How to Use Payment Reconciliation Tool?

Payment reconciliation is a tool to define the invoice in unadjusted payment entries (journal voucher). Let's consider an scenario to understand this query.





Looking at above given screen-shot, we can try and learn how payment reconciliation works.

INV00018 is the sales invoice worth 1,436.75. There has been no payment entry against invoice hence its 100% invoice is outstanding.

Table below has pulled up all the unadjusted payment entries with amount still not reconciled against any invoice. To reconcile the said amount against invoice INV00018, they will need to check box against JV and click on “Reconcile” button.

Clicking on reconcile  button will update invoice no. in unadjusted journal voucher.

Thanks,
ERPNext Team
www.erpnext.com

How to Manage Serial Nos. in ERPNext?

Serial nos. are the unique code assigned to each items. With serial nos. item detail and its location is tracked. Serial nos. is generally tagged for item which requires after sales services on it. Hence, businesses mention serial nos. in invoice based on which items delivery and warranty status is updated. In case of after sales service, company refers to serial no. to check invoice and purchase detail of that particular unit of an item.

Note: ERPNext doesn't have functionality to generated barcode for serial nos. Hence you will need to use third party application to manage generate barcode for serial nos.

Let's consider an example of company in sales of desktop and laptop computer. As there is warranty and after sales services provided on items they assign serial nos. on each unit they purchase or assemble.

Status of serial nos.

1. In store - Available for delivery / material issue. Updated when submit GRN or enter serial no. manually.
2. Delivered - Delivered to customer.  Updated when submit serial no.
3. Purchase return -  These are the serial nos. which are returned back to customer.
4. Not in use - Are the units which were define purchase receipt but then canceled due to some reasons. These are the serial nos. which becomes active if tagged in purchase receipt or material receipt again.

How to make item a serialized item?

Its defined in item master. In Item >> Inventory detail >> Has Serial no., selecting "yes" will make it serialized item.

How serial nos. get assigned to each unit of a item?


Serial nos. are assigned as soon as company acquires that item. The transaction made while receiving items are purchase receipt a.k.a GRN (in trading) and backflush (in production).


Let's consider a scenario when company places an order for 10 units of serial nos. and making a receipt for the same. When making purchase receipt, user will need to define serial nos. for serialized item based on receipt qty. If 10 qty of PC received, then user will enter / scan 10 serial nos. in serial no. column of that item.

Based on the serial nos. of items mentioned in purchase receipt, on submission system will created a unique serial no. record for each unit of an item. Also status for serial no. is set as as "in store" which will also reflect in stock level report.

Inventory of serialized item is tightly integrated with qty of serial nos. in warehouse. In stock level report for item in particular warehouse will be qty of serial nos. with status as "in store". So, if item A has 5 qty in warehouse X. It means that there are 5 serial no. for that item with status "In Store".

There are multiple possible actions which can be taken over serial no. in store. It can be delivered or issues for production (as raw-material).

Delivery Note:
When making delivery note of serialized item you will need to mention serial nos. equivalent to items quantity. On submitting delivery note serial nos. status will change to "Delivered". Also, based on days of warranty mentioned in item master, system will calculate exact warranty expiry dates starting from delivery date.

There could also occur a scenario where sales bom is created for an item. And one of the child item is serialized. In that case, in delivery note, sales bom item will be in main item table but that itself is not serialized item. And child item will be listed in packing details table. You will need to provide child items serial no. in packing details serial no. column.

Material issue:
In case of material issue you will need to provide serial nos. which will be consumed while manufacturing of finished good.

Account Payable & Receivable Reports

The accounts payable report provides detail of the money owed by the business in due format. The total amount owed per supplier  per invoice is provided. Also, you can set aging in report like amount to be paid in next 0-30 days, 30-60 days etc.

The accounts receivable report gives you a detailed listing of the balance due over customer per invoice. This helps company follow customer for pending payment against specific invoices.

To check these report in erpnext, go to:

Account >> Report >> Account payable / receivable reports

What are filters for?

Using date and accounts filter you can filter invoice made between specified time for particular customer / supplier.

