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Objects - in Standard ERP

You can use Objects in Standard ERP to classify your transactions in various ways. In this section, we will illustrate the use of Objects using as an example the requirement to analyse sales by geographical area, type of business, salesperson and type of Item. If your business has several offices or branches, you could also use Objects to analyse the sales performance of each office or branch. In fact, you can assign up to 30 Objects to each transaction (with 20 being a more practical limit), providing you with very extensive reporting possibilities. To set up such a system, follow these steps:
  1. The first step is to define Object Types, using the setting in the Nominal Ledger. In the example, we will need four Object Types for geographical area, type of business, type of Item and sales person:

  2. The next step is to define the Objects themselves, using the Object register that is available in both the Nominal Ledger and System module. Each Object should belong to an Object Type:

  3. When you enter a record to the Person register in the System module for each member of staff, you can assign one Object on the 'Accounts' card:

    In this example, we will illustrate using these staff Objects to analyse sales made by each salesperson. The relevant Object will automatically be used in all sales made by each Person.

    Staff Objects are also used in the Expenses module. If you will be using this module, it is recommended that you use a different Expenses Control Account for advances and settlements (Account 826 in the illustration above) for each Person. If this is not possible, you should at least use a separate Object for each Person. If you do not have a unique Account/Object combination for each Person, the Periodic Personnel Statement report will not be correct because it will not be able to calculate separate balances for each Person.

  4. When you enter a Customer record to the Contact register, you can assign Objects to it. These Objects will automatically be used in all sales transactions involving the Customer. You can assign several Objects to a Customer, separating each Object using commas. The Object field can contain up to 60 characters. As mentioned above, this means you can assign up to 30 Objects to a Customer, taking the commas into account. However, it is recommended that you use Object Codes with at least two characters, so the more usual limit is 20 Objects.

    For each Customer, enter one Object belonging to the "AREA" and "BUS" Types in the Sales Objects field on the 'Accounts' card, separated by a comma:

    Do not enter more than one Object belonging to the same Type, because you cannot use more than one Object belonging to the same Type in a sales transaction. There is no need to enter an Object representing the sales person, because this will be supplied to each sales transaction from the Person register.

    The Object field is in some ways similar to the Classification field on the 'Contact' card. Both fields can contain several entries separated by commas, and sometimes the information will be the same in both fields. The Classification field will provide analysis for CRM purposes (marketing, mailshots, etc.), while the Object field will provide accounts analysis in the Nominal Ledger. In this example, the geographical area and type of business of the Customer is useful information for both purposes, so it should be entered both in the Classification field and in the Sales Objects field.

    The Purch. Objects field operates in the same way as the Sales Objects field, but is used for Suppliers (i.e. in purchase transactions).

  5. When you enter each Item to the Item register, you can similarly assign Objects to it, using the Objects field on the 'Pricing' card. In this example, enter an Object belonging to the "ITEM" Type. As shown in the illustration, you should typically use Objects representing the general type of Item, not the exact model (i.e. an Object for Audio Equipment is to be preferred to an Object for the Digital Radio):

  6. As already mentioned, the Objects assigned to each Customer, Person and Item will automatically be transferred to all sales transactions. However, there may be Customers or Items that do not have Objects, perhaps because there was insufficient information to be able to assign the correct Objects when the record was first created (e.g. it was not possible to assign an Object belonging to the "BUS" Type because the nature of the Customer's business was not known). As a result, sales transactions using these Customers or Items will not contain the complete set of Objects, so the subsequent Object analysis will be incomplete if not inaccurate.

    To guard against this, use the Object Type Control setting in the Nominal Ledger to ensure that every sales transaction contains Objects belonging to the correct Types:

    In the example illustrated above, we have specified that whenever we use an Account between 100 and 199 (i.e. any of our Sales Accounts) or one between 200 and 299 (i.e. any of our Cost of Sales Accounts), it must be together with Objects belong to each of the "AREA", "BUS", "PERS" and "ITEM" Object Types. We will not be able to save the transaction if an Object belonging to at least one of these Types is missing. Accounts 100 and 199 are separated by a colon, signifying a range i.e. all Accounts between 100 and 199. Use a comma to separate the two ranges 100:199 and 200:299: this has been done in the example to illustrate separating two ranges of Accounts, although in this case as shown on the last line we could also use one large range to the same effect.

