Financial Management for abas ERP
“What if” Financial Scenarios Module
Corridor controlling, integrated in abas ERP, is an analysis and management tool for planning financial figures. It is implemented in the profit and loss statement (P&L), the balance sheet and cost accounting. With corridor controlling you can plan revenues, profits and cost objects. It supports consistent, results-oriented business management and delivers key figures for business planning and control of the fiscal year.
Recording finances in corridor controlling
Since accounting as a whole is fully integrated into abas ERP, all of the actual data from the P&L account and the balance sheet is available in the client. Budgets and planned data are generated using the actual data. Revenue from cost objects, production cost posting in the cost center, or both in a single profit center can be planned in corridor controlling for fixed and variable costs. When corridor controlling has been set up in the client, highly informative charts are available to support result-oriented company controlling. Using a planned scenario that is graphically mapped in three corridors, the development of actual figures can be tracked at any time. The charts supplied by corridor controlling enable the quick creation of a risk report.
The four curves of corridors
The three corridors result from using the following four curves: best case for optimistic planning, possible case for realistic planning, break even and worst case for crisis scenarios. The current values form the actual curve in one of the corridors. If your business results range in the corridor between possible case and best case, your fiscal year is developing well. If these results range between break even and worst case, you can take necessary actions.
The chart curves can also offer additional functions. A detailed drill-down function, for example, allows you to access the underlying budget data in other detailed evaluations or charts. Corridor controlling collects data and consolidates it in account forms, cost type forms, and cost element ranges that are created, in part, automatically.
abas gives you the flexibility to select the actual figures used to the bases and determine the planned figures and influencing factors. Scenarios can be quickly and easily generated, and info systems provide graphical and tabular evaluations.
Cost Accounting Module
Entrepreneurial thinking is important in any workplace. With comprehensive cost accounting, your team can quantify the cost efficiency of products and activities, improve decision-making and drive the success of your company. abas ERP not only monitors the cost of your goods and services, it also provides you with tools which you can use to compare costs under different conditions. Controllers can quickly analyze the benefits of an activity or process and recommend the most appropriate course of action to management.
Cost accounting includes an automatic offsetting function, Internal Account Activity Allocation (IAAA), for mapping internal exchanges of services within the company. In addition to IAAA, the exact overheads can be posted against the cost object on a monthly basis. This allows for a more accurate income statement than possible under conventional order costing. The cost and service calculation in abas ERP supports flexible planned cost accounting as part of internal accounting. It allows planned costs to be adjusted in all actual conditions that have changed for planning. Unacceptable differences from the target/actual comparison can be corrected. Data from various areas such as financial accounting and fixed asset accounting are integrated with cost accounting. Cost accounting in abas ERP also integrates data from the material valuation and valuation of production activity.
Cost accounting structure
Cost accounting in the ERP system is structured so that sub areas, cost type accounting, cost center accounting and cost object accounting, can be used alone or in combination. It is structured according to the principle of an integrated accounting system (the data is entered and processed in a closed allocation group). In the case of actual data, cost accounting accesses the financial accounting data. In an additional statistical journal, only cost accounting postings can be posted. With cost accounting, you can flexibly map a wide range of different solutions from simple cost accounting through to flexible planned cost accounting.
Actual cost type accounting and actual cost center accounting limited to the primary costs (cost accounting for beginners)
- Actual cost center accounting with internal account activity allocation
- Actual/planned cost center accounting with planned/actual comparison and internal account activity allocation cost center accounting according to flexible standard costing with target/actual comparison
Cost accounting values
Cost accounting generally uses actual and planned values. However, it can also be operated as actual/planned accounting or purely actual.
Integration in financial accounting
The actual values of cost accounting are taken from financial accounting. The imputed actual values, which are created in cost accounting by statistical entries, are an exception. Financial accounting and cost accounting are linked via the cost types.
Cost type accounting
Cost type accounting groups presents costs according to cost types. In order to use costs that are posted in financial accounting and in cost accounting, the cost types are allocated to P&L accounts. When posting to accounts in financial accounting, abas ERP automatically forms values on the cost types.