-- For more queries, write us on support@erpnext.com --

How to Use Tax Inclusive Rate Functionality in ERPNext?

Tax inclusive rate functionality allows user to enter tax inclusive rate  items rate table.

As per the standard, user has to enter items rate before tax in pricelist which is fetched in items ref rate.

But for company into retail business, users only know tax inclusive rate of an item. They can use this feature which will back calculate tax and ref rate for them.

To back calculate taxes from tax inclusive rate, you will need to:

1. Mention taxes applicable on item level.
2. Tax inclusive rate in rate / basic rate column on item level.
3. Mention all the possible tax ledgers in tax table and check mark "include in print rate".

P.S.:

When need to calculate discount:

When need to offer discount to customer, mention tax inclusive rate in ref rate instead of basic rate.

How to Manage Production Order?

Production order is confirmation for production to start moving resources and process raw materials to get finished good.

To create new production order, go to:

Production >> Production Order

Let's check submitted production order which will help us understand the feeding data in and next steps after raising production order.

1. Its an item which will be produced.

2. For this production order, selected bill of material will be considered. Items listed in selected bom will reduce once production completes.

3. FG warehouse: Its a finished good warehouse where finished good when produced completely will be transferred.

4. WIP warehouse: Its a warehouse where production will take place. You will need to create your shop floor as WIP warehouse. All your raw-material will be brought into WIP warehouse only.

5. Consider SA (sub-assembly) item: This field has two options, yes / no.

If select yes, you will need to transfer sub-assembly as one unit of item. You should be selecting yes only if you separately maintain stock of sub-assembly.

Select No if you don't maintain the stock of sub-assembly. If no select, in material transfer, it will pull child item mentioned in bom of sub-assembly.

Once production order is submitted, you will find next steps button which starts with material transfer.

Transfer material: 

This transaction actually takes place in stock entry, where all the raw-material will be pulled from selected BOM. 

Target warehouse will be WIP warehouse selected in production order. User will select source warehouse based on the actual stock level for that raw material item.

After selecting all the information, system will reduce stock level from source warehouse and increase the same in WIP warehouse selected.

Status of production order will change to "in process" once raw material is transferred into WIP warehouse.

Backflush:

Backflush is done when in actual, you have ready finished good to be transferred from shop floor to finished good warehouse. At this stage, your raw material will be considered as consumed.

How to Make BOM (Bill of Material)?

Bill of material is list of raw material and operations through which raw material is processed in process of getting converted into finished good.

So bill of material in made for finished good and sub-assembly (for which separate production order is raised).

For making bill of material for an item, there are pre-requisites.
1. It should be stock item.
2. In item master, following production related values should be selected.
     > Allow bill of material - Yes
     > Allow production order - Yes

To make BOM, go to:

Module >> Production  >> Bill of Material >> New Bill of material

Bill of material form for separate tab for finished goods details, operations and finally materials detail.

Basic item detail:

It will list production item for which bill of material is made. BOM for will raw material required for making quantity mentioned in field above.

If default UOM checked, it will be updated in item master also.

BOM operations detail:

Operations table will list work stations in which your raw material will be processed and convert into finished good.

Operations operating cost will be considered in valuation of BOM also.

To make new work station, go to:

Production >> Work station >> New work station

BOM Material list:

It's a list of raw material which will be consumed in production to give finished good. It will list direct raw-materials and sub-assemblies for which separate bom is made. If company does not raise separate bom for sub-assembly item, you can list all the raw material required for sub-assembly in material table itself.

Costing:

Based on operations cost and raw materials rate system will give you bom valuation.

After entering all the detail save and submit this BOM. Only submitted bom will be available for selection in production order.

Configuring ERPNext Account

An application is said to be configured completely when you can start making business transactions like orders, invoices, stock transactions etc.

Let us understand the different types of forms which exist in ERPNext:

1. Masters:
    Masters are sets of records which are created once and used in transactions.
    Example: Customer, Supplier, Item, Customer Group, Supplier Type, Territory etc.
    Once the required masters are set, you can proceed with transactions.

