Preparing the start of year accounts

Discussions, hints and tips for users of Ezi Accounting, from Ezi Solution.

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Preparing the start of year accounts

Postby sami » Mon Jun 05, 2006 6:10 pm

For the new users, the question is how to enter the starting balances of the various accounts. Note that all profit and loss and trading accounts has to be zero at the start of each accounting year, Retail Man and Ezi Accounting will zero these accounts automatically at the start of each year without the user intervention, The only thing the user has to do is provide the start of the accounting year from MAINTENANCE > SYSTEM SETUP > GENERAL, this has to be done only once and the system will use the day and month for each following year.
To prepare the start of year accounts, you need to look at the balance sheet accounts.
If you have the Balance Sheet from your accountant, you can enter that using ACCOUNTS > ENTRY VOUCHER and enter the accounts as shown on the Balance Sheet. If there is an account on the Balance Sheet that does not exist, just go to the Chart of Accounts and create it there, but at the end if the data entry, the DEBIT side MUST EQUAL the CREDIT side, once done, just save.

If you have already been using the system but have not used the accounting section, and you need to start using it in the following accounting year, you still need to get the balance sheet from your accountant, but since the accounts will have an existing balance, you will need to enter the difference between the starting balances and the actual balance, then if there is any imbalance, you can enter that in to a suspense account (normally an account in group 6)

This operation can be done anytime during the accounting year, you only have to change the voucher date to the start of the year date, and the system will work itself out.

The only question that remains is which is Debit and which is Credit, this is a major problem for the average user with no or little accounting experience, however, if you follow the rules below, you can’t go wrong (if you do, do not panic, you can always go back and modify your entries)

• Asset accounts (groups 1 to 3) are debit accounts - therefore to increase these accounts they must be debited.

• Liability accounts (groups 4 to 6) are credit accounts - therefore to increase these accounts they must be credited.

• Income accounts (group 7) are credit accounts - therefore to increase these accounts they must be credited.

• Expense accounts (Group 9) are debit accounts - therefore to increase these accounts they must be debited.
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Re: Preparing the start of year accounts

Postby StanD » Sat Jul 03, 2010 12:39 pm

Hi Sami,
I've been trying to figure out how to start the new financial year and I'm assuming that the RetailMan does all the important work for me. However shouldn't the count of invoices and purchases go back to 0 at the begining of the financial year? Or How can I bring it to Zero without loosing all the data from the previous year?

Many thanks

Stan
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Re: Preparing the start of year accounts

Postby JeremyW » Wed Jul 06, 2011 8:14 pm

Wouldn't you have to add the year to the invoice numbers so you know it's invoice number 1 for 2010 and invoice number 1 for 2009 and etc.? Or you could just continue the number from the previous year but I agree that it would be easier to read reports if the invoices started with 0 or 1. To start the financial year, you have to enter the date in the settings and it will do it automatically for you.

Jeremy - Comparing human resource management solutions.
Last edited by JeremyW on Mon Jul 18, 2011 4:17 pm, edited 1 time in total.
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Re: Preparing the start of year accounts

Postby graham » Tue Jul 12, 2011 11:35 pm

StanD wrote:Hi Sami,
I've been trying to figure out how to start the new financial year and I'm assuming that the RetailMan does all the important work for me. However shouldn't the count of invoices and purchases go back to 0 at the begining of the financial year? Or How can I bring it to Zero without loosing all the data from the previous year?

Many thanks

Stan


All invoices and purchases must have a unique number, so it is not possible or advisable to re-number invoices or purchases to 0 after a year end. If you prefer you could change the next invoice or purchase to start on a round number, so that 1000 could be used for the first invoice in a new financial year, but there is little to be gained by this apart from cosmetic appearance!


Graham Morris


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