Accounting and Finance

Last updated: March 25, 2019

Accounting and Finance

Straightforward yet ground-breaking, Odoo Accounting module can be best depicted in these two words. You can process your exchanges rapidly utilizing Odoo Accounting. Odoo's accounting module comes integrated with all different applications of Odoo like Sale, Purchase, Inventory and Human Resource. This makes working with Odoo progressively straightforward and brisk.

There are numerous things which make Odoo a one of a kind product than any other ERP Accounting modules. When we contrast Odoo Accounting and other ERP suites like Microsoft Dynamics and NetSuite, one can see numerous highlights which Odoo alone have. For instance, Quick reconciliation, Automatic Sync, Batch Send, Third Party Follow up, Payment Automation, Alerts, and Expenses. In any case, neither NetSuite nor Dynamics bolster these highlights yet just some of them. Since all bookkeeping exchanges are related with clients or providers, you get reports to perform investigation per client/provider, for example, the client statements, revenues per customers, matured receivable/payable and so on. Another exemplary accessible in Odoo is its business intelligence motor which will enable you to explore through organization information in increasingly sorted out way. The charts and outlines plotted by BI engine is for sure a helpful device in basic leadership. Obviously, Odoo is versatile as well. You can utilize it to check your records in a hurry.

Following is the way Odoo manages regular records and exchanges.

Double-entry bookkeeping

Odoo automatically creates journal entries for every accounting transactions and utilizes double-entry bookkeeping system.

Accrual and Cash Basis Methods

Odoo bolster both accrual and cash basis detailing. This enables the end user to report income/cost at the time when transaction exchanges happen.

Multi-companies

Odoo permits to deal with several organizations within same database. Each organization has its very own chart of accounts and guideline rules. One can get consolidation reports following your solidification rules.

Multi-currencies

Each exchange is recorded in the default currency of the organization. For transactions happening in another currency, Odoo stores both the value in the money of the organization and the value in the cash of the exchange. Odoo can produce currency gains and misfortunes after the reconciliation of journal items.

International Standards

Odoo accounting bolster in excess of 50 nations. The Odoo executes accounting standards that is regular to all nations. Customized applications are accessible to oblige the specificities of individual nation; like chart of accounts, taxes, or bank interfaces.

Accounts Receivable & Payable

By default, Odoo utilizes a solitary record for all record receivable sections.

In Odoo, you can create budgetary reports continuously. Odoo's reports include:

  • Performance reports, (for example, Profit and Loss, Budget Variance)
  • Position reports, (for example, Balance Sheet, Aged Payables, Aged Receivables)
  • Cash reports, (for example, Bank Summary)
  • Detail reports, (for example, Trial Balance and General Ledger)
  • Management reports, (for example, Budgets, Executive Summary)
Import bank feeds automatically

Odoo makes bank reconciliation simple by frequently bringing in bank statements lines from your bank directly into your Odoo account.

Inventory Valuation

Odoo underpins both periodic (manual) and perpetual (automated) inventory valuations.

Easy retained earnings

Odoo automatically ascertains your present year earnings in real time; with the goal that no year-end journal or rollover is required. This is determined via consequently reporting the profit and loss balance to your balance sheet report.

Configuring Company Data

Prior to any transaction, the first action to be triggered is entering the Company data. For that, go to Accounting Dashboard, click on the icon Let’s start under Company Data. Upon clicking the button, a new window will appear like below:

Under the create form, One can define the Company Name

Under General Information Tab

The user can provide the relevant company details in the embedded fields. It includes Address of the company, Company Website, Phone number, Email Address, VAT, Company Registry, Default incoterm for Intrastat (International Commerce Terms are a series of predefined commercial terms used in international transactions), Currency, Nomenclature, Parent Company.

Under Inter-Company Rules Tab

If your company is involved into the buying and selling of products/services among different branches within the conglomerate, Odoo helps in handling the inter-company movements starting from initial point to the end point.

Rule types

1. SYNCHRONIZE SALES AND PURCHASE ORDERS.

Purchase Order and Sales Order will be connected. On the off chance that an organization within your group makes a purchase or a sales order, the corresponding archive/document will be automatically created for your organization. You should simply check whether everything is correct and later affirm the sales.

It's simple and speedy. It tends to be significantly smoother if you automated validation on your sales and buy orders. Odoo will look after the entire procedure, from the quotation to the invoicing and bookkeeping.

2. SYNCHRONIZE INVOICES AND BILLS

Odoo makes it possible to handle the invoice/refunds at its easiest manner.

To help you through the procedure, two new choices will enable you to share partners and products within group.

After making the relevant edits, the status gets changed to ALL DONE.

Configuring Bank Accounts in Odoo

Proper Management of Bank Accounts are utmost crucial as far as an Accounting module is concerned. Under Odoo, the user can seamlessly manage various Bank Accounts and Credit card accounts. The user can Add, Update and Delete their bank account details following few simple steps.

