2023 Computerised Accounting Study Guide

Module:
Computerised Accounting
STUDY GUIDE
1
Copyright © Educor 2021
All rights reserved. No part of this publication may be reproduced, distributed, or transmitted in any
form or by any means, including photocopying, recording, or other electronic or mechanical
methods, without the prior written permission of Educor Holdings. Individual’s found guilty of
copywriting will be prosecuted and will be held liable for damages.
2
1 About Damelin
Damelin knows that you have dreams and ambitions. You’re thinking about the future, and how the
next chapter of your life is going to play out. Living the career you’ve always dreamed of takes some
planning and a little bit of elbow grease, but the good news is that Damelin will be there with you
every step of the way.
We’ve been helping young people to turn their dreams into reality for over 70 years, so rest assured,
you have our support.
As South Africa’s premier education institution, we’re dedicated to giving you the education
experience you need and have proven our commitment in this regard with a legacy of academic
excellence that’s produced over 500 000 world – class graduates! Damelin alumni are redefining
industry in fields ranging from Media to Accounting and Business, from Community Service to Sound
Engineering. We invite you to join this storied legacy and write your own chapter in Damelin’s history
of excellence in achievement.
A Higher Education and Training (HET) qualification provides you with the necessary step in the right
direction towards excellence in education and professional development.
2 Our Teaching and Learning Methodology

Damelin strives to promote a learning-centered and knowledge-based teaching and learning
environment. Teaching and learning activities primarily take place within academic programmes and
guide students to attain specific outcomes.
• A learning-centered approach is one in which not only lecturers and students, but all
sections and activities of the institution work together in establishing a learning
community that promotes a deepening of insight and a broadening of perspective with
regard to learning and the application thereof.
• An outcomes-oriented approach implies that the following categories of outcomes are
embodied in the academic programs:
• Culminating outcomes that are generic with specific reference to the critical cross-field
outcomes including problem identification and problem-solving, co-operation, self-
organization and self-management, research skills, communication skills,
entrepreneurship and the application of science and technology.
• Empowering outcomes that are specific, i.e. the context specific competencies students
must master within specific learning areas and at specific levels before they exit or move
to a next level.
• Discrete outcomes of community service learning to cultivate discipline-appropriate
competencies.
3
Damelin actively strives to promote a research culture within which a critical-analytical approach and
competencies can be developed in students at undergraduate level. Damelin accepts that students’
learning is influenced by a number of factors, including their previous educational experience, their
cultural background, their perceptions of particular learning tasks and assessments, as well as
discipline contexts.
Students learn better when they are actively engaged in their learning rather than when they are
passive recipients of transmitted information and/or knowledge. A learning-oriented culture that
acknowledges individual student learning styles and diversity and focuses on active learning and
student engagement, with the objective of achieving deep learning outcomes and preparing students
for lifelong learning, is seen as the ideal. These principles are supported through the use of an engaged
learning approach that involves interactive, reflective, cooperative, experiential, creative or
constructive learning, as well as conceptual learning via online-based tools.
Effective teaching-learning approaches are supported by:
• Well-designed and active learning tasks or opportunities to encourage a deep rather than
a surface approach to learning.
• Content integration that entails the construction, contextualization and application of
knowledge, principles and theories rather than the memorization and reproduction of
information.
• Learning that involves students building knowledge by constructing meaning for
themselves.
• The ability to apply what has been learnt in one context to another context or problem.
• Knowledge acquisition at a higher level that requires self-insight, self-regulation and self-
evaluation during the learning process.
• Collaborative learning in which students work together to reach a shared goal and
contribute to one another’s learning at a distance.
• Community service learning that leads to collaborative and mutual acquisition of
competencies in order to ensure cross cultural interaction and societal development.
• Provision of resources such as information technology and digital library facilities of a high
quality to support an engaged teaching-learning approach.
• A commitment to give effect teaching-learning in innovative ways and the fostering of
digital literacy.
• Establishing a culture of learning as an overarching and cohesive factor within institutional
diversity.
• Teaching and learning that reflect the reality of diversity.
• Taking multi-culturality into account in a responsible manner that seeks to foster an
appreciation of diversity, build mutual respect and promote cross-cultural learning
experiences that encourage students to display insight into and appreciation of
differences.
4
2.1 Icons
The icons below act as markers, that will help you make your way through the study guide.
Additional Information
All supplementary and recommended learning resources
Announcements
Important announcements made via myClass
Assessments
Continuous and Summative Assessments
Audio Material
Audio recordings and podcasts
Calculator
Activities that require calculation and equation base solutions
Case Study
Working examples of concepts and practices
Chat
A live chat with your Online Academic Tutor
Discussion Forum
Topic to be explored in the weekly discussion forum
5
Glossary
Learning activity centered on building a module glossary
Group Assignment
Assignments to be completed with peers
Help
Instructions on how to receive academic support and guidance
Individual Assignment
Assignments to be completed individually
Lesson Material
Learning content in myClass as per the units below
Module Information
Important information regarding your module like outcomes, credits,
assessment, and textbooks
Module Welcome
A welcome to the module in myClass to introduce you to the module and
important module information
Outcomes
Learning outcomes you will meet at the end of a section or module
Survey
A poll, feedback form or survey to complete
6
Practice
Indicates an activity for you to practice what you’ve learnt
Lesson/Virtual Class
Virtual Class links available via myClass
Quote
A thought, quote or important statement from a thought leader in the
specialist field
Reading
Prescribed reading material and module textbooks
Revision
Questions and activities that will support your module revision
Self-Assessment Quiz
Weekly quizzes to complete to self-measure if you have a complete
understanding of the lesson material
Shout Out | Example

