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  • What are linked accounts?


 

 

There are two types of linked, or default, accounts used in AccountRight: feature-level and record-level linked accounts. They work behind the scenes so you don’t have to select as many accounts every time you record a transaction.

Feature-level linked accounts

Feature-level linked accounts are the default accounts that AccountRight uses for some of its main features. For example, there’s a linked account for tracking receivables (your trade debtors) and a banking account for receiving customer payments. So whenever you record a credit sale, AccountRight knows which account you use to track what customers owe you, and will update it automatically. Likewise, when you receive a customer payment, the linked bank account you’ve selected will be used by default.

You can see which accounts are linked to features by going to the Accounts List window. Linked accounts are indicated by a tick in the Linked column. You can also view or print the Linked Accounts report to see the full list of feature-based linked accounts (Reports menu > Accounts tab > Linked Accounts).

You can edit feature-level linked accounts by going to Setup menu > Linked Accounts. From this menu you can choose to set up:

Accounts and banking linked accounts

Go to Setup menu > Linked Accounts > Accounts & Banking Accounts

  • Equity Account for Current Earnings: This account helps you track your profit (or loss) for the current financial year. When you close the financial year, the balance of this account is transferred to the equity account for retained earnings. You can’t change this account. See also Distributing profit and loss.
  • Equity Account for Retained Earnings: This account helps you track the cumulative profit (or loss) of the business up to the start of the current financial year. When you close the financial year, the balance of the equity account for current earnings is transferred to this account. You can’t change this account. See also Distributing profit and loss.
  • Equity Account for Historical Balancing: This account is used to balance your accounts list and balance sheet report. As a rule, the value of your assets must equal the combined value of your liabilities and equity. If you haven’t entered all of your opening balances, or a value was entered incorrectly, a “balancing” amount will be allocated to the Historical Balancing account. Once you enter all your opening balances accurately, this account will return to zero. See also Entering account opening balances.
  • Bank Account for Electronic Payments: This is a clearing account that’s used to keep track of electronic payments that haven’t been processed yet. The payments are cleared from this account and withdrawn from your bank account when you process them using the Prepare Electronic Payments window. See also Entering detailed transactions.
  • Bank Account for Undeposited Funds: This is a clearing account that you used to keep track of receipts that haven’t been deposited directly to your bank account (such as cash and cheques). The receipts will be cleared from this account and deposited to your bank account when you process them using the Prepare Bank Deposit window. See also Entering detailed transactions.

Sales linked accounts

Go to Setup menu > Linked Accounts > Sales Accounts

  • Asset Account for Tracking Receivables: This account is used to track the total amount that customers currently owe you. The balance will increase automatically when you record an invoice, and decrease when a payment is made.
  • Bank Account for Customer Receipts: This is the default bank account into which customer payments are deposited. If you have more than one bank account for this purpose, select the one that will be used most. You can select a different bank account when recording the receipt.
  • Income Account for Freight: This is the account you want to use for freight you charge to customers on invoices. Amounts you enter into the Freight field on a sale will be allocated to this account.
  • Liability Account for Customer Deposits [Not Basics]: This account is used to track deposits you collect from customers when recording a sales order. If you enter an amount in the Paid Today field of a sales order, the amount will be allocated to this account.
  • Expense or Cost of Sales Account for Discounts: This account is used to track early-payment discounts you give to customers when they pay their invoice in full. Early payment discount conditions are set up in the credit terms of the sale, and can also be entered in the Receive Payments window.
  • Income Account for Late Charges: This account is used to track finance charges you collect from customers. The late payment finance charge conditions are set up in the credit terms of the sale, and can also be entered in the Receive Payments window.

Purchases linked accounts [Not Basics]

Go to Setup menu > Linked Accounts > Purchases Accounts

  • Liability Account for Tracking Payables: This account is used to track the total amount you currently owe to suppliers. The balance will increase automatically when you record a bill, and decrease when you make a payment.
  • Bank Account for Paying Bills: This is the default bank account from which bill payments are made to suppliers. If you have more than one bank account for this purpose, select the one that will be used the most. You can select a different bank account when recording the payment.
  • Liability Account for Item Receipt: This account tracks the stock you receive from a supplier without a bill on a Receive Items transaction. This account will be cleared when you record the bill for the stock received. See also Recording items received without a supplier bill.
  • Expense or Cost of Sales Account for Freight: This account is used to track freight amounts you pay to suppliers. Amounts you enter into the Freight field on a purchase will be allocated to this account.
  • Asset Account for Supplier Deposits: This account is used to track deposits you make on purchase orders. If you enter an amount in the Paid Today field of a purchase order, the amount will be allocated to this account.
  • Expense (or Contra) Account for Discounts: This account is used to track early-payment discounts suppliers give you when you pay your bill in full. Early payment discount conditions are set up in the credit terms of the purchase, and can also be entered in the Pay Bills window.
  • Expense Account for Late Charges: This account is used to track finance charges you pay to suppliers. The late payment finance charge conditions are set up in the credit terms of the purchase, and can also be entered in the Pay Bills window.

Payroll linked accounts [Plus, Premier Australia only]

Go to Setup menu > Linked Accounts > Payroll Accounts

  • Bank Account for Cash Payments: This is the bank account from which you withdraw cash to pay employees. The account will automatically be adjusted when you record a pay run. Alternatively, this can be a clearing account that helps you track the total cash that needs to be withdrawn from your bank account. See also Process cash, cheque and electronic pays.
  • Bank Account for Cheque Payments: This is the bank account from which you write cheques to pay employees.
  • Bank Account for Electronic Payments: This is a clearing account that’s used to keep track of electronic payments that haven’t been processed yet for your employees. The payments are cleared from this account and withdrawn from your bank account when you process them using the Prepare Electronic Payments window. See also Electronic payments.
  • Default Employer Expense Account: This is the default account that’s used for Employer Expense type payroll categories. Employer Expense categories are used to track payments you make on behalf of your employees, eg. WorkCover Insurance. You can specify a different account when setting up the payroll categories. See also Payroll categories.
  • Default Wages Expense Account: This is the default account that’s used for Wages type payroll categories. Wages categories are used to track employee wage and salary expenses. You can specify a different account when setting up the payroll categories. See also Payroll categories.
  • Default Tax/Deductions Payable Account: This is the default account used for Deductions and the Tax type payroll categories. You can specify a different account when setting up the payroll categories. See also Payroll categories.

Why can’t some linked accounts be changed? There are two feature-level linked accounts that can’t be changed - The Current Earnings and Retained Earnings accounts. These must be kept as is. If you have a partnership or trust and want to split the current or retained earnings, see Distributing profit and loss to learn how to best handle this requirement.

Why are some linked accounts not shown as linked in the Accounts List? The Accounts List only indicates the linked accounts that are set up at the feature level. When setting up items, cards and other records, you can specify additional linked (default) accountssee 'Record-level linked accounts' below. These accounts won’t be shown as linked in the Accounts List window.

Can I change a linked account at any time? You can, but it can affect your reports, especially reconciliation reports, like the Receivables Reconciliation, Payables Reconciliation and Inventory Reconciliation reports. These reports assume the linked account has not changed during the selected reporting period, and so may not show complete information.

Record-level linked accounts

Accounts linked at the record level are those that you’ve selected as the default accounts used for particular cards, items, tax codes, payroll categories, and other records. For example, when setting up a customer card, you can select a default income account to use when creating a sale for them. That account is now linked to the card.