The purpose of this article is to explain the process required to set up the Chart of Accounts with an advanced nominal ledger structure using the minimum Chart of Accounts to enable full customisation.
The Advanced Nominal Ledger system enables the user to create the own chart of accounts using segmented or cost centre coding.
Note: Before starting, it is important to plan the Chart of Accounts structure.
Index:
The Database Set-Up Process
The Chart of Accounts Set-up Process
Changing the Category Labels
Creating the Categories
4.1 Area Set-Up
4.2 Department Set-Up
4.3 Detail Set-Up with Major Heading Assignment
Building the Chart of Accounts
5.1 How to add a new account once the chart has been built
Define System Default Account
1. The Database Set-Up Process
Load up dimensions and click more, then new database, enter SA password and click login.
This will open the new database setup wizard, fill in the details on this page for the company/organisation.
Then click next and choose the country from the drop-down list and click Change Setting, check that these details are correct for what is required.
Click next again and choose the type of chart of accounts required. For purposes of this article, it will be a minimum chart of accounts with an advanced nominal ledger structure.
Then next again and choose the date the ledgers are to start at.
Note: We advise opening the accounts one period before the current processing period to enable the user to enter opening balances.Click next again and choose the processing period to start in and whether the user wants to enter the opening balances in a prior period.
Click next and this page will show the opening balance period, first processing period and current financial year.
Double check these are correct if not then go back and change the details to make sure they are.
On the next page, enter the VAT registration (if applicable) and then the country code EU VAT prefix and also the Numeric Country ID.
The next place enables the user to select the number of decimal places to be used when showing values. Make sure to double check this as if, for example, 3dps is chosen and later on realised that only 2dps is required the user would be unable to change it back, though it is possible to change it to 4dps is required.
In the next screen, choose the name of the database.
Then decide where the Data and log file are to save to and also the size of it. Also, the user can set the Master users ID and password here and whether to add SA as a dimensions user or to allow a master user to create users.
If certain everything is correct, then click next and then finish to build the database.
2. The Chart of Accounts Set-Up Process
The first step is to enable the ANL designer and define the hierarchies in the System Control settings.
Click the System tab.
Click Options.
Click Nominal Ledger Options.
On the Records tab, tick the Advanced Nominal Ledger checkbox (if not ticked), which enables the Setup panel.
Enter the Number of Categories that are required for the segmented account codes.
Select a Concatenation Separator, if the user decides to use one (this will show later on it separates the different levels).
Select a Concatenation Method. The concatenation method selected determines the order in which categories are used to create the new nominal accounts. ANL allows the user to define a company (category) structure which adds the increased definition for reporting and greater efficiency for data entry.
Then go to the categories tab and choose the max length for the codes of the section and choose which is going to be the detail in this example we will use the last one as the detail.
So click the circular box to choose the detail category.
3. Changing the Category Labels
We will now change these Category Labels to reflect the company structure. With the Nominal Ledger Options window in the foreground, do the following:
Click the red Access symbol top left.
Click Description/Language.
Load Current Window ( this will bring up a window called language entry).
Click Edit and change the following labels, for example:
Label name NL_USERSORTNAM1, Text is Group Heading, Change to Area.
Label name NL_USERSORTNAM2, Text is Division Heading, Change to Department.
Label name NL_USERSORTNAM3, Text is Other Heading, Change to Details.
Save these changes and exit the window back to the nominal ledger options.
Complete the Category set-up with the following:
For Area, make length = 3
For Department, make length = 2
For Detail, make length = 2
Make sure the category named Detail has the circular box next to it selected so that it is set to the detail.
Click save and exit the window.
4. Creating the Categories
4.1 Area Set-Up
We will now enter the Categories that will form the basis of our Chart of Accounts. They will ensure that we can report on any selected category or combinations of categories. This is the process required to set up the Categories for Area.
On the Financials tab, click Set-Up.
Use the AreaSelect drop-down and enter the following example details:
Code = BUR, Name = Bury, Short Name = BUR
Code = GRO, Name = Group, Short Name = GRO
Code = LON, Name = London, Short Name = LON
Click Save.
Close the Window.