Options for internal account activity allocation:
- Preview or entry mode
- Actual, planned or actual/planned data types
- Monthly or annual entry period
After IAAA has been performed, different cost rates are available to the cost centers. The primary cost centers will then have the current overhead surcharge rates.
IAAA calculates the following values for each cost center:
- Full, marginal and fixed cost rate
- Fixed cost variance rate
- Usage variance rate
- Utilization variance rate
- Primary costs
- Total costs
- Overhead surcharge rate for primary cost centers
Cost object accounting (contribution margin calculation)
A contribution margin calculation can be mapped for each cost object in the expense distribution sheet (EDS). For example, the revenue of a cost object can be compared to the direct material and production costs, resulting in contribution margin 1. These direct costs are automatically posted using material costs posting and production costs posting. Contribution margin 2 is calculated by mapping the material overhead surcharge rate from the material primary cost center and the production overhead rate from the production primary cost center in the EDS. Then it subtracts these from contribution margin 1. This allows a contribution margin calculation to be mapped in the EDS at the cost object level with the overhead surcharge rates from cost center accounting.
Multi-dimensional contribution margin calculation
abas ERP supports a differentiated contribution margin calculation according to different dimensions. A multi-dimensional analysis, as a tool for decision-based cost accounting, is necessary in order to add to one-dimensional profit and loss statements. This leads to identifying the sources of losses.
Production cost posting
The production costs posting function enables the valuation of personnel and machine times from the completion confirmations. It then uses these to determine the production costs differentiated according to individual cost objects. Wage groups are available for the valuation of personnel times and machine times are valuated using hourly rates. The following can be edited as long as the completion confirmations have not yet posted: Fixed and variable machine hourly rates, personnel hourly rates, overhead rates and special costs. The production costs resulting from the valuation will be posted by means of statistical entries. abas ERP automatically performs both the valuation and posting of the production activity.
Cost accounting provides many evaluations which are used, for example, to present master data. They can also show the connections between the P&L accounts from financial accounting and the cost types of cost accounting or the cost types of the consolidation structures for cost centers and cost objects.
Evaluations for data analysis:
- The expense distribution sheet (EDS) displays the amount of the costs of specific cost types that are incurred in cost centers and cost objects. It is possible to make a comparison with the previous year. Furthermore, different transaction figure types (actual costs, fixed planned costs, proportional planned costs, target costs, absolute and relative target/actual variance) can also be displayed
- In addition to the EDS, there are also info systems (such as a cost center/cost object sheet) available for the evaluation of individual or multiple cost centers and cost objects
- The overheads report info system is used for the clearing of primary cost centers and cost objects. This will show, for example, the posted overheads and underlying direct costs
- The account report info system can be used to list and group all accounts in which entries are made from a certain cost type in connection with a certain cost element in a period
- A secondary cost report displays the specific exchanges of services between the cost centers within a specific time period.
Financials and Accounting
abas Financial Accounting maps the requirements of small, midsize, large and multinational companies. It is regularly certified in accordance with the Generally Accepted Accounting Principles (GAAP). abas Financial Accounting provides complete visibility into the data and value flow of your company. Parallel accounting is possible in accordance with the German Commercial Code, IFRS, etc. A broad range of flexible, individual financial reports are available. abas Financial Accounting also supports swift comparisons of target/actual figures for any given time period. All of the key information about unpaid invoices allows for the management of outstanding items, including payment transactions, direct debits and reminders. Integrated Cash Management supports short-term liquidity planning. This sets abas apart from many other ERP systems, which integrate with financial accounting systems from third-party providers.
