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ERP

Project Development Structure

This section of the project readme explains the detailed structure of the ERP Project that is being developed. Enterprise Resource Planner (ERP) is a is software used by a company to manage key parts of operations, including accounting and resource management. In the preliminary stage of the software, the software will include two primary modules, Account & Inventory.

Account

The account module of the software helps in recording financial transactions occurring in a business. Various aspects and features needed to manage account of a business are explained in subsections below.

  • Double Entry Book Keeping System

    Double-entry bookkeeping, also known as double-entry accounting, is a method of bookkeeping that relies on a two-sided accounting entry to maintain financial information. Every entry to an account requires a corresponding and opposite entry to a different account. It is a method of recording transactions where for every business transaction, an entry is recorded in at least two accounts as a debit or credit. See More

  • Debit & Credit

    Debits and credits in double-entry bookkeeping are entries made in account ledgers to record changes in value resulting from business transactions. A debit entry in an account represents a transfer of value to that account, and a credit entry represents a transfer from the account. Each transaction transfers value from credited accounts to debited accounts.

    • Debit The Ledger if a ledger or entity has some amount left to be paid to your business after buying goods or service from your business.
    • Credit The Ledger if your business has some amount left to be paid to the ledger or entity after buying goods or service from them.
Kind of account Debit Credit
Asset Increase Decrease
Liability Decrease Increase
Income/Revenue Decrease Increase
Expense/Cost/Dividend Increase Decrease
Equity/Capital Decrease Increase
Note: Accounts with normal debit balances are in bold.

  • Ledger

    In general accounting, a ledger is a book or collection of accounts in which accounting transactions are recorded. In our system, ledger has been simplified as an entity, either that be a person, another business, or any account on which transaction are debited or credited. See More

  • Ledger Group

    In our system, ledgers are grouped on the basis of their properties. This grouping is called legder group. Each ledger group has many ledgers, a negative ledger for carrying forward if value is negative while preparing financial report and many children groups for further grouping.

  • Ledger Classification

    In our system, ledger groups are classified on the basis of their nature under ledger classification. There are only four ledger classification, i.e., assets, liabilities, income, expenses.

  • Tax Banking Address Contact Detail

    Since a ledger is an entity which can have variations of data, which can be required to one type of entity and not to another type of entity, during normalization, Tax Banking Address Contact Detail is created where the details are kept in JSON format since any of the ledger may require multiple of such data.

  • Voucher

    In general accounting, voucher is any documentary evidence supporting the entries recorded in the books of accounts, establishing the arithmetic accuracy of the transaction. In our system, vouchers are recorded transactions related to ledger or inventory items. Each voucher can have 2 or more entries any of which may relate to one ledger or item. Ledger entry may be primary or additional entry for an item. There are 3 types of ledger entries:
    • Ledger Entry (A) : For transaction between ledgers.
id voucher_id dc amount ledger_id narration inventory_transaction_type item quantity rate parent_id
default required required required required optional null null null null null
  • Inventory Entry (B) : For inward and outward entries of items in inventory.
id voucher_id dc amount ledger_id narration inventory_transaction_type item quantity rate parent_id
default required required required null optional required required required required null
  • Ledger Sub Entry for Inventory (C) : For additional costs ledger entries of items in inventory.
id voucher_id dc amount ledger_id narration inventory_transaction_type item quantity rate parent_id
default required required required required optional null null null null required

  • Voucher Types

    In general accounting, there are major 7 types of voucher types, but our system will have following types of primary vouchers and unlimited custom vouchers. The custom voucher shall be created by user by modifying the primary voucher type's settings.