  7. Whenever you use the Customer in a Sales Invoice or in any record that will eventually lead to an Invoice (i.e. Quotation, Order, Project, Service Order), the Customer's Objects and that of the Salesman will be brought in automatically. In the case of the Order, they will be visible in the Objects field on the 'Terms' card. When you add Items to the Order, their Objects will be brought in to flip B of the 'Items' card:

  8. If you need to raise a Purchase Order for the Items on the Sales Order, the Objects from the Items are again brought in to flip B of the Purchase Order. As mentioned in step 4, you can specify separate Purch. Objects in each Contact record for use in purchase transactions. In this example, a Purch. Object ("SUPP") has been specified for the Supplier and this will be brought in automatically to the Objects field on the 'Terms' card:

    From the Purchase Order, these Objects will be transferred to the Goods Receipt:

    In the resulting Nominal Ledger Transaction, the Objects representing the Items will be assigned both to the credit postings to the Purchase Accruals Account and to the debit postings to the Stock Account. The Object representing the Supplier will be assigned to the credit postings to the Purchase Accruals Account.

    There are various options that you can use to control the postings to which Objects will be assigned. In this example, the Supplier Object has not been assigned to the debit postings to the Stock Account because we are not using the Supplier Object on Stock A/C option in the Account Usage P/L setting.

    When you create the Purchase Invoice from the Purchase Order, the Objects will again be included:

    These Objects will be transferred to the debit postings to the Purchase Accruals Account(s):

    In this example, the Supplier Object has not been assigned to the posting to the Creditor Account because the Objects on Creditors A/C option in the Account Usage P/L setting is not being used, and it has not been assigned to the posting to the Input VAT Account because we are also not using the Objects on VAT Account option (again in the Account Usage P/L setting).

  9. On the sales side, the Customer, Person and Item Objects will all be transferred from the Order to the Delivery and to the resulting Invoice:

    At any stage in the process, you can change the Objects (subject to Object Type Control if you are using that setting as described in step 6 above) or add extra ones if you need to. If a record already contains an Object and you decide to choose a new Object using the 'Paste Special' feature, type the comma or colon before opening the 'Paste Special' list. This will cause the next Object to be added to the one(s) already there. Otherwise, the previous Object will be overwritten.

    Usually, the 'Paste Special' list of Objects is the standard one:

    You can find the Object that you need by sorting the list by Object, Type or Name.

    However, if you are using the Object Type Control feature, the standard 'Paste Special' list when opened from the Invoice will be replaced by the 'Assisted Object Entry' window:

    In the example illustrated above, we opened the 'Assisted Object Entry' window from the Object field on flip B of the 'Items' card. The window therefore prompts us to enter Objects belonging to the "AREA", "BUS", "PERS" and "ITEM" Object Types, since we have to use Objects belonging to these Object Types together with all Sales Accounts. Using 'Paste Special' in the usual way, enter an Object belonging to each Type in the appropriate field. 'Paste Special' here will only list the Objects belonging to the Type in question. Use the Extras field if you want to add another Object belonging to a fifth Type.

  10. When we mark the Invoice as OK and save, the "MID" and "RET" Objects from the Customer, the "FF" Object from the Person and the appropriate Object from the Item will be attached to the postings to the Sales and the Cost of Sales Accounts. These Objects will be arranged in alphabetical order automatically:

    As on the purchase side, there are various options that you can use to control the postings to which Objects will be assigned. In this illustration, as we are using the Object on Stock Account option in the Cost Accounting setting, the Objects have also been attached to the posting to the Stock Account. We are not using the Objects on Debtors A/C option in the Account Usage S/L setting, so Objects have not been assigned to the posting to the Debtor Account. We are also not using the Objects on VAT Account option (again in the Account Usage S/L setting): if we were, the "MID" and "RET" Objects from the Customer and the "FF" Object from the Person would be assigned to the posting to the Output VAT Account.