Fully integrated financial accounting
Financial Accounting (FinAcc) is fully integrated into abas ERP. All transactions are fully recorded in a structured manner. Financial Accounting is based on master data and data from purchasing, sales, warehouse management, etc. As a fixed component of abas, financial accounting is not supplied with data via a linked interface, but receives this data directly through the processing of individual business transactions. The generation and posting of an outgoing invoice in sales are simultaneously connected to the posting of data in financial accounting. The advantage of this integration is that you can drill down to the original document from financial accounting at any time. Financial accounting provides a clear overview of all financial transactions. For example, data from several fiscal years is accessible. The use of offset or shortened fiscal periods is also supported. Monthly comparisons can be generated by managing transaction figures using legacy data. It is also possible to do planned/actual comparisons of values covering the course of several years. Furthermore, plausibility and completeness checks can be created for P&L and balance sheet accounts. Bank account statements can be posted automatically.
Chart of accounts included:
Set up a chart of accounts in abas ERP that meets your company’s requirements. When installing your ERP for the first time, your financial accounting will include a standard chart of accounts, which is closely related to DATEV SKR 04. This is especially important for partnerships and incorporated companies. All evaluations are coordinated with the chart of accounts. If you decide to use the standard chart of accounts, you can start immediately upon opening financial accounting. Individual modifications and expansions are also possible for the chart of accounts. The accounts are structured based on their summarization. A flexible grouping of the accounts is also possible, based on the given account ranges. The standard account assignment and the default setting of the account properties will automatically generate suggestions for the use of accounts, such as when automatically generating financial entries from purchasing and sales.
Taxes under control
Any number of tax codes and tax periods can be defined in abas ERP. An individual tax rate can be assigned to each tax code for each tax period. You can define tax periods for each month. This means that all legally specified tax conversions can be made. A tax deduction can be made for any percentage rate. The tax codes are allocated to tax and cash discount accounts. Correct backdated tax calculations are guaranteed at all times.
One multi tax code for several tax rates
The multi tax code allows tax to be calculated on an assessment basis multiple times. Several already existing tax codes with different percentages can be combined into one multi tax code. The multi tax code will then be calculated and ready for an invoice item in one step.
Advance sales tax return
Sales tax items can be defined as required, and accounts are flexible with how they can be allocated. Since the accounts and the sales tax item are both used in financial accounting, the monthly advance sales tax return figures will always be up to date. Advance sales tax returns can be created individually in accordance with statutory requirements. Country-specific adjustments are also possible. A verification can be carried out by using clear account and entry reports. In addition to the electronic sales tax advance return via Elster, abas ERP also supports print output. As an abas user, you will receive update programs and up-to-date PDF forms every year.
Tax issues can be clearly displayed
Tax issues in purchasing and sales processes, as well as financial entries, are clearly displayed in abas ERP. All data necessary for taxation is displayed in invoices, entries and outstanding items. All data for the financial entries are displayed in invoices, including the entry preview for invoices. This means that you have access all available data, such as accounts, tax codes, tax entry types and sales tax items in a single overview, and can make any necessary edits.
Multiple sets of books
In order to map out the reporting for one ERP client according to different accounting rules, up to five sets of books can be defined. These can be posted and evaluated independently of each other. Postings that apply to multiple sets of books only need to be entered once.
Automatic financial entries
Due to the integration with abas ERP, most financial entries are generated automatically, such as purchasing and sales, payment, fixed asset and material entries. The manual creation of entries is supported by the automatic default setting of data, copy functions and cancel functions. The monthly values of the accounts are automatically updated when posted, and are then available for evaluations. Since the balances carried forward will be updated automatically for upcoming years, no additional actions under the annual balances carried forward portion are necessary.
Recurring entries are financial entries that repeat in defined intervals. You can choose whether the entry process is carried out monthly, quarterly or annually based on different templates and rules. It is possible to change the contents and move the entry date or due date from entry to entry.
abas ERP supports the management of cash books in domestic and foreign currency. The cash documents for a month can be entered in any time intervals and can be posted automatically. abas ERP also provides consecutive document numbering and automatic cash balance updates. Users can print individual documents and all monthly receipts and expenditures. Purchasing and sales cash invoices are connected. When clearing outstanding items, the cash book is updated. Outstanding items can also be allocated directly in the cash book.
Outstanding items accounting is also integrated in financial accounting. It is available for accounts payable, accounts receivable, employees and general ledger accounts. Outstanding items can be managed in foreign currencies, down payments, guarantees of payment, other accounts receivable and accounts payable. Outstanding items are evaluated according to various selection and sorting criteria.
