MP2 uses three different accounting objects that can be confusing: Account Codes, Cost Centers, and General Ledgers. I'm going to try to keep it brief (not one of my strengths) and quickly explain the purpose, implementation, and importance of each of these.
Account Codes
Account Codes are by far the most important on this list. They are used on all purchasing and inventory transactions. (You might be more familiar with the term "GL Debit Account".) In order that users not be required to enter these all the time, MP2 allows you to provide some defaults for each inventory item.
· Balance Account Code – the account that represents the current stock value. This account code is used for purchasing receipts and positive stock adjustments. It is also used for PO returns.
· Expense Account Code – the account used when issuing items out of the warehouse.
· Write-off Account Code – the account used for negative stock adjustments.
When creating transactions, if MP2 doesn’t find an Account Code by looking at the inventory item defaults, it then looks for the warehouse defaults. You can set these up in the Warehouses setup dialog (Tools > Security > Warehouses). If it doesn’t find anything there, then it just lets the user provide a value.
Account codes are managed through the Inventory application (Activities > Inventory > Accounts).
General Ledgers
General Ledgers are the least important item on this list. They are used only in the Budgeting module, which is very rarely implemented anyway (accounting is not MP2’s strength).
General Ledgers are not associated in any way with account codes.
General Ledgers are managed through Equipment module (Activities > Equipment > General Ledgers).
Cost Centers
Like General Ledgers, Cost Centers are not connected to Account Codes. The intent is to provide a bucket for inventory usage, usually at a less granular level than the account code (although not always – some facilities choose to use the same values for both the account codes and the cost centers).
Cost Centers are managed through Equipment module (Activities > Equipment > Cost Centers).
How about that ‘Account Code’ field on purchase orders? That field has nothing to do with accounting – it’s just there for you to reference a client account, if you want.
Can I add an account code to a WO so that MP2 will automatically use it for related transactions? Well… MP2 doesn’t have an Account Code field on the WO. But it’s not too difficult of a customization. Give me a call, and I’d be glad to discuss it.
What should I do if I want to retire an account code? It's often difficult to get rid of an account code if MP2 has open records that reference it. Often, the best thing to do is to rename it by prefixing it with "ZZ_". This will cause it to sort to the bottom of the lists, including lookups, so that users are unlikely to continue to use it. Then, when all POs are closed, you should be able to delete it. Any historical records will become "orphaned", which is OK in most cases.
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