4.2 Department Set-Up
This is the process required to set up the Categories for Department.
Within the same screen, click on Set-Up.
Use the DepartmentSelect drop-down menu and enter the following example details:
Code = 10, Name = Sales, Short Name = 10
Code = 20, Name = Purchasing, Short Name = 20
Code = 30, Name = Admin, Short Name = 30
Code = 70, Name = Accounts, Short Name = 70
Click Save.
Close the Window.
4.3 Detail Set-Up with Major Heading Assigning
This is the process required to set up the Categories for Details.
Click on the Nominal button in the financial tab.
Click insert and enter the following example details then click save. Note: Click Save for each one. Example:
Major Headings | Code | Short Name | Name |
1 | 01 | Sales | Computer Sales |
1 | 02 | Sales | Printer Sales |
1 | 06 | Sales | Other Sales |
1 | 13 |
| Deliveries |
1 | 14 | Discount | Sales Discount |
3 | 15 | Difference | Exchange Differences |
3 | 16 | Difference | Rounding Differences |
2 | 20 | Purchase | Hardware Purchase |
2 | 21 | Purchase | Software Purchases |
2 | 26 | Discount | Purchase Discount |
4 | 30 |
| Telephone |
4 | 33 | Expenses | Motor Expenses |
4 | 34 |
| Subsistence |
9 | 70 | Account | Current Account |
9 | 71 | Cash | Petty Cash |
9 | 72 | Control | Sales Control |
10 | 80 | Control | VAT Conrol |
10 | 81 | Control | Purchase Control |
12 | 90 | Update | Year End Update |
12 | 99 | Account | Suspense Account |
Click Save and check that all have been entered correctly then close this window.
5. Building the Chart of Accounts
5.1 How to add a new account once the chart has been built.
On the Financials tab, click Chart of Accounts.
Select which accounts to create and determine the analysis records.
Example:Click Add to Top within the top toolbar.
Select all Area Codes (click and drag to highlight all).
Green tick to add these categories to the main window.
Select Bury with a single click.
Click Add and select the Department Codes by highlighting and ticking the green tick to add.
Select Sales & Purchasing and Accounts for this example.
Expand Bury from the Chart of Account – Build window.
Select Sales with a single click.
Click Add.
Select Detail and Codes 01, 14, 15 & 16.
Select Purchasing with a single click.
Add detail codes 20 & 26.
Select Accounts and add codes 70, 72, 80, 81, 90 & 99.
Select Buy and right-click and select copy structure.
Select Group and right click and paste structure here.
Repeat the previous step for London.
Click Save.
To add a new account to this then the user will have to make sure that the categories have all been created then follow this sections steps and add it in and from there follow the following.
Note: If it’s necessary to save the Chart of Accounts without Building the COA, save the current selections, quit the process and return at a later stage.
6. Define System Default Account
The following allows us to define the system default, accounts and create new nominal records complete with associated Sales and Purchase analysis records.
Click the Build icon and a new window will open that has a list of all accounts and asks to review and specify the relevant default nominal
As a default, it will have none in the default column, click this to change it.
Change to the following. Example - Select the following defaults:
Code | Default |
LON1001 | Sales |
LON2020 | Purchase |
GRO1014 | Sales Discount |
GRO1015 | Exchange Diff |
GRO2016 | Currency Rounding |
GRO2026 | Purchase Discount |
GRO7070 | Sales COntrol |
GRO7080 | VAT Control |
GRO7081 | Purchase Control |
GRO7090 | Year End |
GRO7099 | Suspense |
Other than the defaults needed, leave the rest as none.
Review this page to make sure that all the details are correct
Then click the green tick which will open a window asking to confirm the creation of these accounts.
Click Yes and it will create the accounts.
Note: This may take a while depending on how many accounts are created.Once completed this will open another window that asks if the user would like to view and configure the Analysis records that will be created.
If Yes is selected the Nominal Codes and their associated Control Accounts and how they are set-up will show in a new window and will be asked to review and then confirm by clicking the save icon
Also, the opportunity to amend them or cancel will be available.
Click Save. The chart of Accounts will have been created but will be able to be amended.