Single Transaction Method
If you are using the Single Transaction method, your cash transactions will be recorded in the Nominal Ledger in Transactions created from Invoices and Purchase Invoices only. Cash In and Cash Out records created from these Invoices will not cause Nominal Ledger Transactions to be created. Records entered directly to the
Cash In and Cash Out registers with no related Invoice will generate
Nominal Ledger Transactions. This system might be suitable where invoicing and cash handling are carried out by a single person or in a single office.
To set up a Single Transaction system, follow these steps:
- In the Sub Systems setting in the Nominal Ledger, ensure the Invoice, Purchase Invoice, Cash In and Cash Out options are switched on.
- In the Cash Book module, switch on the Cash Collection option in the Cash Book Settings setting, and switch off the Payment Mode Control option.
- Again in the Cash Book module, enter at least two Payment Modes. In both, set the Type on flip B to "Cash". In the N/L column on flip C, set one Payment Mode to "GenTrans" and one to "Do Not GenTrans". If you have more than one Cash Account, enter a twin set of Payment Modes for each one. In this circumstance, it is recommended that you use a different Number Series for each "Do Not GenTrans" Payment Mode. This will help you make the most of the 'Create Collection Cash In' and 'Create Collection Cash Out' Maintenance functions.
- Enter one Payment Term record with a Cash Account and where the Type is "Cash". You can do this using the setting in the Sales or Purchase Ledgers. If you have more than one Cash Account, enter a separate Payment Term for each one.
- When entering a Cash Invoice or Purchase Invoice, enter the appropriate "Cash" Type Payment Term. When you approve and save the Invoice, it will be treated as paid. There will not be a posting to a Debtor or Creditor Account, but instead there will be one to the Cash Account from the Payment Term.
- Once you have approved the Invoice, you can create a Cash In or Cash Out record from it by selecting 'Create Cash In' or 'Create Cash Out' from the Operations menu. If you have several Invoices, you can create a single Cash In or Cash Out record from them using the 'Create Collection Cash In' or 'Create Collection Cash Out' Maintenance functions.
Enter the appropriate Payment and Corresponding Modes to these Cash In and Cash Out records. The Payment Mode should be "Do Not GenTrans". This will mean that when you approve these Cash In and Cash Out records, no Nominal Ledger Transactions will be generated. You must specify a Corresponding Mode, but the choice is academic because there will not be a Nominal Ledger Transaction.
- You should also follow the procedure described in steps 5 and 6 when you enter Receipts and Payments. Use a "Do Not GenTrans" "Cash" Type Payment Mode in each Receipt and Payment. This will be transferred to the resulting Cash In and Cash Out records, which will therefore not generate Nominal Ledger Transactions when you approve them.
- If you need to enter a cash transaction that has no stock implications, you can enter it directly to the Cash In or Cash Out registers. In this case, specify the "GenTrans" Payment Mode. When you approve the record, a Nominal Ledger Transaction will be generated.
- The Cash Book Settings setting allows you to specify the Payment and Corresponding Modes that you want to be used as defaults in new Cash In and Cash Out records. Take care with this feature if you are using the Single Transaction method. When creating Cash In and Cash Out records from Invoices (step 6) and Receipts (step 7), you should use a "Do Not GenTrans" Payment Mode, but when entering cash transactions with no stock implications (step 8), you should use a "GenTrans" Payment Mode. Specifying a default Payment Mode may therefore cause confusion, because there will be circumstances where the default is wrong. However, you must specify a default Payment Mode if you want to use the 'Create Collection Cash In' or 'Create Collection Cash Out' Maintenance functions. When creating Cash Out records from Payments (step 7), the Payment Mode in the Cash Out will be copied from the Payment and so the default will not apply.