When posting invoices and generating manual entries, the system automatically generates outstanding items for customers, vendors, employees and the OI-relevant G/L accounts. Both the standard default setting as well as the differing process-related default setting of data, such as payment due dates, bank details and purpose of use, are taken into account. When recording the invoice, one or several partial payments can be scheduled.
In accounts receivable/accounts payable cash management, you can select between different methods of payment such as bank transfer, direct debit, check or bill of exchange. Various selection options help you to find the relevant outstanding items.
abas ERP displays all processes created for an outstanding item, such as payments, reminders or revaluations. Creating a new process permits a reference to existing outstanding items. When invoices or credit notes are created, the user can refer to a customer’s outstanding items and settle them immediately. If a payment is cancelled, the system opens the original outstanding item.
Revaluate outstanding items
Outstanding items in a foreign currency can be revaluated. Individual outstanding items can be excluded from the revaluation. The following takes place when reevaluating outstanding items in foreign currency:
The outstanding item will be updated, i.e. the exchange rate is preset to the revaluation exchange rate and the amount is recalculated in the domestic currency.
- A financial entry is created with an exchange rate difference account and an exchange rate difference amount
- The posted revaluation can be viewed in the revaluation history and in the complete history of an outstanding item.
Clearing outstanding items
In abas, whether an entry should be made to settle the outstanding items is decided on a case-by-case basis. Settled outstanding items can be documented and viewed in the outstanding items history. You can settle and close any number of OIs of the same account without using financial accounting. This is also possible with a financial entry, if preferred.
Outgoing payments/incoming payments
Outstanding items can be prepared for an outgoing or incoming payment in one or several steps. The selection can be made using selection criteria. The system suggests fixed value dates, payment due dates, and cash discount amounts on the basis of the terms of payment. You can either adopt this data or replace it based on your own decisions. Different methods of payment, such as bank transfer, direct debit, check, bill of exchange or other, are supported for outgoing and incoming payments. The create payment file info system generates export files for outgoing cash management, which can be imported and processed in the respective banking software, such as SFirm for instance.
abas ERP supports SEPA payment transfers, SEPA basic direct debits, SEPA urgent direct debits and SEPA company direct debits. abas ERP provides a simple system, that can be automated if required, to enter the SEPA mandate and to administrate and archive these direct debit mandates. There is also the option of informing the payer in advance of the direct debit using a pre-notification. SEPA defines that the due dates of individual direct debits are determined by calculating their minimum execution dates. The new XML data formats are now permanently available for the processing and are based on the German standards and ISO standard 20022.
If required, abas ERP creates payment suggestion lists for outgoing and incoming payments. There are various selection options available to the user for determining the affected accounts payable or accounts receivable and outstanding items.
The payment suggestion list:
- Offers simple and clear display of the invoices to be paid
- Is displayed and archived in the database
- Takes the date of the next planned payment into consideration
- Provides flexible selection: vendors, customers, employees, and outstanding items
- Only allows cash discount payments or net payments
- Allocation to several banks
- Selection criteria can be adopted from the template.
In reminders, there are multiple levels with individually configurable texts. The reminder texts can be created and printed in multiple languages. You can determine when the individual reminders are due and can include fees, interest on arrears or minimum payment amounts. The reminders can be locked for specific customers or outstanding items. The reminders suggestion list provides information about all outstanding payments. Reminders and the suggestions list are output in the dialog. The archiving of reminders and their processes are done automatically after the last level and date have been updated in the affected outstanding items. The status of the reminder provides information about its current processing status.
Principles for data access and the verifiability of digital documents
Accounting in abas ERP exports tax-relevant data in electronic format to the tax office according to the principles for data access, and the verifiability of digital documents. In the standard release you will find an expandable data model for the data output according to the XML description standard, which is recommended by the German Federal Ministry. The tax audits can be carried out in abas ERP using the AIS TaxAudit software.