Examples and highlights to contextualise the learning material, critical
concepts and processes
Lesson Material
Indicates sections of learning material in myClass
Thinking Point
A question, problem or example posed to you for deeper thinking,
interrogation, and reflection
7
Time
The allocated time required per week, unit and module related to the
module credit structure as per your factsheet
Video
Additional videos, video tutorials, desktop capture/screen recording and
other audiovisual supplementary material
Vocabulary
Important words and their definitions that aid the development of your
specialist vocabulary
3 Introduction to the Module
Welcome to Computerised Bookkeeping
Computerised Bookkeeping learning area is the fourth learning area in the ICB Accounting Certification
Programme and has been designed to show you how to take the manual bookkeeping system and
completing it using computer tools.
3.1 Module Information
3.2 Outcomes
3.3 Assessment
3.4.1 Formative Assessment
3.4.2 Summative Assessment
The summative assessment will assess you to determine whether all the assessment criteria for all
outcomes have been met.
8
4 Module Pacing
This module consists of 12 Chapters divided into the weeks as indicated below.
Weeks WEEKLY TOPICS FOR THE SEMESTER Reference
1 Installation and Registration of Pastel Partner Chapter 1
2 Pastel Language and Navigation Chapter 2
3 Creating and Setting up a Company in Pastel Partner Chapter 3
4 Create and Maintain General Ledger Accounts Chapter 4
5 Create and Maintain Suppliers Accounts Chapter 5
6 Create and Maintain Customers Accounts Chapter 6
7 Create and Maintain Inventory Items Chapter 7
8 Take on Balances Chapter 8
9 Supplier Processing Chapter 9
10 Customer Processing Chapter 10
11 Cashbook Processing Chapter 11
12 Bank Reconciliation Chapter 12
9
4.1 WEEK 1: INSTALLATION AND REGISTRATION OF PASTEL PARTNER
This week we will cover:
how to Install and Register Pastel Partner as an Educational Version, start

Purpose and end the program and resolve the Decimal Separator.
By the end of this week, you will be able to:
• Explain the minimum hardware requirements for installing pastel

Partner
• Choose the correct regional and date settings
• Install Pastel Partner
Learning
• Navigate in Pastel Partner
Outcomes
• Start and end the program
• Resolve the Decimal Separator
It will take you 2 hours to make your way through this study week.
Time
Computerised Bookkeeping, Pastel Accounting Version 18, Edge Learning

Media
Prescribed
Reading
4.1.1 HARDWARE REQUIREMENTS

Pastel Partner requires a computer equipped with a DVD-ROM, Microsoft Windows XP, Microsoft
Windows Vista, Microsoft Windows 7 or Microsoft Windows 10. For a single user version, or a
workstation on a multi-user version, the minimum requirements are: 512 MB RAM (We recommend
1GB or higher) Screen Resolution of 1024 x 768.
For a server, the minimum requirements are: 1GB RAM plus 512MB RAM per user Pentium IV Sage
Pastel Partner will run on the following operating systems: Windows XP Professional SP3 Windows
Vista Windows 7 and Windows 10.
10
Neither Windows XP Home nor Vista Home can be used in a multi-user environment.
Internet Explorer 6 or higher is required for the installation to continue.
4.1.2 INSTALLATION AND REGISTRATION OF PASTEL PARTNER

PRIOR TO INSTALLATION:
• Ensure that the minimum system requirements are met. These requirements are detailed
above.
• Restart your system before installation to ensure that the resources for the installation
process are cleared.
• Login as the Administrator of the PC. This will ensure that you have all the necessary rights in
order to install your software.
• Disable any virus checking software for the duration of the installation only. This is necessary
because anti-virus software blocks writing to system files (e.g.*.VBX,*.DLL,*.OCX files) and
the updating of some of these files may be required during installation.
PASTEL INSTALLATION
1. Insert the Pastel Partner Installation DVD into the DVD-ROM
2. Select the run autorun.exe.
3. Select Pastel Partner
4. Read the dialog on the install wizard screen and then select next.
5. 7. Read the software licence agreement screen and select next
6. On the setup type screen select the typical installation.
7. Click next
8. The default C-drive is selected. If you want to change this you can select change otherwise
select next.
9. Select the install button to start the installation.
10. When installation is complete the install shield wizard completed screen displays
11. Click the finish button to complete the installation
12. The sage pastel icon will now appear on your desktop.
STARTING PASTEL PARTNER

You can start Sage Pastel Partner in two ways:
1. Locate the Sage Pastel Partner icon on your desktop, Double click the icon to start the system
2. Alternatively, from the Start menu, choose All Programs, Pastel Partner.
REGISTRATION OF PASTEL PARTNER

You will have to register your package before you can make full use of it. To register, you need to
obtain a Registration Code from Sage Pastel. You will also need to register if you install the system on
another computer, or if you add more features. When you register, you do not lose any data you
entered prior to registration. Your Educational version will remain active for a limited period of time.
11
1. open pastel partner by clicking on the pastel icon on your desktop. The “Welcome to Pastel”
screen displays. (Refer to Figure 1.1)
Figure 1.1 Welcome to Pastel screen
2. Select the next button the registration type screen displays (Refer to Figure 1.2)
Figure 1.2 Registration Type screen
3. Select “Single User/Server” Registration and click next.

4. The Registration Details screen appears. (Refer to Figure 1.3)
12
Figure 1.3 Registration Details
5. Select “Educational Pack” and make sure that “Register Online” is not selected.
6. Press Ctrl + Shift + T and a registration code dialog box appears (Refer to Figure 1.4)
Figure 1.4 Registration Assistant
7. Enter the authorization pin exactly as per your student manual or disk.
8. Click OK.
9. A screen displaying a summary of your registration details appears. (Refer to Figure 1.5) Click
Next and then Finish.
13
Figure 1.5 Registration Assistant Summary Screen
4.1.3 DECIMAL SEPARATOR ERROR

when opening the pastel for the first time you may receive an error massage that reads:
the decimal/thousand separators for number and currency formats are not the same.
TO RESOLVE THE DECIMAL SEPERATOR

1. Click on start button at the bottom left hand corner of your screen and then click on the
control panel link.
2. This may differ depending on the windows that you are using.
3. Select regional and language option and the following screen displays: (Refer to Figure 1.6)
14
Figure 1.6 Region Screen – Format Tab
4. Insure that the format is English

5. At the bottom right corner select additional settings.
6. Ensure that the Numbers tab is formatted as below. (Refer to Figure 1.7)
15
Figure 1.7 Customize format screen – Numbers Tab
7. Next select the currency tab and ensure the following have been selected. (Refer to Figure
1.8)
16
Figure 1.8 Customize format screen – Currency Tab
8. Set the time format as follows: (Refer to Figure 1.9)
17
Figure 1.9 Customize format screen – Time Tab
9. Select the Date tab, and the following screen displays: (Refer to Figure 1.10)
18
Figure 1.10 Customize format screen – Date Tab
10. Ensure that the date format is set so that the Short Date Format reads dd/MM/yy and that
the Long Date Format reads dd MMMM yyyy
11. Once all the settings are set, select apply
12. Restart you PC in order for the new settings to take effect.
13. After restarting the computer, you can now open pastel.
19
4.2 WEEK 2: PASTEL LANGUAGE AND NAVIGATION
• Pastel Language and navigation

