journal Entry in RERP:

3.1 Journal Entry

1. Example: Expenses (non-accruing)
2. Debit: Expense Account (e.g., Fuel expense).
3. Credit: Bank or Cash Account.

3.2 Inter-Company Journal Entry

For transactions between parent and child companies or sister companies, the 'Inter-Company Journal Entry' is employed.

3.3 Bank Entry

Used when making or receiving a payment using a Bank Account. For instance, paying entertainment charges via the Company's bank account.

3.4 Cash Entry

Similar to 'Bank Entry,' but the payment is made via a Cash Account.

3.5 Credit Card Entry

Dedicated entry type for easy identification of credit card entries.

3.6 Debit Note

Document sent by a customer to a supplier when returning goods/items.

3.7 Credit Note

Document sent by a supplier to a customer when returning goods/items.

3.8 Contra Entry

Booked when a transaction occurs within the same company, covering types like Cash to Cash, Bank to Bank, Cash to Bank, and Bank to Cash.

3.9 Excise Entry

For handling excise duties related to purchasing and selling goods.

3.10 Write Offs or Bad Debts

Used for writing off an invoice as a bad debt.

3.11 Opening Entry

Useful when transitioning from another software to RERP during any time of the year.

3.12 Depreciation

For writing off a certain value of assets as an expense.

3.13 Exchange Rate Revaluation

Addresses situations with accounts in multiple currencies, allowing for effective management of exchange rate fluctuations.

Note: Ensure compliance with relevant country regulations regarding accounting practices.