Newbie question:: Typical default accounts in "standard chart with numbers"?

ERPNext Accounting
1

Hi.

I’m completely new to ErpNext.

Background:
The company needing it will probably not adopt the full accounting aspect of ERP until 2021.
In the meantime we need handle only: products, customers, invoices & delivery notes, suppliers and payments. This data will be exported to our third party accounting firm.

I’m an experienced software developer, with a very poor understanding of accounting. My role will be to develop some specialised CRUD for product management and be the in-house problem solver for ErpNext.

Question:
Even though we won’t be making use of the accounting side of ErpNext, there are tasks that won’t work properly unless certain settings are correct. For example, when creating a first stock item I get "Please enter Difference Amount ".

For that, Muzzy said “Make sure all the default accounts are setup in company before starting to upload/create any information. Go to Accounts> Company to fill it.”

So I looked into that and, at this point, after Googling a fair bit, I still don’t know which default account maps to “Difference Amount”, how to find that out or even what a difference amount means for a stock item.

Is there somewhere I can find, or would someone kindly provide, a list of the initially undefined default settings that will trip me up (as I evaluate ErpNext for our needs) and some suitable settings to use for them?

2

I will try to keep it simple. Every entry in accounting has a debit and credit.
When performing a stock entry an accounting entry is also processed.
If amount of stock debit is not equal to stock credit the remaining amount is put into difference account.

Debit= 2USD Credit= 1USD. DIFFERENCE ACCOUNT = 2-1= 1USD in credit side

You can set default difference account in customize stock entry and setting defaults for difference account field.

Please see docs how to customize docs

3

Mohammad

Thanx very much for explaining that.

Could you also clarify what would cause the difference? Is it something like theft &/or breakage, or are you referring to the wholesale value of an unpackaged item in Stores versus the estimated cost to produce of an item in Finished Goods?

4

The other part of my question was “default company settings”.

Here’s the list of default settings and the accounts I chose for them by guessing.

I hope you don’t mind helping with

  1. Do they look right to you?
  2. Which one is used for inventory differences?

ACCOUNTS SETTINGS

Default Cash Account
1110 - Cash - IB

Default Receivable Account
1310 - Debtors - IB

Round Off Account
5212 - Round Off - IB

Round Off Cost Center
Main - IB

Write Off Account
5218 - Write Off - IB

Discount Allowed Account
5121 - Default Discount Allowed - IB

Discount Received Account
4131 - Default Discount Received - IB

Exchange Gain / Loss Account
5219 - Exchange Gain/Loss - IB

Unrealized Exchange Gain/Loss Account
5219 - Exchange Gain/Loss - IB

Default Payable Account
2110 - Creditors - IB

Default Employee Advance Account
1610 - Employee Advances - IB

Default Cost of Goods Sold Account
5111 - Cost of Goods Sold - IB

Default Income Account
4110 - Sales - IB

Default Deferred Revenue Account
1310 - Debtors - IB

Default Deferred Expense Account
2110 - Creditors - IB

Default Payroll Payable Account
2120 - Payroll Payable - IB

Default Expense Claim Payable Account
5201 - Administrative Expenses - IB

5

For example your stock value is 10usd and it gets damaged by any means and the stock value is reduced to 7 usd. The 3 usd will go in difference account in this case it can be stock expense or damaged stock expense.
In case of theft when you reconcile your stock it was 80 usd how ever it should have been 100usd in that case 20 usd will be the difference account.

6

Defaults account for difference is not available in the settings. You have to manually customize the Doc and in the difference account field you have to set you desired account as default value.
Please have a look on these docs
https://erpnext.com/docs/user/manual/en/customize-erpnext/customize-form

7

Mohammad,

I very much appreciate your help with this, but forms customization is far down my list of priorities right now.

The main thing now … I am looking into the data API in order to see how I can automate injecting our existing system’s data periodically, to facilitate working both systems in parallel for a while.

To do that I need to be sure I have dealt with all obligatory default settings. If I fail to do that the API will probably be less friendly than the user interface in explaining why some data won’t enter correctly.

8

You are trying to maintain data among your platform but what exactly you want to do with that can you be more specific on detailing out?

9

Hi Chaitrali

I am actually not asking for help with synchronizing data between two systems. I’ve been doing that kind of thing for decades.

It turns out that the API works very well. I started looking at it an hour ago, and I have already created a new customer.

Next task is to try to add an invoice from the old system with references to customers, stock items, tax templates, etc.

If I run into difficulties I’ll start a new topic here.

10

Okay but syncing between two platform sometime really creates big headache always have to be on top of latest data to be on both platform for any descripency

11

Every night we will entirely wipe all data from ErpNext and import all necessary data from the legacy system. Task results will be compared at the end of each day and corrective measures taken. Next morning corrected tasks will be retested and testing of further untested tasks begun.

When all tasks produce equivalent results, we’ll kill the old system.