• The Menu bar.
Purpose
• Relate standard bookkeeping terminology to terminology used in

Pastel Partner
Learning • Navigate in Pastel using the different options available
Outcomes • Use the functions and shortcut keys
Time

Media
Prescribed
Reading
4.2.1 PASTEL LANGUAGE AND NAVIGATION

In accounting, the financial transactions are recorded, processed and presented to generate financial
statements that is useful in making decisions. Traditionally, accounting is done manually, by a
trained accountant, with the use of registers, account books, vouchers etc. But with the emerging
technology, nowadays, computerized accounting is in vogue, due to its accuracy, convenience and
speed.
Both manual and computerized system is based on the same principles, conventions and concept of
accounting. However, they differ only in their mechanism, in the sense that manual accounting uses
pen and paper, to record transactions, whereas computerized accounting makes use of computers
and internet, to enter transactions electronically.
PASTEL LANGUAGE
In a manual bookkeeping system, we deal with books of first entry called journals. In Pastel we refer
to books of first entry as entry types.
20
In a manual bookkeeping system transactions are record in books of first entry and then posted to a
book of final entry, called a general ledger. In Pastel we update journal batches to the general ledger
and Pastel automatically generates the general ledger and trail balance.
The information that is recorded in the books of first entry is extracted from source documents.
Some examples of source documents are:
• Cheque
• Deposit Slip
• Cash Purchases
• Original invoice from a Supplier
• Original Credit Invoice from a Supplier
• Credit Sales
• Duplicate Credit Note
• Journal Voucher
DIFFERENCE BETWEEN MANUAL AND COMPUTERISED ACCOUNTING

In accounting, the financial transactions are recorded, processed and presented to generate financial
statements that is useful in making decisions. Traditionally, accounting is done manually, by a
trained accountant, with the use of registers, account books, vouchers etc.
With the emerging technology, nowadays, computerized accounting is in vogue, due to its accuracy,
convenience and speed. Both manual and computerized system is based on the same principles,
conventions and concept of accounting. However, they differ only in their mechanism, in the sense
that manual accounting uses pen and paper, to record transactions, whereas computerized
accounting makes use of computers and internet, to enter transactions electronically.
COMPARISON BETWEEN MANUAL AND COMPUTERIZED ACCOUNTING

BASIS FOR MANUAL ACCOUNTING COMPUTERIZED ACCOUNTING
COMPARISON
Meaning Manual Accounting is a system of Computerized Accounting is an
accounting that uses physical accounting system that uses an
registers and account books, for accounting software, for recording
keeping financial records. financial transactions electronically.
Recording Recording is possible through Data content is recorded in
book of original entry. customized database.
Calculation All the calculation is performed Only data input is required, the
manually. calculations are performed by
computer system.
Speed Slow Comparatively faster.
Adjusting entries It is made for rectification of It cannot be made for rectification of
errors. errors.
Backup Not possible Entries of transactions can be saved
and backed up
Trial Balance Prepared when necessary. Instant trial balance is provided on
daily basis.
Financial Statement It is prepared at the end of the It is provided at the click of button
period, or quarter.
21
NAVIGATING IN PASTEL
One method of navigating around in Pastel Partner is by using the function and shortcut keys. These
can have a huge impact on how efficient you are in using Sage Pastel Partner as they can save you a
lot of time. Learning these would be very beneficial to you.
FUNCTION KEYS
Each of the Function or F keys just above your numbers on your keyboard, perform different
operations in Sage Pastel Partner.
SHORTCUT KEYS
4.2.2 WORKING WITH THE DEMO AND NAVIGATING

1. On the desktop, double click on the Pastel Partner icon.
2. The programme pastel opens
3. From the menu bar select File.
4. From the drop-down menu select Open.
22
5. The following screen displays (Refer to Figure 2.1)
Figure 2.1 Open Company Screen
6. Select the demo company and select Open

7. If you are asked to put a password type demo as your password and click ok.
Figure 2.2 Demo Company Screen
For now, we are going to concentrate on the menu bar
23
THE MENU BAR
As we go through each option, click on the function in order to be able to relate it to the screens that
are displayed.
The menu bar is as follows: (Refer to Figure 2.3)
Figure 2.3 The Menu Bar
FILE (Refer to Figure 2.4)
Figure 2.4 The File Menu
The File Menu is where you create new companies, delete companies, backup and restore them.
Each company is a separate set of books / accounts.
When you open Pastel the first step is to make sure you are working in the right company.
EDIT (Refer to Figure 2.5)
24
Figure 2.5 The Edit Menu
The Edit Menu is where you create and edit the Masterdata / Masterfiles for the company.
This includes adding (or editing) Customers (Debtors), Suppliers (Creditors), Inventory Items and
General Ledger accounts.
You would do this as and when you need to create a new customer or a new inventory item that you
are bringing into stock.
Adding or Changing MasterData doesn’t result in any financial transactions being processed so it
won’t have a direct impact on the Trial Balance or Financial Statements of the company. However, it
needs to be setup before you can do any processing.
PROCESS (Refer to Figure 2.6)
25
Figure 2.6 The Process Menu
The process menu is where the majority of the day to day work is done in Pastel.
Here you will find functions to process the various types of transactions.
This includes:
• For Customers – Quotations, Tax Invoices and Credit Notes
• For Suppliers – Purchase Orders, Goods Received Notes (GRN’s), Supplier Tax Invoices and
Return and Debit notes
• For Bank and Petty Cash accounts – Cash Book processing.
As Pastel is an integrated system, as you process these transactions it will automatically create the
necessary postings to the General Ledger accounts.
VIEW (Refer to Figure 2.7)
26
Figure 2.7 The View Menu
From time to time, you will need to get information out of the system. You do this by running
different reports that Pastel provides.
You will find these under the View Menu. There are many different types of reports available
including Customer Reports (such as an Age Analysis), Supplier Reports (such as Supplier Balances),
Inventory Reports as well as the Trial Balance and Financial Statements.
CHANGE (Refer to Figure 2.8)
27
Figure 2.8 The Change Menu
The Change Menu includes various miscellaneous functions.
This includes running month end and year end processes i.e. changing the period the system is
currently set to. It also includes functions to make changes to Master Data and Setup related items
e.g. changing from open item to balance forward and deleting inactive customers / suppliers.
SETUP (Refer to Figure 2.9)
28
Figure 2.9 The Setup Menu
The Setup is normally done immediately after creating a new company. This involves setting up the
default rules e.g. when creating a new customer what should the default credit terms be, should the
customer be processed on an open item or balance forward basis.
The Auto Setup is an assistant in Pastel which will take you step by step through each of these
screens.
UTILITY (Refer to Figure 2.10)
29
Figure 2.10 The Utility Menu
The utility menu allows you access to various functions such as Calculator etc.
FAVOURITES (Refer to Figure 2.11)
Figure 2.10 The Utility Menu
If you access certain functions often you can add them to the Favourites Menu so that you are able
to access them more easily.
HELP (Refer to Figure 2.12)
Figure 2.10 The Help Menu
You can access various help functions for Pastel under the Help Menu.
30
CONCLUSION
• The bookkeeping cycle remains the same in a computerized bookkeeping system, it is only
the terminology and processing that differentiate.
31
4.3 WEEK 3: COMPANY CREATION AND SETUP
Gathering all relevant information and creating a new company.

