COA - Traditional Accounting

Below is list of some of the concepts that will undergo a change as you move to ERP from a traditional or manual way of accounting:

1. There exists just one segment of accounts and they are classified as Assets, Liabilities, Shareholder Equity, Income and Expense. Whenever we have to journalize a business transaction we debit one account and pass the corresponding credit to the other account. A sample entry for an Asset Purchase will be as follows:

                                       Dr Furniture (Assest) A/c                 XXX $
                                       Cr XYZ Company A/c (Liability)        XXX$
Different Ledgers are maintained for all the departments, cost centers and companies where we need different Final Reports and accounting for each of these business units are maintained in these separate ledgers.
Consolidation is done at the end of the period by - sorting the balances on the Account and adding the balances for each account to derive the consolidated balances of the Head Office or Company at the Account Level.
If required, revaluation and conversions are done to equate balances to the reporting currency.