Financial accounting in abas erp has interfaces to:
- DATEV financial accounting
Fixed Assets Module
Maintaining a precise overview of the lifecycles of each asset in your company, from the time of procurement over the depreciation period through to divestiture, poses a particular challenge. Due to the complexity of the applicable tax rules and accounting rules, even the smallest error can have significant consequences. Fixed asset accounting is fully integrated within abas ERP, meaning that all asset acquisitions and depreciations are fully traceable. The full documentation of assets ensures compliance with the relevant rules.
abas ERP fixed asset accounting flexibly manages the company’s fixed assets on an inventory basis. All evaluations required for year-end closing, such as the asset history sheet, are included. Aside from taxable depreciation, imputed depreciation can also be performed in abas fixed asset accounting. Using the connection to financial accounting and cost accounting you can post fixed assets directly through financial entries.
The imputed depreciation flows into the cost accounting through statistical entries. Much of the relevant data and figures, which can always be used to create a quantitative and qualitative overview of the fixed assets, can be easily and quickly generated within the system.
A clear overview of your fixed assets
Easily define and create assets to prepare them for evaluation. Besides the general properties, fixed assets displays and manages procurement data, depreciation data, retirement data and transaction figures.
Group fixed assets hierarchy
Fixed assets hierarchy can be grouped using fixed asset categories. Specific evaluations (fixed asset movement schedule and depreciation movement schedule) can be output as consolidated values based on fixed asset groups (consolidated fixed asset categories). When creating new fixed assets, some fields of the fixed asset categories will also be adopted as suggested values in the respective depreciation model.
Different depreciation model for each set of books
To facilitate the creation of evaluations according to different accounting rules, such as the German Commercial Code or IAS/IFRS, you can define up to five sets of books in abas ERP. In each of these sets of books you can define a tax and imputed depreciation model for each fixed asset. Different financial reporting specifications, such as depreciation method, useful life, or depreciation start can be defined for each of these different depreciation models. In order to continue to guarantee reporting of the fixed assets according to legal requirements, you can also adopt or enter different acquisition and production costs for each of the depreciation models in the set of books.
Definition of depreciation methods
You can define depreciation methods for an asset easily and flexibly in abas ERP. The process of a method of depreciation can be selected according to the legally required methods of depreciation (straight-line depreciation, declining-balance depreciation and immediate depreciation) as well as various commonly used methods.
The following calculation methods are available:
- Immediate depreciation
- Net book value through remaining life
- Depreciation rate of the acquisition value
- Acquisition value through useful life of the fixed asset
- Acquisition value through remaining useful life of the fixed asset
- Net book value through useful life of the fixed asset
Additionally, you can use the depreciation calculation to define any number of depreciation schedules for each fixed asset. This applies to the taxable and imputed depreciation model.
Automatic depreciation suggestions
Depreciation suggestions for the fixed assets are created automatically. Depreciations can be carried out via fixed assets, asset groups, balance sheet accounts or cost centers. They are calculated and posted for all fixed assets of a set of books. They can also be completely cancelled.
Easy calculation of depreciation
You can perform depreciations for any period. The depreciation calculations can easily run by creating depreciation suggestions and by automatically correcting depreciation that is too high or low. You can use planned and unplanned depreciation amounts if an amount varies from the calculated depreciation amount that is entered. The depreciation calculation is integrated in the transaction figures. The current depreciation run and amount can be viewed at any time.
Depreciation to the day
It is possible to use the monthly or the to-the-day depreciation procedure (accepted in Spain and Hungary) in a client. If the to-the-day depreciation procedure is used, all processes (acquisitions, retirements, transfers) of a fixed asset will be taken into consideration up to the entry date.
Imputed fixed assets
In abas ERP, you can work with imputed depreciation in addition to tax depreciation (for example, when calculating a cost object). While using the imputed depreciation model and planned depreciation amounts, you can continuously post statistical values in cost accounting even if the net book value of a fixed asset would become negative. For each fixed asset and for all five sets of books, a tax and an imputed model can be created and managed separately from one another. If the tax depreciation model mainly mirrors the imputed model, it can be used as a template for automatic creation of the imputed depreciation model. Also, depreciation amounts from a tax-based depreciation model can be allocated to cost object and cost centers.