Configuration

One can either do them directly from the dashboard or via

Going to Accounting-> Configuration-> Accounting -> Bank Account

Under Odoo, the end clients can manage multiple bank accounts. As you see in the below image, in order to ease the work process of the end client, the bank account has already been created by Odoo. One can edit it prior to filling the relevant bank information.

To create a bank account, Go to Accounting ‣ Configuration ‣ Bank Accounts. Click on the option and later fill in all relevant info in the form. You can choose over whether to display the bank account number in the sending documents like sales order or invoices. Also select the payments methods you support with this ledger.

To delete a bank account, from the rundown of bank accounts, select items to erase and erase them from the action menu or go to the form and delete a solitary item from action menu.

Supplier/customer bank accounts or credit card accounts: In order to create the bank accounts or credit card accounts related to each customer, go to customers list and select the customer to which we need to add the bank account.

Configuring Fiscal Years in Odoo

A fiscal year (FY) is a period that an organization or government utilizes for bookkeeping purposes and preparing budget summaries. The fiscal year changes among nations and is basically utilized for financial reporting by business and different associations. A fiscal year may not be same to a scheduled calendar year, however for tax purposes, the Internal Revenue Service (IRS) enables organizations to be either calendar- year tax payers or fiscal-year taxpayers.

One can configure fiscal year via clicking the button CONFIGURE under FISCAL YEAR segment.

By default, the fiscal year starts with the 1st of January and ends on 31st of December, as those are the most common opening and closing dates. However, one can change the dates depending on your company.

One can also configure the fiscal year, via going to Accounts-> Configuration-> Settings. Tick the option Fiscal years under Fiscal Periods option.

Much of the time, the fiscal year lasts for 12 months. In the event that it is your case, you simply need to define what is the last day of your fiscal year in the bookkeeping settings. By default, it is determined to be 31st December.

However, as we said forth, there may be a few special cases. For instance, if your business organization’s fiscal year, lasts pretty much than a year. In this case, you would need some extra arrangement.

Configuration

Accounting -> Configurations->Accounting-> Fiscal years

You would be able to configure your fiscal year here via clicking on the link Fiscal Year.

A new form will appear like below.

Here, the user can add relevant details like Name, Start Date, End Date and Company and create a new fiscal year pertaining to company policy.

Basic Configurations

For that go to, Accounting->Configurations

Firstly, one needs to set up general configurations of the Accounting system. One would find the basic and important configuration below the accounting.

Configuring Chart of Accounts in Odoo

A chart of accounts is a rundown of the names of the accounts that an organization has recognized and made accessible for the recording transactions in its general ledger. An organization has the adaptability to tailor its chart of accounts to best suit its needs. This is determined via consequently reporting the profit and loss balance in your balance sheet report.

Odoo provisions the end client to utilize the predefined charts of accounts, encompassing all basic configurations like tax codes and fiscal localization packages. However, one can also create their own chart of accounts in Odoo.

For that go to Accounting-> Configuration-> Accounting ->Chart of Accounts.

Upon clicking the chart of accounts, you will be navigated to a new window like below image:

As said above, one can see the rundown of different account names. Upon clicking any, one can make sufficient edits to the existing. Click Save button to mark changes.

In order to configure a new Chart of Accounts, click on the CREATE button.

Upon clicking the CREATE button, you will be navigated to a new creation form, just like below.

One can include the details like: Tax code, Account Name, Account Type, Default taxes, Tags for Custom Reporting, Group, Company, and Account Currency.

Configuring Taxes in Odoo

Odoo's tax engine is very adaptable and it comes supportive to a wide range of tax types like value added taxes (VAT), eco-taxes, federal/states/city taxes, retention, withholding taxes and so on. For most nations, the system is pre-designed or configured with the right taxes.

Configuration

In order to define new taxes for explicit use cases.

Go to Accounting-> Configuration-> Accounting -> Taxes.

From this menu, you get all the taxes you can utilize: say sales tax or purchase taxes.

Upon clicking the desired, you will be navigated to a new window just like below:

The creation form will have the following attributes:

Tax Name: Name of the tax

Tax Scope: The field defines where to use this tax. If you select ‘None’, you can only use this tax with other tax group. Odoo provides with Sales, Purchase, None (for example belittled or deprecated expense) and Adjustment.

Under Definition tab:

Tax computation: Odoo have four different types of tax computation-

  • Group of taxes
  • Fixed
  • Percentage of price
  • Percentage of price tax included

Group of Taxes: Permits to have a compound duty.

Fixed: eco-taxes, and so on.

Price of Percentage: most normal (for example 15% sales tax)

Percentage of Price Tax Included: utilized in Brazil, and so forth.

