FINANCIAL OR GL POSTINGS IN ANY ERP

WHAT IS ERP: Enterprise Resource Planning or ERP is integration of the all business cycles be it Purchase, Production, Sales, Accounting and Reporting. The ERP system is integration of operation processes and information flow in any organisation be it big or samll for resource optimisation.



BENEFITS OF ERP: Since ERP is a integration of business processes and information flow, hence there are some natural benfits of any ERP:

01. It is very effective internal control tool in any organisation

02. Very effecive cost control tool

03. Real time postings.....



COMPONENETS OF ERP: The whole business Process

01. Purchase

02.Sales

03. Production

04. Logistics

05. Accounts

06. Costing



SUPPLIER OF ERP: (for example)

01. SAP

02. ORACLE

03.BAAN

04 PEOPLE SOFT

05 RAMCO

06. JD EDWARDS



What is Financial Postings: In Business there are functions called Purchase, Sales, Production etc BUT if you don't do accouting for that , How you will determine profitability of the business?

ERP users of business cycles are not bothered about accounting, and therefore In ERP system all finacial postings are made in backend..that means The person who make a Good Recept Note is not required to bother about which account should be debited or credited....



Here I am trying to simplify all the financial postings made in any transaction happened in any ERP.

Nomenclature of accounts can be different as per the business requirement but substance is going t0 be same



NOTE: These postings are nothing but it is simple accounts which are studied by commerece students in school...It is very easy to understand thses accounting enteries so that a NOn accouting person makes a transaction in any ERP , willbe able to know waht will be accounting impact of that transaction.

PURCHASE MODULE:

Transaction Financial Posting

1. When PO is raised No entry since You have only comitted
2. AT the time of Good Receipt



Goods Receipt – Freeze receipt
Stock Suspense A/c Dr
Vendor Suspense A/c Cr


Goods Movement– For General Items
At the warehouse
Stock A/c Dr
Stock Suspense A/c Cr


Goods Movement– For Capital Items
At the warehouse
FA Suspense A/c Dr
Stock Suspense A/c Cr

Goods Movement– For Service Items
At the warehouse
Consumption a/c Dr

Stock Suspense a/c Cr


Drop-ship
When srock is delivered directly from supplier to customer, it is called dropship delivery
COGS a/c Dr
Stock Suspense a/c Cr