Purpose
Learning • Creating a New Company using Pastel V18

Outcomes • Set up the company according to its stated requirements.
Time

Media
Prescribed
Reading
4.3.1 CREATING A NEW COMPANY

When creating a new company, the first thing to do is to gather all the relevant information
regarding the company you will be creating.
PLANNING
Following is a proposed form to be completed to ensure you have most of the information to start
creating your company in Pastel.
32
Company Information
Company Name:
Trading Name of Company:
Company Contact:
Name:
Surname:
Post Held:
Address:
Type of Company:
Postal Address: Postal Code
Physical Address: Postal Code
Telephone Number:
Email Address:
Website Address:
Company Registration No:
Company Vat Registration No:
Financial Year Dates:
Start:
End:
Banking Details (add additional fields as required all bank accounts must be listed)
Bank:
Branch:
Account Number:
Petty Cash (yes/No)
Customers Price Lists:
Price List 1:
Price List 2:
Price List 3:
Default Customer Terms:
Monthly Payment Terms:
Processing Method (Tick applicable method)
Open Item:
Balance Forward:
Type of Stationery to be used (Tick applicable type)
Pre-Printed
Plain
Single Sheet
Continuous Paper
Type of Printer (Tick applicable Printer)
Lazer/Inkjet:
Dot Matrix:
Pastel allows you to maintain as many separate sets of books as you require. Each company is a
separate financial entity.
33
Within each company you create users with different access levels. You have to log in as a user in
order to get access to that company’s information or work in the company. You can specify which
area of the system a user can or cannot access. This allows you to control access to sensitive
information.
EXERCISE 3.1
Nozibini provides you with the following information for creation of the company on Pastel
Company Name: RE12345 were 12345 is the Last 5 digits of your Student Number
Company Trading Name: Nozibini Beauty Creations
Date format: Y/M/D, with Four Digit Format
Financial year end: 28 February 2019 (period ends on last day of month)
Number of periods: 12
Chart of accounts: Retail
Cash Books: 2 (ABSA Bank and Petty Cash)
Inventory prices: Local, Export, Cash (Local is the most common)
Default terms: Period based, 60 days
Customer defaults: Open item
Paper style: Plain, Continuous sheet.
VAT Registration Number: 4250279870
Company Registration No: 2017/721650/08
E-mail address: info@nozibeauty.com
Physical Address: 67 Straight Street, Sabie, 1628
Telephone Number: 016 259 4618
Fax Number: 086 259 4619
CREATING A NEW COMPANY IN PASTEL PARTNER

1. From the Menu bar select File > New.
3. Under New Company Name you enter an 8-digit character, alpha and numeric. To identify
the company that you are creating. enter RE followed by the last 5 digits of your Student
Registration Number.
34
Figure 3.1 The New Company Screen
There are 4 different methods to create a company:

• Use setup assistant – this is the recommended method. You will be taken through a series of
screens in which specific information will be captured about the company. The set up
assistant guides you through all parameters required to set up the a fully working company,
in which you can start working.
• Copy another company – this option allows you to make an exact copy of an existing
company.
• Start a new company – in this option, the new company is created from scratch. you would
need to set up all parameters, chart of accounts, entry types and so on, yourself. This method
is extremely time consuming.
• Create from Backup – this option is used when you have a backup of a company and need
to create the company using a backup.
4. Select the option Use Setup Assistant.

5. Click the “Create” button.
6. The Pastel Setup Assistant screen displays as follows, read the screen and select Next. (Refer
to Figure 3.2)
35
Figure 3.2 The Setup Assistant Screen
7. The Company Information screen displays.