Tax account: The account, that will be used in the invoice tax lines. Later journal entries are created using this account. If we leave it empty, Odoo will take the default debit/credit account of Journal.

Tax account on credit notes: The account that will be set on invoice tax lines for credit notes. Leave empty the field to use the expense account.

Under Advanced Options Tab,

Label on Invoices: This can be used on the invoice report to represent this tax. One can add custom tags to create custom reports.

Included in analytic cost: If we set this option, then the amount computed by this tax will assign to the same analytic account mentioned the invoice line.

Included in price: Set this option if this tax is included in the unit price of the product/service.

Affect base of subsequent taxes: If you set this option, Base amount of subsequent taxes will be sum of current base amount and tax amount of this tax.

Tax adjustment: Set this option if you want this tax to be used in tax adjustment wizard.

Group of taxes: This option lets us configure the tax as collection of many child taxes. Odoo will make visible the table to select the child taxes when you select this option as tax computation method.

One can also create new tax via clicking on the create BUTTON, under the Tax menu.

Configuring Fiscal Positions in Odoo

Odoo can handle Multi Company and multi-currency concepts. This feature is for helping the business organizations who are dealing with outstation clients, be it the Customers or the Suppliers. Both team may be operating from another country or states. Therefore, the laws and regulations with respect to taxes will be different for each other. Fiscal position comes in handy for such business circumstances. Using Odoo’s fiscal position one can seamlessly map taxes and accounts specific to that country.

Configuration:

Go to Accounting > Configuration > Accounting > Fiscal Position

Upon clicking, you will be navigated to a new window like below image:

One can either create a new fiscal position corresponding to the nation of your supplier/customer or edit/use the existing fiscal positions in Odoo.

Tax Mapping: Tax mapping is another useful option to configure taxes. For example, imagine a product have 10% tax rate in one state and 15 % tax rate in another state. Using Tax Mapping and Accounts Mapping one can easily manage them under Odoo fiscal positions.

Configuring Journals in Odoo

All your bookkeeping sections or accounting entries need to show up in an accounting journal. An accounting journal is a record of transaction exchanges requested by a date. So you ought to make a Sales Journal for customer invoices, a Sales Refund Journal for customer credit takes notes, a Purchase Journal for supplier invoices, a Purchase Refund journal for supplier credit notes and a Bank Journal for bank exchanges. However, one can also add different journals in Oodo.

Configuration

Go to Accounting > Configuration > Accounting > Journals.

Upon clicking Journals, you will be navigated to a new window, where Odoo enlists with different Journal Types like Customer Invoices, Vendor Bills, and more.

Upon clicking the create button, you can add a new accounting journal in Odoo.

The creation form includes:

Journal Name: The field defines the name of the accounting journal.

Type: There are five types of journals in Odoo.

  • Sale: Select Sale for customer invoice journal.
  • Purchase: Select Purchase for Vendor Bills
  • Cash: Select cash for journals that are used in customer or vendor payments.
  • Bank: Select Bank for journals that are used in customer or vendor payments.
  • General: General for miscellaneous operations journals.
Under Journal Entries Tab:

Short Code: Odoo will create a sequence number for each journal we create. Journal entries of this journal uses this short code as the prefix of generating sequence.

Next Number: The next sequence number will be used for the next invoice.

Default Debit Account: It is the default account for debit amount.

Default Credit Account: It is the default account for credit amount.

Configuring Incoterms in Odoo

Incoterms is the abbreviation for International commercial terms. Fifteen terms of sale are accepted worldwide in a task of expenses and responsibilities among purchaser and merchant. Essentially, Incoterms are exchange/trade terms distributed by the International chamber of commerce(ICC), and it is widely used in both global(international) and local (domestic)exchange contracts. In other words, Incoterms divide the transaction costs and responsibilities between the buyer and seller and reflect the state of art transportation practices.

Configuration

Go to Accounting > Configuration >Accounting > Incoterms

Upon clicking the Incoterms, you will be navigated to a new window just like below image:

Odoo rundown a list of Incoterm for your business, however one can create a new Incoterm via clicking the CREATE button.

Upon clicking the create button, you will be navigated to a new wizard, where you can give the following attributes.

Name: Incoterm Name

Code: Incoterm Standard Code

Configuring Payment Terms in Odoo

Business organizations often indulge in different payment collection and different payment making methods. Under many cases, the payments to suppliers or the payments from customers comes as installments. To help the business with that case of payments, Odoo offers with certain set of features envisioning different configurations and different payment methods. Under Odoo, it is titled as Payment terms. One can set different payment terms in Odoo and utilize them for both customer bills and vendor bills.

Configuration:

Go to Accounting->Configuration-> Management->Payment Terms

Upon clicking the payment terms option, you will be navigated to a new window just like below,

One can use different payment terms like, immediate payment, 30% advance and balance after one month, etc. depending on different situations.