2. Transactions:
    Business transactions are the records created based on an event.
    Example:
    Sales order is made when a customer confirms an order.
    Delivery note is made when goods are delivered to a customer.

3. Reports:
    Reports give you an interface to see multiple records of Transactions / Masters on the same screen

    and allow you to export these records in CSV format.

Getting Started:

When you login into your account for the first time, you will be asked to enter the name, abbreviation, fiscal start date and default currency of one of your companies. This creates the first company for your account.

Note: The abbreviation you enter will be appended to various master records, so that it becomes visibly obvious, which master record belongs to which company.

With company creation, your account creation will also be complete. To be able to start with transactions, you can setup your customer, suppliers, items, tax / bank ledgers.

Customer:

To add a new customer, go to:

Selling >> Customer >> Add new customer

OR

Setup >> System >> Import data. Select customer from the list to download template for importing customer master. Learn more about data import functionality here.

Customer categorization: If you want to create customer groups, go to:
Setup >> Selling >> Customer group

If you don't maintain customer group, continue with "default customer group" which be preset in your account.

Accounting ledger of customer:
Customer ledger will be created in chart of accounts (account receivable) as soon as you add or import them.

Supplier:

To add a new supplier, go to:

Buying >> Supplier >> Add new supplier

Or

Setup >> System >> Import data, Select Supplier from the list to download template for importing supplier master.

Supplier Types: If you want to create supplier types, go to:
Setup >> Buying >> Supplier Types

If you don't have supplier type, continue with "default supplier type" which will be preset in your account.

Accounting ledger of supplier:
Supplier ledger will be created in chart of accounts (account payable) as soon as you add or import them.

Item:

To add new item, go to:

Stock >> Item

Or

Setup >> System >> Import data, select item from the list to download template for importing item master. Learn more about import data functionality here.

Customer categorization: If you want to create item groups, go to:

Setup >> Stock >> Item group

If you don't maintain item group, continue with "Default" which will be auto-created.

To import opening stock for items, go to: Stock >> Stock reconciliation. To learn more, click here.

Accounting ledger:

To create new accounting ledger, go to:

Setup >>  Accounts >> Chart of account

1. Click on group under which you want to create ledger.
2. After clicking on folder (group), under which you want to create ledger, a button called
    "Add a child account" will appear below action items (on right side).
3. Enter account name
4. Select group or a ledger. If "group" selected, then it will become folder and you will be able to
    add child ledgers under it. If "Ledger" selected, then only you will be able to select it in
    transactions.

For getting started, you will need to create few accounting ledgers manually for bank, cash and tax accounts. To learn more on creating ledger in chart of account, click here.

To learn updating an opening balance for accounting ledger, click here.

Note: Ledger for customer and supplier will be added in the receivables and payables respectively. You need not add ledger for customer and supplier manually.

Warehouse:

To create new warehouse, go to:

Setup >> Stock >> Warehouse

Once above discussed masters is set, you will be good to go live with transactions like making quotations, orders and invoices.

For any product related help, please drop us a line at support@erpnext.com

Price List to Manage Multiple Currency

Price list is the master to list multiple selling rate (before tax) for the item. To learn uploading pricelist, please click here.

As per the recent update in pricelist, you can list item pricelist in any currency and make sales transactions in any currency.

Let's consider the scenario, where the company XYZ Pvt. Ltd. based in India, has INR as the basic account currency.

Company maintains its item price list in USD as against there company default currency.

Now, when making transaction, say sales order, pricelist will be pulled in USD. But we need to make sales order in INR.

Frappe is the item whos selling price is 1 USD. Now we need to make sales order in INR. So,

Customer currency will be INR only. And as it is also a base currency of application, conversion rate remains 1.

Pricelist currency is USD for frappe. But as we need pricing in INR, we mention conversion factor for USD with respect to INR.

Picture above shows ref rate, rate and amount in currency INR currency for selected item. Its what will be reflected in print format.

Let's consider another scenario where accounts basic currency is INR. Am making items price list in USD and making sales order also in USD.

Ref rate, rate and amount (without * ) is columns for customer currency.

