General Ledger General Ledger
The General Ledger system performs the following functions:
•Provides a user-definable Chart of Accounts.
•Provides a system of entering transactions to Prior Months and printing new Financial Statements for each succeeding month.
•Provides for repeating journal entries.
•Maintains Accounting Detail for an unlimited number of fiscal periods.
•Provides postings in Batches, ensuring correct entry.
General Ledger Overview
The General Ledger system is designed to maintain an unlimited number of open periods of accounting information. These periods may be months, quarters or periods of variable length that are user defined.
Two types of information files are maintained by the General Ledger system. One file is called the Master File and contains one record for each account in the General Ledger. These accounts are user defined.
The second file is the Transaction File. It contains each transaction made to the General Ledger for a specific fiscal period. These transactions are added sequentially to the file so that the file increases in size indefinitely. The record of each transaction includes:
•Date of the transaction
•Amount of the transaction
•Description
•Source of the transaction
•Identifying transaction number which increases serially with each transaction
•Accounting period to which the transaction belongs
•Check number (if applicable)
•Journal number
•Account to which the transaction should be applied
•Job number or equipment ID (if applicable)
•Cost code (if applicable) to which the transaction should be applied
•Quantity included in transaction (for quantitative accounting on jobs)
Integration With the Rest of the System
The General Ledger module of the Construction Management System is integrated with all other modules in the system. This means that when operating the Payroll, Accounts Payable or Accounts Receivable modules of the system, all related General Ledger transactions are automatically produced and appended to the Transaction File. Transactions made automatically in this manner are marked with a code of ‘P/R,’ ‘A/P,’ ‘S/J’ (sales journal), or ‘C/R’ (cash receipts).
There will be many situations that require transactions made directly to the General Ledger without working through a different module of the system. This is easily done through the Transaction program accessed through Transactions on the General Ledger Menu. The code of such transactions will be marked ‘G/J’ (General Journal), unless another ID code(s) is specified.
For example: a series of codes such as ‘CD1,’ ‘CD2’ might indicate cash disbursements or ‘ADJ’ may indicate adjustment entries.
Integration With Job Costing and Equipment Costing
Most transactions to the General Ledger will be made through other modules in the system. Occasionally, some transactions are made directly without going through Payroll, Accounts Receivable or Accounts Payable. Examples of this are month-end or year-end adjustments, backing out voided checks, or making other corrections
Transactions entered directly to the General Ledger through the Transaction program may be costs that affect a job or piece of equipment. These costs will need to be added to the Job Cost and/or Equipment Costing records as well. Because the General Ledger is integrated with Job Costing and Equipment Costing, there is no need to make a separate entry for Job Costing or Equipment Costing. During entry, the job number or equipment I.D., an associated cost code and an associated quantity may be entered. When transactions are posted, all amounts will be automatically updated in the Job Cost and Equipment Cost records.
Integration With Purchase Order
The Purchase Order module is used to track committed costs. Committed costs are anticipated costs and do not directly affect the General Ledger or accounting system. Once purchase order items are received and accepted, a real cost or expense is incurred. Reconciled purchase orders are posted to create accounts payable invoices which are handled through the Invoice Entry module. The Purchase Order system checks budgets in the rest of the accounting system to prevent overspending. The Purchase Order module is, therefore, indirectly integrated with the accounting system.
The different types of accounts
•Accounts may be designated as cash accounts.
•Accounts may be designated as working capital accounts.
•Sales accounts are accounts to which income is credited.
•Any account may be designated as a checking account. Check registers may be printed and Bank Statement Reconciliation may be performed for accounts marked as checking accounts.
•If the account is not a cash account,a checking account, a control account, or sales income account, no account type should be assigned.
Transaction entry into the General Ledger is done on a Batch-by-Batch basis. After transactions are entered, a proof listing may be generated to review the input before it is posted and integrated into the system. Once transactions have been reviewed and edited, the posting program automatically updates the General Ledger and any other transactions affecting all other modules in the system.
Some transactions are the same from month to month. Examples of this are rent, utilities or loan payments. A feature has been built into the system to allow the definition of Repeating Transactions. Any set of transactions may be appended to a Batch file at any time. As the Batch file is posted, the transactions found in the repeating transaction file will be posted along with any single transactions previously entered.
Check Registers
A Check Register Listing may be printed for any single checking account or range of accounts by fiscal period, date, check number or transaction type.
Budgets
Budgets may be assigned to each fiscal period for any General Ledger Profit & Loss account. A proof listing of the budgets may be printed. An option during Financial Statement printing allows a budgetary analysis report to be generated.