Via clicking on CREATE button, under Odoo one can create new payment term depending on the business operation.

Here one can create a new payment term, say “20 % advance within 3 days and balance in 10 days”

Later give a payment term description detailing the payment term in the provided space. The end user can see that this description will be displayed in the invoice or the sale order.

Later add the terms, click on 'Add Item' and add the details of the term. Please note that the last line of terms always should be the 'Balance', otherwise a warning message will be displayed while attempting to save the payment term and we can’t save it.

When we add a new line, we will get redirected to the following wizard.

From the wizard, one can choose the Term Type and the Due Date computation method.

Under Odoo there are 3 kinds of Term Type,

  • Balance
  • Percent
  • Fixed Amount

One can select the term type according to the business need.

Just below the Term Type, there is the option for selecting the Due Date computation method for that particular Type. The options are explained below.

Day(s) after the invoice date: The amount should be paid within the specified days after the invoice date.

Day(s) after the end of the invoice month (Net EOM): The payment should be made within specified days after the end of invoice month.

Last day of following month: The amount should be paid within the last day of following month

Last day of current month: The amount should be paid within the last day of current month

Upon setting the terms, click SAVE button for saving the particular payment terms. After this, one can seamlessly set the particular payment term in Partner master or Sale order or Invoice.

One can set the payment terms in:

  • Sale Order or Quotation
  • Invoice
  • Partner Master. Upon selecting partner, the payment terms will be automatically added to invoice or sale order.

Configuring Follow-up levels in Odoo

It is fundamental for your business to gather installments or collect the payments when they are past due. Odoo will enable the end user to recognize payments that are late and will enable the end user to send appropriate reminders.

Configuration

Got to Accounting->Configuration-> Management->Follow-up levels

By default, follow-up plan is made accessible in Odoo, however one can tweak it any way you need. Depending upon the number of past due days, plan to send an email, a letter or to attempt a manual activity, one can customize their follow-up level in Odoo. You can likewise alter the format utilized for the announcement as indicated by the phase of the procedure.

Deferred Revenue Types in Odoo

Deferred Revenue is an advance payment recorded on the beneficiary's balance sheet as a liability account until either the administrations/services have been rendered or the products have been conveyed. In other words, deferred revenue is an advance payment received by a company. However, it is not yet revenues so cannot be reported on the income statement. Deferred revenue thus acts as a liability account since it alludes to income that has not yet been earned. However, as products and services are conveyed over time, the income is recognized and posted on the income statement.

Configuration

To configure the deferred revenues, go to the Settings menu under the module Accounting,

Accounting -> Configuration -> Settings -> Automated Entries, then enable the option Deferred Revenues management.

However, before registering your first deferred revenue, one must define the types. For that,

Go to Configuration -> Deferred Revenue Types.

Create a new deferred revenue type by clicking the “Create” button.

Upon clicking create button, a creation form will appear like below:

Under the form, one can specify the type of Deferred Revenue, Company name, Journal, Deferred Revenue Account, Recognition Income Account, Recognition Account, Number of entries and One Entry Every.

The additional options include:

Auto-Confirm Assets: Tick this if you want to automatically confirm the assets of this category when created by invoices.

Group Journal Entries: Tick this if you want to group the generated entries by categories.

Depreciation Dates: The way to compute the date of the first depreciation. There are two ways in Odoo:

  • Based on last day of Purchase Period: Here the depreciation dates will be based on the last day of the purchase month or the purchase year(depending on the periodicity of the depreciations)
  • Based on Purchase Date: Here, the depreciation dates will be based on the purchase date.

Deferred Revenue account is a current liability account, it contains revenue that has been earned.

Create Deferred Revenue Manually

To manually register a deferred revenue, go to the menu Accounting -> Management -> Deferred Revenues

Upon clicking the CREATE button, you will be navigated to a new window, where you can customize your deferred revenue.

The creation form will look like below:

Here one can set the Category of asset, Date of asset, Gross Value of asset, Customer, Invoice etc. Upon the action, one can see that the residual value gets automatically set as same as of the gross value.

Under the Revenue Information tab,

Odoo specifies two option for Time Method

Number of Entries: The field to input the number of deferred revenue line required to get displayed.

Ending Date: If selected, it displays the end date field. Provide the date you need - which deferred revenue should end in that field.

Once you choose the Time Method as Number of Entries, your revenue is created, don’t forget to Confirm it. You can also click on the Compute Revenue button to check the revenue board before confirming the revenue.

After that check the Revenue Board.

Here you can see the deferred revenue. If you want to control the revenue board, Click on red bullet. It changes to orange bullet denoting that journal entry has been created for this line.

And you can also post journal entries before the expected date via clicking on the orange bullet and forcing the creation of related revenue entry.