Calculation of replacement values
The calculation of dynamic values, such as replacement values, can be executed in tax or imputed depreciation models with index series. You can record the trend of relative and absolute value changes in relation to a specified base year in the index series of a fixed asset. Based on the acquisition and production costs, the calculated value can also be used as the foundation for the depreciation calculation. This is required in taxable depreciation models if the depreciation is carried out to the fair value. A good example is the replacement value as it is done in U.S. GAAP. This is an advantage in imputed fixed asset accounting if the acquisition costs and costs of goods manufactured are not identical to the legally predetermined valuation of the fixed asset.
Calculation of imputed interest
If the calculated replacement values are not used for the imputed depreciation, any number of value changes such as inflation or internal interest rates, they can be recorded in the index series. This signifies that changes in the annual replacement values of a fixed asset and imputed interest rates can be displayed.
Automatic fixed asset retirements and transfers
Using the automatic fixed asset transaction, you can carry out fixed asset retirements and transfers supported by the system. You can choose from complete retirement, partial retirement, full transfer, partial transfer or balance sheet account exchange. The relevant entry information can be recorded for all of these transaction types and the corresponding entries can then be generated from the screen.
Asset accounting lists and evaluations
- Asset history sheet: The asset history sheet shows the development of acquisition costs, costs of goods manufactured, the book values, and the depreciation throughout a fiscal year. It can also be created and output on a monthly basis, i.e. with current monthly transaction figures
- Fixed asset history: The fixed asset history displays the individual entries that have been posted to the fixed asset within the specified period
- Depreciation movement schedule: Using the depreciation movement schedule it is possible to output the development of depreciations for a previously selected time period in a previously selected output currency
- Depreciation planning: Projection of the scheduled depreciations for the next seven fiscal years
- List of retirements
- List of acquisitions
- Development of fixed assets
- Asset history sheet (imputed)
- Fixed asset history (imputed)
- Depreciation movement schedule (imputed)
It is also possible to evaluate the fixed assets of each individual set of books so that the asset history sheet, the development of the fixed assets, or the projected depreciations for each accounting regulation can be created.
Liquidity Planning Module
Liquidity planning supports the preemptive planning of payments, which will help to secure both your liquidity and solvency. Starting from the current liquidity level, outstanding items from purchasing and sales and all delivery and invoice commitments are added or deducted and spread over the selectable time scale.
Liquidity planning and purchasing
You can choose to take into account purchase order and subcontracting suggestions from purchasing. The payable sales tax from outstanding items and commitments is also calculated. If you have entered lines of credit or loans, the interest due on these for use or overdrafts will be calculated.
The manual entry of one-off or recurring payment events, such as planned investments, is also supported, as this enables all of the cash inflows and outflows relevant to liquidity to be taken into account. The configurable due date scenarios, such as best case or worst case, allow several possible scenarios to be compared to one another. You can choose to take into account real customer payment behavior in these scenarios rather than the agreed payment terms.
Perpetual Inventory Costing Module
Perpetual inventory costing in abas offers real-time inventory tracking by continually updating your inventory as relevant activities occur. For example, each time you receive an item from purchasing or produce a finished good, it’s immediately accounted for in the system. This automated process reduces how often you need to manually count your inventory.
Updating your stock in real time
Perpetual inventory counting increases your visibility into what you currently have in stock, so abas can immediately help plan when stock replenishment is required or whether or not the product is in stock to sell. The system reacts immediately to actual inventory levels by creating purchase orders, work order suggestions or automatically initiating other actions.
For example, if you receive a large sales order that will deplete inventory and requires you to replenish your stock to avoid back orders, abas, using perpetual inventory costing, will recognize that in real time and the purchasing department will have insight that the item needs to be replenished.
Inventory valuation report
abas’ inventory valuation report allows you to check the stock level and value on any given key date, and is accurate across all locations. If you do a stock adjustment during the day, it is immediately updated everywhere in the system.