  11. As shown in the previous steps, once you have allocated Objects to your Customers, Persons and Items, they will be transferred via every Invoice to the Nominal Ledger automatically. After entering some more transactions to make the example more complete, you can now produce Profit & Loss reports for each Object, or for any Object combination. For example, to see the profitability of sales to retail Customers, produce a report for the "RET" Object:

    This is the resulting report:

    You can also produce a Profit & Loss report for a particular Object Type, to compare the profitability of each Object belonging to that Object Type. For example, you could produce a report for the "PERS" Object Type, to compare the profitability of the sales made by each Person or, as shown in the illustration below, on the "BUS" Object Type, analysing the profitability of sales to Customers of each business type:

    If you need to see individual profit figures for each Object belonging to the "BUS" Object Type, produce an Object Results report for this Object Type:

    If you need to see individual profit and margin figures for each Object belonging to the "BUS" Object Type, produce an Object/Quantity Results report for this Object Type:

    You can also produce reports for a combination of Objects. For example, to report on sales by Person FF to retail Customers, produce a report for the "FF" and "RET" Objects, separated by a comma:

    Because you specified two Objects separated by a comma, the calculations in the report will only use those postings with both Objects:

    The Nominal Ledger report offers exceptionally powerful multi-level Object analysis. For example, you can use it to list the sales Person FF made to each member of the "BUS" Object Type, by entering Object "FF" in the Loop 2 field and Object Type "BUS" in the Loop 3 field (the Loop 2 and Loop 3 fields are on card 2 of the specification window). In this example, we are reporting on Accounts 199 (sales) and 240 (cost of sales):

    This is the resulting report (produced using the Show Object and Balances Only options for clarity):

    If we change the Loop 2 field to the "PERS" Object Type, the report will show the sales made by each Person (i.e. each member of the "PERS" Object Type) to each Business Type:

  12. If you need more detail, you can create a Key Financial Ratio report with the appropriate Key Ratios. For example, you can create a report that will show the sales made by each Person to each Business Type together with profitability figures. This is a sample report definition:

    Row 3 will print the total sales value for Person FF (i.e. the total of all postings with Object "FF" to the Sales Accounts between 100 and 199) while row 4 will print the cost of those sales and row 5 will subtract the costs from the sales, Please refer here for more details about configuring Key Financial Ratio reports.

    When you produce the report, specify the "BUS" Object Type. This will cause the report to contain separate sections for each Object belonging to that Object Type:

    This is the resulting report:

As shown above, the Object feature is a very powerful one, allowing you to produce profitability reports in the Nominal Ledger for any cost centre (e.g. departments, Customer and Item types, employees and geographical areas) on its own or in any combination.

If you have the Job Costing module, you can also assign a dedicated Object to each Project. This Object will be attached automatically to every transaction related to the Project (e.g. Items supplied, work done, expenses incurred), so Project profitability will be easy to ascertain. Any work carried out by an employee will contain that employee's Object in addition to the ones for the Project and the Customer, once again allowing very detailed analysis.

All Objects can span several years. This is a consequence of the continuous database used by Standard ERP, where the end of year is simply a user-defined reporting interval. The Object balances are thus automatically transferred from one fiscal year to the next. This gives you the ability to keep track of the budget and results of an Object (e.g. a building project) for several years.

You can close an Object, to prevent further postings to it. Working in the Object register (in the Nominal Ledger or the System module), tick the Closed check box to close it. If you want to open the Object again later, you simply click in the box again to remove the check.

You can use the hierarchical Objects feature to help make assigning Objects easier and faster and reduce the risk of making mistakes. Please click here for details.

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