Create Deferred Revenue Automatically from Customer Invoice.

Deferred Revenue can be automatically created from a customer invoice. All you need to do is set a deferred revenue type on your customer invoice line. When the user validates the invoice, deferred revenue will be automatically created, using the information of the customer invoice.

Once the customer invoice is validated, Odoo will automatically create a deferred revenue for you, and the related journal entry.

How to Modify an existing revenue in Odoo?

1. Click on Modify Revenue

2. Change the number of revenue

Odoo will automatically re-compute a new revenue board.

Analytical Accounting in Odoo

Tracking expenses and revenues are one of the standout internal procedures a business association can use. In analytical accounting it depends on financial information to make conclusions about how, when and why a business spends and gets cash. Odoo comes supportive to analytic accounting. With Odoo analytic accounting, one can create analytic accounts, analytic tags without having to create more accounts in charts of accounts.

Odoo’s analytic accounting can be utilized for many purposes like analyzing the cost of company, re-invoicing the time to a customer, or even for analyzing the performance of a service or a project. Odoo’s analytic accounting allows the end user to generate reports that give the insights end user need and look at the at the transactions from a different perspective. One can analyze how profitable that a custom creation is, and how much we spend across different departments.

Configuration

Go to Accounting->Configuration->Settings->Analytics. Activate both Analytic Accounting and Analytic Tags.

Firstly, create a new analytic account. For that you can either click on the menu Analytic Accounts under Analytic Accounting or go to Configurations->Analytic Accounts under Analytic Accounting section.

Click on CREATE button to create new analytic account.

Under the creation form, one can give analytic account name, Reference, Group (this will be a group where one can add multiple analytic accounts and get the results for all these accounts).

Upon clicking the option CREATE AND EDIT, one can create new group in the analytic account.

Here one can name the company, add the parent group and discussion and also select company.

CLICK on SAVE button to mark changes.

Next, go to vendor bills.For that Accounting->Vendor Bills.

Create a new one via clicking on create button.

You can add the analytic account for the product under the vendor bill. Further VALIDATE.

Once you validate this, One can go to the Accounting->Analytic Items.

The analytic items are like journal items, but for analytic accounting. So let’s group by Analytic account.

Upon filtering you get, the analytic items nicley organized, making you see everything this way like below image:

And if we go our analytic account, we created, we see all entries that are linked to analytic accounts are displayed here. Upon clicking the item you have all the information, just like below : Now Go to

Analytic Reports in Odoo

Odoo provisions to see all the balances for all the analytic accounts for a specific period.

Configuration

Accounting->Reporting->Anlytic Reporting

Here the end user will be able to see all the analytic accounts on the left side and their balances on the right.

As you see in the above image, the end user will be able to see all the balances for all the analytic accounts during a specific period or for a specific period. Odoo also provisions to filter the analytic reports via clicking the date icon

One can filter the reports for a month, for a quarter, for a financial year, last month, last quarter, last financial. One can also customize the period via setting start date and end date.

To view the balance of the group under analytic accounts, choose the option Hierarchy and Subtotals

Via clicking on,one will be able to see the balance for all the groups created under analytic accounts.

Upon selecting the group, one can view the analytic accounts that are marked and the individual balances for these accounts.

Via clicking on the PRINT PREVIEW button, the end user can avail the pdf copy of the analytic report.

Upon clicking the EXPORT (XLSX), you get to the excel sheet of the report.

Profit and Loss Report of the Analytic Account

To avail the profit and loss report of the particular analytic account, go to Reporting->Profit and Loss

Upon clicking the PROFIT AND LOSS, you get navigated to a new window, where you see the basic Profit and Loss Report.

However, one can easily acquire the profit and loss report of the analytic account via giving entries in the analytics icon on top, as cited in the below image.

You can select the analytic account you created under the account column and view the profit and loss report for the same without any complexity.

Analytic Tags in Odoo

Analytic Distribution is mainly utilized for margining the business costs/income among different analytic accounts created in Odoo. One can easily configure this division need in Odoo using Analytic Tags

configuration

Accounting->Configuration-> Settings-> Analytics->Analytic Tags

Budget Management in Odoo

Budget management plays a vital role in marking business success. Utilizing Odoo accounting budget management, one can efficiently track and monitor the financial status with its planned details. Odoo utilizes the general and analytic accounting in their budget management.

One need to configure three things to work with Odoo budget management

  • Budgetary Positions
  • Analytic Accounts
  • Budget

Budgetary positions are moreover a kind of mapping the general accounts with budgets. In order to create a budgetary position, one can go to

Accounting>Configuration>management>Budgetary Position

Here, one can define accounts linked to the budget.

Click on Select.

