Difference between Primary Ledger and Secondary Ledger
- If there is any change in the 4C’s then we will use the Secondary Ledger
Secondary Ledger
Basically, Secondary Ledger is used for consolidation and reporting purpose.
What is Revaluation?
Revaluation is nothing but the difference between the market value and book value. We usually run the revaluation program during the month end to know the exact difference in Exchange Rate Currencies which will eventually get from unrealized gain or unrealized loss.
Revaluation can be done if there are two different currencies
In case of loss: – Liability A/C Dr
Realized loss A/C Dr
To Cash clearing A/C
In case of Gain: – Liability A/C Dr
To Realized Gain A/C
To Cash clearing A/C
Translation:
Translation is used to convert the accounting balances from Functional Currency to Foreign Currency at Balance Level
We have three types of rates which are used for configuration
- Period Avg Rate
- Period End Rate
- Historical Rate
Basically, this is used for reporting purpose and consolidation.
CVR rule and SR rule
Cross Validation Rules – This is used to restrict the end users to enter the transactions into the application
CVR Rules works at Chart of Account Level
SR Rule:
Security Rule works at Responsibility or Role level.
Ex: Manager can enter the transactions whereas end user is restricted to enter the transactions
Explain P2P Cycle
P2P Cycle Starts with Requisitions. We have two types of Requisitions à Internal Requisition and External Requisition
- Internal Requisition means within the organization
- External Requisition means we will be sending the requirement to Suppliers and suppliers will send the quotations to the organization
- Based on the quotations, we will do the quote analysis and finalize the order
- Organization will send the Purchase order to supplier
Once the Supplier send the stock to Inventory, then we get the below mentioned accounting entry.
Receiving Inventory A/c
To AP Accrual A/c
Once we received the Invoice then we will get
AP Accrual A/c
To Liability A/c
At the time of Payment
Liability A/c
To Cash Clearing A/c
At the time of Reconciliation
Cash Clearing A/c
To Cash A/c
Accounts Payable Mandatory Setups and Configurations
Entire Payables driven by 3 options
- Common Options for Payable and Procurement
- Invoice Options
- Payment Options
Other Setups also
| 1. Create Business Unit Locations |
| 2. Create Reference Data Sets |
| 3. Create Business Units |
| 4. Assign Business Unit Functions to Business Unit |
| 5. Create Legislative Data Group |
| 6. Assign Legislative Data Group to LE |
| 7. Create Employee User |
| 8. Assign Implementation Consultant Roles to User |
| 9. Create Procurement Agents |
| 10. Common Options for Payables and Procurement |
| 11. Invoice Options Configuration |
| 12. Payment Options Configuration |
| 13. Create Payment Terms |
| 14. Create Distribution Sets |
| 15. Setting up Suppliers Number |
| 16. Assign Supplier Roles to User |
| 17. Create Supplier |
| 18. Create Supplier Addresses |
| 19. Create Supplier Sites |