8. In the Company Name field, type the Full Company Name, i.e. Nozibini Beauty Creations.
In the Postal Address field, you would type the Postal address as given.
In the Information Field, type details such as: Company Telephone and Fax Numbers, E-mail
address, Company Registration Number, and more importantly, the Company VAT
Registration Number.
Note that the VAT Reg. No is typed here, as we are creating a “dummy” company, and as
Pastel will verify the VAT No, it will reject the Number when it is typed in the allotted field further
on.
9. Your Company Information screen should be similar to the one displayed (Refer to Figure
3.3). Click next.
36
Figure 3.3 The Company Information Screen
10. The Date Format screen displays, select Y/M/D, with Four Digit Format. (Refer to Figure 3.4)
and click Next.
37
To create a company, select the File...New menu option.
In the left frame, specify where to create the company.
In the New Company Name field, enter a unique 8-character name
Choose Use Setup Assistant and then click on the Create button.
After this introductory screen, follow the instructions on the screen to move through the process of
creating the company.
Company Information
Enter your organisation’s details on this screen.
Date Format
Select the date format that reflects how you would like the date to be shown. The format should be
the same as that used by the computer for other applications
Period Setup
Figure 3.4 The Date Format Screen
Setup Enter the date of the first day of the financial year that you are capturing into Pastel. Many
Figure 3.4 The Date Format Screen
The Period screen displays. (Refer to Figure 3.5)
If you are capturing a backlog of financial data, then enter the start date of the relevant
financial year. Each period is a time frame as set by the user and is not necessarily a calendar
month. However, the default setting is a calendar month. Most organisations will end each
period on the last day of each calendar month. If necessary go to the Setup menu, under
Periods to change the period start and end dates for each individual period.
11. Select 2018/03/01 as the start date of the current financial year and click Next.
38
Figure 3.5 The Period Setup Screen
12. The Period Setup Continued screen displays, (Refer to Figure 3.6)
Most organisations operate in 12 periods that match the 12 months of the financial year. It
is possible to use a 13th period for the 1st period of the next financial year. This allows the
user to capture the 1st month without processing a year-end at the end of the previous
financial year. This function is useful when it is necessary to process real-time transactions in
the new month but the last month of the financial year has not yet been finalised, for
example, processing invoices to customers.
When using this function it is important that the last month of the financial year be finalised
before the end of the following month, as month 2 will need to be captured in the new
Pastel company. Many organisations take a few months to finalise their year-end and
therefore do not find this function useful. Therefore, it is recommended that you only use
12 periods. Enter the Number of Periods as 12 and select Next.
39
Figure 3.6 The Period Setup Continuation Screen
13. The Chart of Accounts screen displays as shown (Refer to Figure 3.7).
The default chart of accounts has been modified for best use with the Project Tracking
module. Therefore the accounts are listed by income or expense type (by the nature of the
income / expense). All other groupings and categorisations of income and expenses such as
by project, funder or region should be achieved in the Project Tracking module.
You are able to change / add / delete accounts using the options under the Edit menu in order
to customise the chart of accounts to suit the needs of your organisation.
Select Retail from the drop-down menu, and then select Next. (Refer to Figure 3.7)
40
Figure 3.7 The Chart of Accounts Screen
14. Then Click on Account Name under Cashbook /Bank Account Description. Then rename the
account name in line with the instructions given (Refer to Figure 3.8) Enter the number of
cashbooks to create.
Create a cash book for every bank account and every cash box that you manage. For
example, you may have at least a current account, an investment account and a petty cash
box or you may have multiple investment accounts, and select Next.
41
Figure 3.8 The Cashbook/Bank Accounts Screen
15. Inventory prices - often companies have different prices for different customers e.g. Local,
Export and Cash Customers. Some organisations do not sell inventory items and therefore
do not have to set up Price Lists.
For those that do sell inventory, in cases where there are multiple price lists, for example, a
price for funders, one for partners / friends of the organisation and one for the general
public, enter a description for each price list that the company will use. (Refer to Figure 3.9)
Type the Price Lists as given in the Exercise and select Next.
42
Figure 3.9 The Inventory Price Lists Screen
16. The Default Terms screen displays; this helps you to set the default terms for all
customers, i.e., how long you expect customers to take to pay you. (Refer to Figure 3.10)
Most organisations do not follow up their customer invoices on a day-basis but rather allow
a month or more for payment before following up. Therefore, select Period (Month) Based.
It is recommended that the terms be current so that payment can be expected upon
presentation of the invoice to the customer.
The Terms can be:

• Period (month) Based - then you select Current / 30 / 60 / 90 or 120 days, or
• Day Based – You specify how many days the customer should take before paying
you.
In this case select Period Based, then 60 days as per the Exercise and select Next.
43
Figure 3.10 The Default Terms Screen
17. The Customer Defaults screen displays next, read the screen carefully and select Open Item
then select Next. (Refer to Figure 3.11)
44
Figure 3.11 The Customer Defaults Screen
18. The Document Printing screen displays; Use the Paper Style Assistant to choose the type of
paper that you print invoices on. You can select plain paper, pre-printed or header pre-
printed and single or continuous paper. The most common setting is plain, single sheet.
(Refer to Figure 3.12)
Click on Paper Style Assistant, Choose Plain and click Next, Select Continuous Paper and click
Next When done select Finish.
19. Click Next.
45
Figure 3.11 The Documents Printing Screen
20. The Create Company screen displays, select Process. When the operation completes, select
Finish. (Refer to Figure 3.12)
46
Figure 3.12 The Operation Complete Screen
The User Security Screen displays. Create a Password. It is advisable to create as short and
memorable a Password, as you are going to use it repeatedly as you process items. (Refer to
Figure 3.13)
21. Click OK
47
Figure 3.13 The User Security Screen
You have now set up a company. Each time you close it by either going to the File then exit Pastel
option on the menu bar or selecting the close icon on the top right corner of your screen, it will
display a dialogue giving you the option to Backup, for now select No, we will explore the Backup
process later.
4.3.2 SETTING UP NEW COMPANY

All changes made under the Setup Menu on the Menu bar, generally affect the company as a whole.
For example, when Default terms are setup under the Customer Control, all customers will be
affected. Individual changes must be done under the Edit Customer menu item.
To confirm your global settings it is therefore important to recheck some of the Setup options
automatically configured when the Setup Assistant was used to create the company.
48
All subsequent configurations and setting discussed here are accessed by selecting Setup from the
Menu bar.
SETUP COMPANY PARAMETERS

Enter your organisation’s details under Name and Address. For organisations that prepare invoices
you will need to check the Document Numbers section. Many organisations use one set of numbers
throughout the organisation. Change the document numbers to reflect next number in the
numbering sequence you are using.
Go through the other tabs to ensure that all the default settings are appropriate for your
organisation.
SETUP USERS/PASSWORDS
It is recommended that you set up at least one user password so that the sensitive accounting
information is protected from unauthorised viewing.
An additional user and password, linked to the View Only user group, may be useful for
management to review the accounting information without being able to change anything.
You should also restrict which areas of the system each user can access. There are two functions for
this purpose:
• User groups – Allows you to assign access security on a group basis. The system creates
standard user groups some of which you can modify. You can also create your own user
groups.
• Individual users – These users each have their own unique password. Alternatively you can
set up specific security rules per user.
SETUP FINANCIAL CATEGORIES

Every ledger account must be allocated to an appropriate financial category in order to reflect in the
correct place in the Income Statement or Balance Sheet. Scroll through the categories and verify that
all the descriptions are suitable for your organisation.
SETUP REPORT WRITER CATEGORIES

Allocating general ledger accounts to a report writer category allows you to group ledger accounts
in a different way to the financial categories. Custom reports can be prepared using the report writer
category groupings. You may need to add additional report writer categories in order to prepare
reports that are relevant to your organisation. However, it is best to leave the categories as they are
and return to this set up option when you are ready to prepare the custom reports.
SETUP ENTRY TYPES