Save the changes in order to confirm the Budgetary position of yours. One can follow the very same steps for making revenue budgetary position. Only thing one need to remember is, in that case select the relevant income accounts.

Analytical Account

Odoo has to realize which expenses or costs are applicable to a predefined budget. To do so we have to link the invoices and costs to a defined analytical account. One can create the analytical account by entering the Accounting module and clicking Configurations ‣ Analytic Accounting ‣ Analytical Accounts.

Next step is setting budget.

To set budget targets, go to accounting app, select Accounting ->Management->Budgets and create a new Budget.

Note:

In the Budget line, the field Analytical account is set as not mandatory by Odoo. But for the proper working of Budget 'Analytic account' is mandatory. So, don't forget to put the Analytical account in the Budget lines.

You can create a new analytic account or select an existing analytical account from the budget lines. Later confirm the budget.

Configuring Budgetary Positions in Odoo

Overseeing budgets is seen as a fundamental element for sustaining a business. It enables the individuals to quantify the real financial performance against the arranged one. Odoo deals its budget utilizing both General and Analytic Accounts.

Budgetary Positions

Budgetary positions are the general accounts for which you need to keep spending plans (regularly cost or salary accounts). They should be characterized so that Odoo can know, which accounts he needs to go get the budget data. Some may be as of now introduced with your chart of accounts.

Configurations

To define the budgetary positions, go to Accounting->Configurations->Management-> Budgetary Positions.

The end user can define here in the field; which accounts relates to the project's expenses. One can make a position and add a line to select accounts.

Upon clicking Add a line button, you will be navigated to a new wizard, from where you can choose the specific number of accounts used.

Click on Select and Save the changes to conform Budgetary Positions in Odoo.

Repeat the very same steps for creating revenue budgetary position. However here, one can only select the relevant income accounts.

Accounting Dashboard

As soon as your open the accounting dashboard, you would find some short cuts to configure the accounting module. However one can remove the configuration panel via clicking the “x” option provided on right end.

One can use the above shortcuts for configuring the Company Data,Bank Account, Fiscal Year and Chart of Accounts.

Apart from the above shortcuts, one can also view the journals and other info from the accounting dashboard

Upon clicking the SELECTION button you get another options as well.

You also get automatically the filter favorites options to configure the dashboard view.

Creating Customer Invoices

Contingent upon your business and the application you use, there are various approaches to automate the customer invoice creation in Odoo. In usual scenario, draft invoices are made by the framework (with data originating from different reports like sales order or contracts) and accountants simply have to approve/validate the draft invoices and send the solicitations in batch (by customary mail or email).

One can either create a customer invoice directly from the dashboard via clicking on NEW INVOICE button or via going to the CUSTOMERS section in the accounting tab and selecting INVOICE option

Upon, clicking the NEW INVOICE button, you will be navigated to a new window with a creation form like below.

The field includes the following attributes

Customer: You can find a contact by its name, TIN, Email or Internal Reference.

Delivery Address: Delivery Address for Current Invoice.

Payment Terms: If you use payment terms, the due date will be automatically computed at the generation of accounting entries. If you keep the payment terms and the due date empty, it means direct payment. The payment terms may compute several due dates, for example 50%now,50%in one month.

Invoice date: Keep the empty to use the current date.

Due Date: If you use payment terms, the due date will be automatically computed at the generation of accounting entries. The payment terms may compute several due dates, for example 50%now and 50%in one month, but if you want to force a due date, make sure that the payment terms are not sent on the invoice. If you keep the payment terms and the due date empty, it means direct payment.

Sales Person: Under the field, one can assign the sales person authorized for deal.

Sales Team: Defines the Sales Team authorized for the deal.

Currency: Currency used for the transaction.

Under Invoice Lines Tab, one can add the products the customer desires to buy, description if any, the account you configured for the deal, and more.

After entering all the details, click VALIDATE button on top

And Register the payment via clicking the option, REGISTER PAYMENT.

And validate again.

And as you scroll down to the bottom, you can see that the invoice has been paid for.

And upon clicking the green little icon, you get acquainted with more information about the payment. One can see that this payment invoice has been reconciled together. And, in case if one needs to un reconcile, all they have to do is click UNRECONCILE.

Also one can view the invoice via clicking the VIEW button.

Going back to the invoice, Under Other Info Tab,

The attributes include: Journal Name, Partner account user for the invoice, Payment Reference(the communication automatically populated, when an invoice validation is done).Reference/Description(the name that will be used on account move lines),Incoterm(a series of pre-defined commercial terms used in international transactions),Fiscal Positions, Website(through which the invoice was created),Intrastat Country(Arrival Country),Bank Account to which the invoice will be paid(A company bank account if this is a customer invoice or vendor credit note, otherwise a partner account number).

However, one can see the journal entry that was automatically created for the invoice.

Upon clicking them, you have a journal entry with debit and credit balanced.

