(194)-OUTPUTS FROM A SALES LEDGER SYSTEM

Outputs from a Sales Ledger System

Typical outputs in a computerized sales ledger are as follows.

• Day book listing. A list of all transactions posted each day. This provides an audit trail i.e. it is information which the auditors of the business can use when carrying out their work. Batch and control totals will be included in the listing.
• Invoices. (if the package is one which is expected to produce invoices)
• Statements. End of month statements for customers.
• Aged debtors list. Probably produced monthly.
• Sales analysis report. These will analyze sales according to the sales analysis codes on the sales ledger file.
• Debtor’s reminder letters. Letters can be produced automatically to chase late payers when the due date for payments goes by without payment having been received.
• Customer lists (or perhaps a selective list). The list might be printed on to adhesive labels, for sending out customer letters or making material.
• Response to enquiries. Perhaps output on to a VDU screen rather than as printed copy, for fast response to customer enquires.
• Output onto disk file for other modules. Example, to the stock control module and the nominal ledger module, if these are also used by the organization and the package is not an integrated one.

(193)-PROCESS IN A SALES LEDGER SYSTEM

Process in a Sales Ledger System

The primary action involved in updating the sales ledger is modifying the amount outstanding on the customer’s account. How the amount is modified depends on what data is being input.

When processing starts, the balance on an account is called the brought forward balance. When processing has finished, the balance on the account is called the carried forward balance. These terms are often abbreviated to b/f and c/f.

What a computer does is to add or subtract whatever you tell it to from the b/f balance, and end with a c/f balance.












This method of updating customer accounts is called the balance forward method.


Most systems also offer users the open item method of processing the data, which is much neater. Under this method, the user identifies specific invoices, and credits individual payments against specific invoices. Late payments of individual invoices can be identified and chased up. The customer’s outstanding balance is the sum of the unpaid open items. The open item method follows best accounting practice, but it is more time consuming than the balance forward method.

(192)-INPUT TO A SALES LEDGER SYSTEM

Input To a Sales Ledger System

Bearing in mind what we expected to find in a sales ledger, we can say typical data input into sales ledger system is as follows.

Amendments

• Amendments to customer details, eg change of address, change of credit limits etc
• Insertion of new customers
• Deletion of old “non-active” customers

Transaction data relating to:

• Sales transaction, for invoicing
• Customer payments
• Credit notes
• Adjustments (debit or credit items)

Some computerized sales ledgers produce invoices, so that basic sales data is input into the system. But other business might have a specialized invoicing module, so that the sales ledger package is not expected to produce invoices. The invoice details are already available (as output from the specialized module) and are input into the sales ledger system rather than basic sales data.

(191)-ACCOUNTING FOR MODULES

Accounting for Modules

Accounting for Debtors

A computerized sales ledger will be expected to keep the sales ledger up-to-date, and also it should be able to produce certain output. The output might be produce daily, monthly, quarterly or periodically.

Example- responses to file interrogations, or customer name and address lists printed on adhesive for dispatching circulars or price lists.

What we need to do is to have a closer look at the forms that input, output and processing take within a sales ledger. We will begin by thinking about what data we would expect to see in a sales ledger.

Data held on a sales ledger file

The sales ledger file will consist of individual records for each customer account. Some of the data held on the record will be standing data. Typically items of standing data are:

• Customer account number
• Customer name
• Address
• Credit limit
• Account sales analysis code
• Account type

Each of these items is referred to as a field of information.

Other data held on a customer record will change as the sales ledger is updated. Such data is called variable data, and will include:

• Transaction data
• Transaction depreciation
• Transaction code
• Debts
• Credits
• Balance

The file which contains these customer records – the sales ledger – is sometimes called a master file. If it is updated from another file containing various transactions, then that file is called a transaction file. Developments in the way computers store information mean that you not likely to see these items much any more – people more often talk about “databases” of information.

(190)-INTEGRATED SOFTWARE

Integrated Software

Each module may be integrated with the others, so that data entered in one module will be passed automatically or by simple operators request through into any other module where the data is of some relevance. For example, if there is an input into the invoicing module authorizing the dispatch of an invoice to a customer, there might be automatic links:

• To the sales ledger, to update the file by posting the invoice to the customer’s account.
• To the stock module, to update the stock file by:
  1. Introducing the quantity and value of stock in hand
  2. Recording the stock movement
• To the nominal ledger, to update the file by posting the sale to the sales account.
• To the job costing module, to record the sales value of the job on the job cost file.
• To the report generator, to update the sales analysis and sales total which are on file and awaiting inclusion in management reports

Advantages

• It becomes to make just one entry in one of the ledgers which automatically updates the others.
• Users can specify reports, and the software will automatically extract the required data from all the relevant files.
• Both of the above simplify workload of the user, and the irritating need to constantly load unload disks is eliminated.

Disadvantages

• Usually, it requires more computer memory than separate (stand-alone) systems which means there is less space in which to store actual data.
• Because one program is expected to do everything, the user may find that an integrated package has fewer facilities than a set of specialized modules. In effect, and integrated package could be “jack of all trades but master of none”.

(189)-MODULES

Modules

A module is a program which deals with one particular part of a business accounting system.
An accounting package will consist of several modules. A simple accounting package might consist of only one module (in which case it is called a stand-alone module), but more often it will consist of several modules. The name given to a set of several modules is a suite. An accounting package, therefore, might have separate modules for:

• Invoicing
• Stock
• Sales ledger
• Purchase ledger
• Nominal ledger
• Payroll
• Cash book
• Job costing
• Fixed asset register
• Report generator

(188)-USING AN ACCOUNTING PACKAGE

Using an Accounting Package

When a user begins to work with an accounting package he will usually be asked key in a password. Separate password can be used for different parts of the system, for example for different ledgers if required. The user will then be presented with a “menu” of options such as “enter new data” or “print report” or a windows type screen with buttons and icons. By selecting the appropriate option the user will then be guided through the actions needed to enter the data or generate the report.