Create an entry type / cash book for every bank account and every cash box that you manage. For
example, you may have at least a current account, an investment account and a petty cash box or
you may have multiple investment accounts. Always tick ‘Contra in Detail’ for journal entry types.
49
SETUP PERIODS
To quickly edit the periods to match the financial year that you are capturing, enter the start and
end date of the first period of the financial year and click Create. To change the Last Year Periods,
enter the start and end date of the first period and thereafter only enter the end date of each
period, the start date will change automatically. You will need to type in the period descriptions for
each month.
Most organisations operate in 12 periods that match the 12 months of the financial year. It is
possible to use a 13th period for the 1st period of the next financial year. This allows the user to
capture the 1st month without processing a year-end at the end of the previous financial year. This
function is useful when it is necessary to process real-time transactions in the new month but the
last month of the financial year has not yet been finalised, for example, processing invoices to
customers. When using this function it is important that the last month of the financial year be
finalised before the end of the following month, as month 2 will need to be captured in the new
Pastel company. Many organisations take a few months to finalise their year end and therefore do
not find this function useful.
SETUP TAX
If you are not registered for VAT select the ‘Do Not Use Tax’ tax system. However, if you are
registered for VAT you select either Normal VAT (Invoice basis) or Payment Based VAT. You will
need to refer back to your VAT registration letter to establish which basis of VAT you are registered
under.
• Normal /Invoice based VAT – VAT is due to SARS by your organisation at the time of issuing
a customer invoice, regardless of whether you have received payment or not, and VAT is due
to your organisation from SARS at the time of receiving the supplier invoice even if you have
not paid it yet. A VAT control account is used to reflect the input and output VAT.
• Payment Based VAT – VAT is only due to SARS by you once you have received payment for
your customer’s invoice, even if this is some time after issuing the invoice, and VAT is only
due to you from SARS once you have paid your supplier’s invoice. The VAT is entered into a
provision account at the time of raising the customer or supplier invoice and is moved to the
VAT control account when the payment that has been received or made is matched to the
invoice in the cashbook.
EUROPEAN UNION SETUP

Unless you operate in the European Union and use the Multi-currency module, you can skip this
section.
SETUP CUSTOMER CONTROL

• Configuration tab
The interest rate you specify will be the default for all your customers, but you can modify
it for individual customers when you create them or later by editing the individual
customer’s account. Interest will not just happen automatically – you will have to create
the accounting entry for the interest.
50
when a customer’s account is overdue is a good way to help control your (potential) bad
debts.
VAT legislation requires that all customers be identified on the VAT invoices they receive
when purchasing for more than R3,000 per invoice. Although you will already have the
customer name and VAT number stored in Pastel for your regular customers, your ad-hoc
or cash customers will not be recorded separately. The amount entered as the ‘Tax ref.
prompt amount’ will help the person capturing the invoice to remember to ask for the
required details.
The user-defined fields are extra information you may require. The items you type here,
basically becomes the field names in the customer master file.
• Statements tab
Customer statements are documents you print and send to your customers. It lists the
details of transactions together with the most recent payment transactions (open item) or
just print the balance owed from previous months together with the details of the most
recent transactions (balance forward).
Despite having an open item customer, you can still print the monthly statement for the
customer in balance forward view, should you or the customer prefer it.
You can customise the messages that you want to print automatically to your customers,
depending on how long amounts are outstanding
• Defaults tab
The normal payment terms, processing method and most common price list was selected
when you created the new company, but here you have the opportunity to change it.
The tax entry method you chose will depend on your business. Most businesses’ sales
prices are shown inclusive of VAT. This will make the capturing of the prices inclusive of
VAT much easier. So, it depends on your business. Credit limits should always be
individually set for your customers. The early payment terms are discounts given to
customers for paying early.
• Description tab
The items you type here become the field names in the customer master file, but different
to the field names typed on the configuration tab, Pastel know these are associated with
the address of the customer and will use it where required on invoices, statements, etc.
51
• Setup Customers Documents
The Setup Customer Documents in Pastel contain the various source documents relating to
customers. Note that not all of them result in a journal entry and, therefore, not all of them
result in an accounting entry in the general ledger and the customer sub-ledgers. The
details (data) of these source documents will still be stored in transaction files for
reference purposes. Quotations and Sales Orders are optional, depending on the design of
the sales process in the particular business
Ensure that you know for each source document:

• the order in which the documents are used in the sales process
• the purpose of the document
• the differences between the various source documents
• the entry type (journal) usually used by each source document
• the accounting debits and credits by a transaction using the particular source document
(remember to take VAT into consideration)
SETUP SUPPLIERS CONTROL

The setup of the suppliers control is very similar to the setup of the customers’ control. When doing
the setup for the suppliers’ control, you are specifying the terms and rules you want the majority of
your suppliers to follow, such as to enter the supplier prices including or excluding VAT and the
standard payment terms. Again you can modify this later when you create/edit an individual
supplier.
Compare the contents of the various tabs of the suppliers control setup with the contents of the
customers control setup. Note the similarities and differences.
When you are likely to sell the goods before receiving and processing the supplier invoice for the
goods, it would be necessary to use goods received notes, else your accounting system will indicate
that you are out of stock, while there will be actual stock available for selling.
Toggle between ‘Mandatory’ and ‘Never’ for goods received notes. Notice how the accrual account
is greyed out when ‘Never’ is selected.
• Remittances tab
Your supplier will send you a monthly customer statement just like you will send a monthly
customer statement to your customers. Customers use the customer statements to pay
their suppliers and often the bottom of the customer statement can be cut off and
attached as a remittance to the payment made to the supplier. In practice, separate
remittances are rarely printed and sent to suppliers to accompany the payment, but it is
still useful to help settle account disputes between customers and suppliers.
• Setup Suppliers Documents
52
The setup of the suppliers documents is very similar to the setup of the customers
documents. The Setup Supplier Documents in Pastel contains the various source
documents relating to suppliers.
Compare the contents of the various tabs of the suppliers’ documents setup with the
contents of the customers’ documents setup. Note the similarities and differences.
Note – it is important that you fully understand the difference between a customer and a
supplier. Likewise, you should know what is ageing and the difference between balance forward and
open item processing.
Make sure you know for each source document:

• The order in which the documents are used in the purchase process.
• The purpose of the document.
• The differences between the various source documents.
• The entry type (journal) usually used by each source document.
• The accounting debits and credits by a transaction using the particular source document
SETUP INVENTORY
When doing the setup for the inventory, you are specifying the terms and rules you want the
inventory items to follow, such as the various price lists used for inventory items, the maximum
selling prices and discount percentages etc.
You can modify this later when you create/edit an individual inventory item
• Configuration tab
Often employees are given authorisation to make decisions relating to sales and purchases,
but only within certain limits. Some of these limits are specified here in Pastel, so that the
employees do not overstep their authorisation.
The items listed in the processing block refer to computerised controls to help the business
achieve their profit goal. If you have selected goods received notes to be mandatory and you
control your inventory like you should, there should be no reason for inventory quantities to
ever fall below zero.
The reorder levels and the preferred suppliers will be set later when you create/edit
individual inventory items Think where each of the limits shown and the items in the
processing block will have an impact further on in the transaction processing system.
• Integration/Groups tab
Currently the default inventory groups are Services and Inventory Goods. If you wish, you
could set up multiple groups and use different. If you can separate the sales and cost of
53
sales of the various groups, you can make better decisions. To create various groups you
type the group names under the description column.
However, Pastel will not automatically know how to link (integrate) the groups with the
general ledger so you can extract the information at a later stage. Therefore we will set up
the integration here on the Inventory integration/groups tab.
When you selected an industry specific chart of accounts during the creation of the new
company on Pastel, several standard general ledger accounts were created automatically.
These include the customer and supplier control accounts you have seen so far during auto
setup, as well as the accounts visible on the integration/groups tab of the inventory setup
Now unselect the integrate inventory to general ledger tick box and see how the general
ledger accounts are affected. Select the same tick box again to see the integrated general
ledger accounts again.
• User Fields tab

These user defined fields are similar to those defined for customers and suppliers, i.e. it
becomes the field names in the inventory master file. E.g. you will be able to specify the
name of each type of inventory item for any business, but you might want to create a special
field for ingredients in food that may cause allergic reactions if your business sells food.
• Other tab
The defaults for new items on the inventory setup other tab is similar to the default tabs for
customer control and supplier control in that it will use this information as the default for
every new inventory item you are going to create. If you decided to change the description
or add more inventory groups on the configuration tab, you’d be able to select it here in the
inventory group dropdown list. The encrypted cost price is a feature if you are going to print
your own price labels and if you give some flexibility to your sales staff for negotiating sales
prices.
EXERCISE 3.2
In addition to the information provided in Exercise 3.1 the company decided to use the following
default settings:
Setup Customers Control

Configuration tab
Interest: Annual % rate 10%
Default tax type: VAT Standard Rate at 15%
Tax Ref. Prompt Amount: R3 000
User Defined Lines: Line 1: Director
Line 2: Tel No
Line 3: Manager
Line 4: Tel No.
54
Statement tab
Terms: Strictly 30 days nett
Terms +1: Settle your account ASAP
Terms +2: Contact our Legal Dept.
Default tab
Create the following Default Early Payment Terms for Customers
2.5% 30 days from invoice date
5% 14 days from invoice date
10% 1 day from invoice date
Setup Customers Documents

Quotation
Quotation message should read: Quotation valid for only 5 days. Thank you for your interest.
Tax Invoice
Tax invoice message should read: Your support is appreciated. Call again.
Setup Suppliers Control

Configuration tab
Default tax type: VAT Standard Rate 15%
User defined lines:
Line 1: Contact Person
Line 2: Tel No
Goods Received Notes: Never
Remittance Message: Kindly contact the Accounts Dept. with any queries. Thank you.
Setup Suppliers Documents

Purchase Order
Purchase Order Message: Kindly confirm delivery date with Logistics Dept. Thank you.
Invoice
Invoice Message:
Received by:
Signature:
Date:
Setup Inventory
Activate the following options for inventory:
Decimals for Quantity: Zero
Unit: Each
Allow Inventory Quantities to Fall Below Zero

Warn if Inventory Falls Below Zero
Fixed Description / Cost must be selected.
1. From the desktop select the Pastel icon and open the company that you have just created.
55
2. On the menu bar, click on Setup. The following drop-down menu displays: (Refer to Figure
3.14)
Figure 3.13 The Setup menu
Set up Company Parameters.

3. From main menu, select Setup > Company Parameters. The Setup Company Parameters
screen will display - fill in the details as per the Information provided by Nozibini – Exercise
3.2 (Refer to Figure 3.15)
56
Figure 3.15 The Company Parameters Screen
4. Click on the Settings Tab, the following screen will display. (Refer to Figure 3.16)
57
Figure 3.15 The Company Parameters Settings Screen
5. fill in the details as per the Information provided by Nozibini and click OK.
Set up Tax.
6. From main menu click Setup > Tax > General Settings and select Percentages Tab, the
following screen will display. (Refer to Figure 3.16)
Ensure that the Tax rate is captured as 15%. Click OK.
58
Figure 3.16 The
59
7.
Figure 3.16 The Company Parameters Tax Screen
Setup Customers Control

7. From main menu select Setup>Customer> Control. On the Configuration tab complete all
the fields as per the Information provided by Nozibini. (Refer to Figure 3.17).
Figure 3.17 The Setup Customer Control-Statements Screen
8. Click on the Defaults tab.

9. Click the Early Payment Terms field, (Refer to Figure 3.18)
60
Figure 3.18 The Setup Customer Control-Defaults Screen
10. Click the Modify button and enter the information as provided by Nozibini. (Refer to Figure
3.19) Click OK and Close.
Figure 3.18 The Edit Early Payments Screen
61
11. Click on the Invoice tab, and type the message as provided by Nozibini. (Refer to Figure
3.19). Click OK
Figure 3.19 The Setup Customer Documents-Invoice Screen
Set up Suppliers Control.