Now if you go to Customers-> Payments

You can see a list of payments under the PAYMENTS category.

Upon clicking the desired payment, you will be navigated to a new window, from where you can access the corresponding journal items and also the invoices.

Upon clicking the Journal Items, you can see that the client paid a certain amount and that amount is debited in the on the bank account, and also it is credited in the account receivable.

And there is a balance between the CREDIT and DEBIT.

To view all Journal Eateries,

Configuration

Got to Accounting-> Accounting->Journal Entries

This is where you can create the journal entries manually.

As you see in the above image, By default the filters would be MISSCELENEOUS OPERATIONS.

To create a new journal entry, click the button CREATE.

Vendor Bills To Payment In Odoo

When the vendor bills are registered or enlisted in Odoo, one can without much of a stretch pay vendors the correct amount at the right time (not too late, not very early; contingent upon the vendor policy). Odoo likewise offers reports to follow your aged payable balances.

On the off chance that you need to control vendor bills received from your vendors, you can utilize the Odoo Purchase application that enables you to control and pre-complete them consequently dependent on past buying/purchase orders.

configuration

It can be done in two ways. Either the user can avail the New Bill feature under the Vendor Bill section from the accounting dashboard.

Or go to Accounting->Vendors->Bills.

Upon clicking the NEW BILL Button/Bills under the vendor option, you will be navigated to a new window like the below image.

Here, you can register the new vendor bill via choosing the vendor and contributing their invoice as the Vendor Reference. Later add and confirm the product lines, making sure of correct product quantities, taxes/expenses and prices.

One can however configure the account to which the project is linked via clicking the Account section,

Or from the project template, via going to the accounts tab and clicking expense account.

Save the invoice to update the pre expense and tax amounts at the base of the screen. You will need to configure the product price without taxes as Odoo will compute the tax duty for you.

Validate the Vendor Bill via clicking on validate button.

Correspondingly, a journal entry will be crafted dependent on the invoice. This journal entry may vary contingent upon the accounting package you choose to use.

For most European nations, the journal entry will utilize the accompanying records:

Accounts Payable: characterized on vendor form

Taxes: characterized on the items and per line

Expenses: characterized on line item utilized

For Anglo-Saxon (US) bookkeeping, the journal entry will utilize the accompanying records:

Accounts Payable: characterized on the vendor form

Taxes: characterized on the items and per line

Merchandise Received: characterized on product form.

One can check the Profit & Loss or the Balance Sheet reports after validating few vendor bills.

Pay a bill

For making the payment, click on the option Register a Payment at the top of the form.

From there, one can choose the payment mode like Checking account, credit card, or more and the corresponding amount the end user wishes to pay.

Click on validate to get it PAID.

Reporting

Aged payable balance

So as to get a rundown of open vendor bills and their related due dates, one can go for Aged Payable report, under reporting menu.

Configuration

Reporting ‣ Business Statement ‣ Aged payable.

From here, one can click directly the merchants name to open up the details of every outstanding bills and the sums due, or you can comment on any line for managements information. Anytime while you're glancing through the report, you can print straightforwardly to Excel or PDF and get precisely what you see on the screen.

Cash Rounding Methods in Odoo

Cash Rounding is conducted when the base unit of an account is smaller than the most reduced denomination category of the currency. The payable sum for money exchange is adjusted to the closest various of cash unit accessible, through exchanges paid in different ways (eg: cheques, credit cards) are not adjusted.

In any business, cash rounding is an important feature. This feature enables the vendor to round off the cost of any request while installment is made. Cash rounding is supported in Odoo, it is used to round the total amount of a bill to the nearest 5 cents. This helps the vendor in creating a bill with a rounded total amount.

To enable the rounding function, Go to Accounting module -> Configuration -> Settings -> Invoices -> check Cash Rounding.

One can either select it from here or can go to Accounting module -> Configuration -> Management -> Cash Rounding.

Upon clicking create button, one can create a new cash rounding method in Odoo.

The creation form will have some following parameters:

Name: Name of rounding.

Rounding Precision: Precision of a numeric value describes the number of digits that are used to express that value, including digits to both the left and right of any decimal point. The rounding precision will affect the rounding of the computed value.

Rounding Strategy: You can do cash rounding by using two strategies.

1. Modify tax amount: Add the rounding to the highest amount of tax.

2. Add a rounding line: Add the rounding in a new line.

Account: It defines an account, where the rounding will go.

Rounding Method: You can do 3 types of rounding methods in Odoo.

1. UP: Value round towards plus infinity based on the rounding precision.

2. DOWN: Value round towards minus infinity based on the rounding precision.

3. HALF-UP: When the fraction part of a value is greater than or equal to 0.5, then round half towards plus infinity otherwise round half towards minus infinity.