Raf rate*, basic rate* and amount* is column for base currency which is calculated after multiplying price list rate with conversion rate
(34.90 (price list) * 53 (conversion rate) = 1,849.70 INR)

And the most basic scenario where accounts basic currency, price list and customer currency is same.

Both pricelist and custom currency remain same with conversion factor 1.

Broadly speaking, now you can manage pricelist and transactions in any currency possible.

How to Manage Tasks in ERPNext ?

You can create tasks and allocate them to your users. These tickets can be linked to a project and the status of the completion of each task can be tracked. To create a task follow the steps as shown below.

The Task Details will capture the subject of the task and by whom it is raised.

Mention the user name to whom this task is to be assigned in the Allocated To field. You can allocate tasks only to those employees whose login ids are created in the system.

The Status will be Open when the the task is created.

Select the relevant Project Name from project master to which this task belongs to.

The Time and Budget details will capture the expected and actual start date and end date of the task.

Save the task.

When the task has been finished, the user to whom the task had been allocated can click on Get Approval as shown below. The Status will be changed to Pending Review.

The user who had raised the ticket can close it after verifying by changing the status to Closed as shown below and then save the task.

For more details, please visit www.erpnext.com

How to Create a Debit Note in ERPNext ?

You can create a Debit Note against a Purchase Return.

To know how to use the Purchase Return Wizard visit
http://erpnext.blogspot.com/2011/03/how-to-manage-purchase-return-in.html

To create a Debit Note directly , follow steps as shown below

A new Journal Voucher will open up. Debit the amount against the supplier account head and credit the same amount against an Expense account.

Save and Submit the Journal Voucher as shown below.

For more details, please visit www.erpnext.com

How to Create Delivery Notes in ERPNext?

Delivery Note can be created from a Sales Order. However to create a Delivery Note directly, follow steps as shown below.

The Delivery Notes will have the following tabs. Lets have a look at each tab in detail.

The Basic Info tab will capture details related to the customer and the posting date on which the stock ledger entries will be affected. You can mention the lorry and challan details as well.

The Items tab will have a list of items and their quantities to be delivered from a warehouse. You can create a Delivery Note against multiple Sales Orders.

The Ref rate will get fetched from the item master on selection of price list. Changes can be made to the Rate which will calculate the Discount(%) on Ref Rate. The below rate and amount are in customer's currency.

Mention the warehouse from where goods will be delivered so that the stock level gets reduced from that warehouse on submitting Delivery Note. Mention Serial Nos and Batch Nos if applicable to the item. Serial numbers can be separated by a comma.

The Taxes tab will capture the total tax amount. If you have not created a tax template, enter taxes directly. You can select Type based on the following requirements :

1. Actual - when you know the actual amount of tax or other charge to be added to the net total, mention the amount in the Rate column.
2. On Net Total - will be selected when a tax percentage has to be calculated on the net total.
3. On Previous Row Amount - will be selected if a tax percentage needs to be calculated over the previous row tax amount . In this case mention the Row Id.
4. On Previous Row Total - will be selected when a tax percentage needs to be calculated over the total of net total and the previous row tax amount. In this case also mention the Row Id

Select the relevant tax account head applicable. The account head should be created under Chart of Accounts. The tax rate will be mentioned in the account head and will get fetched under the Rate column on selecting the same. 

Creating a tax template will save your time. To see how to create a tax template click on the link http://erpnext.blogspot.com/2011/02/how-to-create-template-for-taxes-and.html

The Terms tab will have the terms and conditions and other additional information which you would want to appear on the Sales Order print format. You can even create a template pull its details. To create a template click on the link http://erpnext.blogspot.com/2011/02/how-to-create-templates-for-terms-and.html

The More Info tab will capture additional information.

The Sales Team will capture the details of the Sales Partner and Sales Persons involved in the sales process and their commission and allocated percentage. The sales team is captured even in the Customer master and can be fetched from there once the customer is selected in the Sales Order.

Now save and submit the Delivery Note. 

Submitting the Delivery Note reduce the stock quantity from the warehouse selected. Also you can email and print the Delivery Note. 

Sales Invoice can now be made against the Delivery Note to book your income.

For more details, please visit www.erpnext.com