u sure? There is a field to choose from credit/debit when using a .csv template to import accounts. … but yeah you are maybe right, that seems not to be mandatory to use. Well then it would just be a question of Setting up a template.
EDIT: just started making one here
Mixed accounts are important because based on their balance where they appear in the accounts is determined. For instance bank overdraft is not a negative current asset but a current liability. Not having it in current liabilities means your accounts are quite simply wrong. They are wrong because any ratio that uses the ratio of assets to liabilities is wrong and that is a basic analysis tool of anyone reading financial statements of which IFRS seeks to ensure that accounts are presented in a consistent manner to allow those interested to make informed decisions/assumptions. Without them accounting means nothing. Within a Organisation you provide context outside Financial Standards and the notes in the Accounts provide that context.
Point taken @eamonn, but I am still not sure how the accounting in ERPNext is not providing for the account being either mainly on the dr. or cr. side. What should change?
@Francois_Ifitwala In a discussion about what ERPnext needs to do to be IFRS compliant then mainly really isn’t enough. It’s quite down the line either it is or isn’t. And it isn’t. As for what you do. I’m not a programmer but my process for dealing with this would be:
It seems like a simple logical process to me but I’ll not be coding it. Of course you can handle it by creating a bank overdraft account and journalling the balance out if it is overdrawn to the other account when you draw up the Balance Sheet however that is a workaround that is bound to end in tears not least as the business carries on whilst the Accounts Dept are drawing up the financial statements with new transactions hitting the bank account and with no single account now showing you your current bank balance it all gets a bit confusing.
You can always move the parent of an account in CoA. I don’t see this is an issue.
@rmehta OK that’s fine and a simpler and much cleaner solution than journalling however it is a manual process that needs to be remembered every time the financial statements are drawn up and a process that no other accounting software I have ever used before forces on the user. That unexpected behaviour will be off putting to professional book keepers and accountants and not appreciated by smaller businesses doing the accounts themselves who will potentially end up with a misleading view of their financial position.
As I said the logic is simple so if the programming is as simple why not sort it instead of worrying about new features. If you the the basics right then your software will be in a much better position and this is basic!
As to IFRS structure is everything so that is just one example. As I mentioned before you need a way to order the accounts in the chart of accounts in order to make then compliant. Again you have to go against the basic design and add a number scheme to the accounts in order to allow that so just put the number scheme in. It’s not old fashioned it’s needed to provide structure and if you can’t see the importance it’s because you don’t understand accounting. How do you set the order of liquidity within the charts of accounts without numbers? If you can’t answer it using your current name based approach then that’s the problem. The problem isn’t the numbers but the lack of consistency in following basic accounting rules which is one of the first things a book keeper or accountant is taught when learning the subject.
What all this just says is that the basic principles of accounting are not well understood where fudging the basic design becomes the norm. The norm should start with accounting standards if you want to be compliant with them and bring the software closer to expected behaviour! Needless oversimplification only leads to everyone that understands the imperfections to make changes that should be there. What a waste of everyone’s time and I don’t think that’s what you want.
I think you genuinely have a great product however I do think that the accounting is very hard work and that’s without even going in depth with it.
@Rushabh, regarding the standards for charting accounts based on credit or debit balance, I do think it will be far from ideal to have to manually change parent accounts every time a financial report is drawn up! Having some options to select where an account should appear in the report based on its balance (debit or credit) would be a much neater approach
Also, the order of liquidity is quite significant when it comes to standards. Much as I love the existing naming system (probably because I’m not an accountant by training), it will likely be better for the product (and ultimately for the end-users) to have a way of ordering accounts which traditionally has been by numbering
Just a few months back, I was invited to make a presentation for a medium sized organisation trying to decide between ERPNext and Sage. The only issue that the consultant hired by the organisation had with ERPNext was the lack of a numbering system for the accounts
I love ERPNext for its simplicity and ease of use but it’s becoming obvious now that there’s increasing interest and attention in the product from organizations at different levels. Standardization is inevitable for a product as dynamic and endearing as ERPNext. Adding a numbering (or ordering) system for Accounts takes nothing away from the product; those who don’t need it can ignore it and those who require more standardized reporting can use it. At least consider putting this on your to-do list
Finally, as much as having connectors to more established applications is great, Accounting is central to the functionality of an ERP. For many organizations, the whole idea of implementing an ERP in the first place is to do away with the use of multiple systems! Yes, I know that connectors give some level of integration but nonetheless, I would just like to advise that the team continues to concentrate more on improving the functionality of the in-built Accounting package
As always, I continue to be grateful for the awesome product that is ERPNext and the even more awesome team behind it 
Kind regards,
This should be an easy customization / fix
Is there any option on erp next to add Parent account on chart of account because we want to add one parent account which is COST then it will have 6 parent accounts
1,asset 2,liability 3,equity 4,income 5,cost,6, general expense
so we can have net profit report and gross profit report.
thanks
IFRS requirements global progress:
131 out of 143 countries use IFRS standards for large companies, with 119 countries requiring IFRS exclusively.
80 out of 143 countries use IFRS standards for small business.
In total, 133 out of 143 countries have committed to IFRS standards.
Source: http://www.ifrs.org/Use-around-the-world/Pages/Analysis-of-the-IFRS-jurisdictional-profiles.aspx
Implementing IFRS is not just about having a chart of accounts embedded to the system. ERP Next allows to develop and insert required accounts manually towards the user’s needs.
More important is to implement such macro-level miodules, as assets and depreciations, goodwill accounting, financial instruments, foreign exchange transactions, consolidations. So, my proposal is to keep this thread alive by bringing the specific sugestions on what IFRS items should system have.
Now you can contribute the chart of accounts for your country via Contribute Chart of Accounts for your country
@rmehta @nabinhait Trust you’re doing great. Any update on adding an account numbering system? I just saw a thread where one user seems to have worked out a temporary solution:
Could you consider incorporating this as a stop-gap measure?
Kind regards,
@wale thanks for prompting this issue of the Account number…
I was the one adding the temp solution but since then I have not done any testing or entered any Data as I am still trying to have one Finance guy from Angola to give the Chart we use here and see how can we implement on ERP…
@rmehta If not mistaken if I delete the template created on the Chart some code will fail to work well as they are used a conditions to add or subtract from one document to another … but can we make a scenario like the user selects the type of Chart to use (with account number as first field or without) and of course leaving the existing Roots as guidance for the system.
Is a petty that I am not an accountant otherwise I would already finished the Chart for Angola and the would give you an Idea of the issues that this format could give.
Looking for feedback from other users on proposed IFRS-compliant CoA
any progress On IFRS issue and multi company consolidation report?
hi everyone,
I have some question regarding IFRS compliance on ERPnext and other question about equity. so here’s the question:
Hello everyone,
ERPNext being on Frappe allows you to customize it and be compliant with any standard. I suggest we create a project to incorporate IFRS requirements.
For example, implementing IFRS 15 which takes effect Jan. 1, 2018, needs to modify Invoicing or client entry, requiring a 5 step model to recognize the Revenue.
Another one on IFRS 16, which requires removal of the account Rent Expense and recognizing your right to a leased asset. ERPNext can be modified to accommodate this, especially if there is a need for PV computations.
Accounts can be reclassified to whatever you want in the system. With the introduction of account numbers, this can be managed even better.
Has anyone found a workaround to the negative bank balance/OD? Best that this be shown as current liability and not negative current asset as liabilities are understated