Bank Statement and Reconciliation

Bank reconciliation is the process by which a person’s accounting records with respect to cash account is matched with the information of his bank statement. The main aim of the process is to find out the difference between these two records so as to keep the accounting records as appropriate as possible. The bank information encompass the record of all transactions carried under a person's account for a month. The reconciliation process should be carried out at regular intervals so as to ensure that a company’s cash record are correct, immune to fraudulent activities and also mitigation of problems with respect to bounced checks and overdraft fees.

Odoo enables easy linking of your invoices and all other payment details with the bank statements without hardship. The reconciliation methods in Odoo are carried in two formats;

  • Direct registering of payment with invoices.
  • Open invoices reconciled with bank statements.

Step 1: Make Bank Payment

First of all, create an Invoice for the customer.

For that go to Accounting->Customers->Invoices

After creating the Invoice, save and click ‘Validate’. Now the invoice will be in 'Open’ state. When the customer makes the payment, click “Register Payment’.

In the above image, one can see the payment proof of 2100 euros issued to a customer ‘Smith and Co’ has been received. Now we can start with this invoice of 2100 euros. Since product is sold, payment is demanded immediately.

A company accountant handles the bank statements only on weekends, correspondingly the invoice will be marked as paid. It is done so as to remember that the service with our customer can be started. Payment confirmation is send from the customer side, so payment registration can be done and the invoice can be marked as paid.

If clicking the REGISTER PAYMENT option, it is marked in Odoo software that the invoice is paid. The payment method, payment amount and payment date has to be specified here.

To find the payment back from the invoice follow the below mentioned steps; Click on info > open payment.

Now the invoice will be paid and the reconciliation process will be automatically done along with

Bank statement reconciliation case

Let’s take an example in this case too. Here, we can see an issued invoice of 3000 euros for Smith and Co. Note that there are other invoices also seen in the screenshot, assume these invoices are open for other customers.

Now look at the screenshot, we have received our bank statement. Invoice of Smith and Co and buzz has been paid here.

Now we have to import or create bank statements. From the banks feed section, the documents have to be referred.

There will be an option in the dashboard to reconcile X number of items (X denotes the number of items we want to reconcile), click on that.

If the mentioned name of the partner, the amount entered etc. are correct, Odoo software automatically execute the reconciliation process.

The above image shows the successful execution of reconciliation process.

Now, suppose if some issues happen during the process, like the partner name missing out, amount getting mismatched, in that case, one has to make use of manual actions.

Suppose if the partner name is not there in the bank statement, there you have to manually enter it.

If down payment method is adapted, one have to check if it is right and then payments should be validated accordingly.

There is an option to reconcile balanced items in the sheet. For that press CTRL-enter.

Reconciliation model creation

Two model reconciliation entries are configured first. To do this follow these steps;

Open application dashboard > open your bank journal > select more > reconciliation model.

The bank fees should be such that, we shall be able to book it very easily. Banks always deduct fees according to our balance, which will vary every month.

Now a button label called bank fees has to be created. This is shown in the above image, here one must specify the amount type as percentage of balance and the amount to 100 percentage. After doing this, the parameter will be set and this will make Odoo to take entire fee in to the account. SAVE the changes.

Payment registration on reconciliation model

By importing the bank statement, one can register their payments which will be changed by payment of the bank fee.

During the reconciliation process, select open balance. Then click on reconciliation model, here it is the bank fees. After doing this, one will instantly get the relevant data. To finish the process, click on reconcile.

Multi-currencies in Odoo

Utilizing the option, multi-currency in Odoo will enable the end user to send sales invoices, quotes and purchase orders, also receive bills and installments in monetary standards other than your own. With multi-currency, you can likewise set up financial balances in different currency forms and run reports on foreign currency exercises.

Configuration

Go to Accounting->Configuration->Setting->Currencies->Multi-currencies

Turn on the option Multi-currencies under currencies tab. Click SAVE button to mark the changes.

To see few more features, click Activate Other Currencies option.

Here you can see that there already few currencies activated. One can further click on the new currencies and activate them also in case of need.

EXCHANGE GAIN OR LOSS JOURNAL

The option records the contrasts between the payment registration and the expected amount. For instance, if an installment is paid one month after the receipt was issued, the conversion/exchange scale has presumably changed. The fluctuation infers some misfortune or benefit that are recorded by Odoo.

Odoo provides with different options like Miscellaneous Operation, Exchange Difference, Cash Basis Tax Journal, Stock Journal. One can also CREATE AND EDIT new one.

Automatic Currency Rates in Odoo

By default, the currencies have to be changed manually. However, under Odoo , one can synchronize it with different exchange service like Yahoo, Europe Central Bank and more.

One can also set the interval for conversion like: Manually, Daily, Weekly or Monthly.

One always trigger the update via clicking on Update Now.

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