    • General Voucher Types
      • Contra Voucher: Used to record transactions involving cash and bank accounts within the same entity.
      • Journal Voucher: Records non-cash transactions, typically adjusting entries or transfers between accounts.
      • Purchase Voucher: Records purchases made by a company, usually for goods or services.
      • Sales Voucher: Records sales transactions, documenting the revenue generated by selling goods or services.
      • Payment Voucher: Records payments made by the company to suppliers, employees, or for other expenses.
      • Receipt Voucher: Confirms the receipt of payment, detailing the amount received and its purpose.
      • Credit Note: Issued by a seller to a buyer, acknowledging a reduction in the amount payable due to returned goods or overpayment.
      • Debit Note: Similar to a credit note but issued by a buyer to a seller, acknowledging an increase in the amount payable, typically due to additional goods received or underpayment.
      • Rejection In: Records goods rejected by the buyer upon receipt.
      • Rejection Out: Records goods rejected by the seller before delivery.
    • Order Voucher Types
      • Purchase Order: A document issued by a buyer to a seller, indicating the types, quantities, and agreed prices for products or services the buyer wants to purchase.
      • Sales Order: Generated by a seller in response to a customer's purchase order, confirming the details of the sale.
    • Manufacturing Voucher Types
      • Manufacturing Voucher: Documents the production process, including the materials used, labor involved, and overhead costs.
    • Stock Verification Voucher
      • Physical Stock Voucher: Records the actual physical count of inventory items to verify their existence and accuracy in the system.
    • Note Voucher Types
      • Delivery Note Voucher: Issued by a seller to accompany the delivery of goods, detailing the items delivered.
      • Receipt Note Voucher: Acknowledges the receipt of goods by the buyer, confirming the items received and their condition.
    • Job Voucher Types
      • Work In Voucher: Records the transfer of materials or components into a production process or job.
      • Work Out Voucher: Documents the completion of a job or production process, including any finished goods produced.
    • Transfer Voucher Types
      • Material In Voucher: Records the receipt of materials into a particular location or department within the organization.
      • Material Out Voucher: Documents the transfer of materials from one location or department to another within the organization.
    • Other Voucher Types
      • Memorandum Voucher: Used for internal record-keeping purposes, typically to note adjustments or corrections that do not involve actual transactions.
      • Reversing Journal: A journal entry made to reverse a previous entry in the accounting records, often used at the beginning of a new accounting period.
      • Payroll Voucher: Records payments made to employees, including wages, salaries, bonuses, and deductions.
      • Attendance Voucher: Documents employee attendance, typically used for tracking purposes in payroll or HR systems.

    In the first stage of development, we will create the following voucher types, the voucher types that are excluded in this development process may be added in later period in accordance with the change in requirement of the system.

    • General Voucher Types: Recorded in Vouchers & Voucher Entries Table
    • Order Voucher Types: Recorded in Orders & Order Entries Table
    • Manufacturing Voucher Types: Recorded in Vouchers & Voucher Entries Table
    • Transfer Voucher Types: Recorded in Vouchers & Voucher Entries Table

  • Voucher Posting

    There are various voucher posting rules for accounting system:

    • Total Debit (Dr) = Total Credit (Cr)
    • Total Debit (Dr) = Total Credit (Cr) = Total Amount of Item (If inventory is affected).
    • Ledgers should be selectable on the basis of Ledger Type for every Voucher Type.
SN Voucher Types Ledger Entry Types Supported
A. GENERAL VOUCHERS
1. Contra Voucher A
2. Journal Voucher A
3. Purchase Voucher A,B,C
4. Sales Voucher A,B,C
5. Payment Voucher A
6. Receipt Voucher A
7. Credit Note A,B,C
8. Debit Note A,B,C
9. Rejection In A,B,C
10. Rejection Out A,B,C
B. ORDER VOUCHERS
1. Purchase Order N/A
2. Sales Order N/A
C. MANUFACTURING VOUCHER
1. Manufacturing Voucher A,B,C
D. STOCK VERIFICATION VOUCHER
1. Physical Stock Verification B
E. NOTE VOUCHERS
1. Delivery Note A,B,C
2. Receipt Note A,B,C
F. JOB VOUCHERS
1. Work In Voucher
2. Work Out Voucher
G. TRANSFER VOUCHERS
1. Material In B,C
2. Material Out B,C