12. From the main menu select Setup> Supplier>Control. On the Configuration Tab, enter the
User Defined details provided by Nozibini. (Refer to Figure 3.20)
Figure 3.20 The Setup Suppliers Control-Configuration Screen

Set up Suppliers Documents
13. From the main menu select Setup> Suppliers>Documents Refer to (Figure 3.21).
14. Complete the Purchase Order using the details provided by Nozibini.
62
Figure 3.21 The Setup Suppliers Documents-Purchase Order Screen
15. Complete the Suppliers Invoice message using the details provided by Nozibini. And click
OK.
Set up Inventory
16. From main menu select Setup> Inventory, the following screen displays: (Refer to Figure
3.22)
17. On the Configuration tab, change the Decimals for Quantity to 0.
18. Allow Inventory Quantities to Fall Below Zero, and Warn If Inventory Falls Below Zero
options as per the details provided by Nozibini.
Figure 3.22 The Setup Inventory-Configuration Screen
19. On the Other tab, type Each in the Unit tab and tick Fixed Description / Cost as:(Refer to
Figure 3.23). Click OK.
63
Figure 3.23 The Setup Inventory-Other Screen
CONCLUSION
• You have now learnt how to create a new company using Pastel Account V18.
• This required that you set up the company according to the company’s stated requirements.
• Should there be any field not expressly mentioned by the company in the set-up
instructions, then the system default settings will apply.
64
4.4 WEEK 4: CREATE AND MAINTAIN GENERAL LEDGER ACCOUNTS
Create and maintain general ledger accounts

Purpose
• Understand the difference between a main and a sub general

Learning ledger account.
Outcomes • Create general ledger main and sub accounts
Time

Media
Prescribed
Reading
4.4.1 CREATING AND MAINTAIN GENERAL LEDGER ACCOUNTS

The General Ledger analyses transactions and reflects the business activities of a company. The
information can be broken down further by creating more general ledger accounts, thereby getting a
more detailed analysis of the business activities. Pastel allows you 9999 general main accounts and
999 general ledger sub accounts.
You can further divide a main account into 999 sub accounts. The system totals sub accounts into their
respective main accounts. If you have sub accounts, the main account becomes a totalling account
only and you cannot post to the main account.
EDIT GENERAL LEDGER ACCOUNTS

When you selected your chart of accounts, Pastel automatically created numerous balance sheet and
income statement general ledger accounts for your business. However, as every business is unique,
you may need to add some general ledger accounts or delete some that you will not use. You may
want to block accounts, that you don’t need rather than delete it. That way it cannot be used for
transaction processing, if you need the account later, you can just unblock it again.
65
• Main Account Number – Enter the code of the new account you would like to create.
• Account Description – As this is a new account, the main account will always be created
first. The system will therefore jump to the account description; in which you type your
account name.
• Blocked – when a general ledger is no longer required it can be blocked.
Details Tab
• Income statement or Balance sheet – select whether the new account is an income
statement account or the balance sheet account.
• The income statement accounts record the income and expenditure activities of the
business in it trading.
• The balance sheet accounts record the assets and liabilities accumulated by the business.
• Financial Category – The general ledger accounts have different categories from a financial
point of view. When you create general ledger accounts, you have to allocate them to a
financial category. This field is extremely important as, if left as default – Unallocated , an
error message will display whenever the Income Statement is to be printed. Until all the
Unallocated categories have been reallocated to specific financial categories, the system
will not allow you to view the Income Statement.
• Report Writer Category – It’s a function used to write additional, advanced reports.
• External Reference – This is an optional field and may be used to note the manual system
account number for ease of referral. It is also used if you want to export and compare the
financial results of various companies using different account numbers.
• Tax Processing – This is an optional field where the tax rules for each main and sub account
can be specified.
Balances Tab
• The balances tab contains financial activities related to the specific general ledger account.
This is a view only tab any no changes can be made on this screen.
• Once processing has been done to a specific general ledger account, the account movement
and cumulative balances will start displaying on this tab for both the current and previous
years.
Notes Tab
The note Facility has a variety of uses.
• You can attach to a record as a reminder when you access a record with a note, the
system shows there are notes for the record.
• You can write mail-merge letters for customers and suppliers
• You can Link a note to an external record
• If you create custom financial reports in the general ledger report writer, you can choose
to attach notes, when the report prints, the notes will print as well.
• You can create miscellaneous notes that is not attached to any records
66
• You can specify entry and action dates on notes and you can specify whether a note is
open or closed. You can then report on overdue notes.
EXERCISE 4.1
Create a new general ledger main account
Nozibini Beauty Creations wants you to Create a new account
Account name: Security.
Account Number: 4425 /000
1. From the menu bar, select Edit >General Ledger >Accounts. The following screen displays:
Figure 4.6
Figure 4.1 The Edit General Ledger Accounts Screen
2. To create a new account, click on the Add icon. The following screen displays: (Refer to
Figure 4.2)
67
Figure 4.2 The Edit General Ledger Accounts Add New Screen
3. Main Account Number – Enter the code of the new account you would like to create - 4425
for Security.
4. Account Description – As this is a new account, the main account will always be created
first. The system will therefore jump to the account description; in which you type - Security.
5. Blocked – when a general ledger account is no longer required it can be blocked.
The Details tab

• Income statement or Balance sheet – select whether the new account is an income
statement account or the balance sheet account. In this case, Security is an expense account
and therefore an income statement account.
• Income statement Financial Category – This field is extremely important as, if left as default
I05 – Unallocated Income Statement, the following error message will display whenever the
Income Statement is to be printed.
Note: Until all the Unallocated categories have been reallocated to specific financial
categories, the system will not allow you to view the Income Statement.
68
• Report Writer Category – It’s a function used to write additional, advanced reports.
• External Reference – This is an optional field, and may be used to note the manual system
account number for ease of referral.
• Tax Processing – This is an optional field where the tax rules for each main and sub account
can be specified
4.4.2 CREATE NEW GENERAL LEDGER SUB ACCOUNTS

General ledger sub accounts provide a further analysis of the general ledger main account. Once sub
accounts are created, the main account becomes a totalling account, and no further transaction will
be allowed to be posted into the main account.
EXERCISE 4.2
Nozibini would like the following two Sub Accounts to be created on the Telephone and Fax main
account:
010 – Landline
020 – Cell Phone
1. From the menu bar, go to Edit > General Ledger > Accounts.
2. Then click on the Search icon depicted with the magnifying glass, click on Description, then
type Tel to search for Telephone and Fax account. You will notice that it is numbered
4600/000.
3. Then, from menu bar, select Edit > General Ledger > Accounts. Click on the Add Icon. In the
Main Account Number field, type 4600 and press tab. In the Sub Account field, enter 010. In
the Description Field, Type Telephone and Fax – Landline. (Refer to Figure 4.2)
69
Figure 4.2 The Edit General Ledger Accounts Add New Sub Account Screen
4. Once captured as displayed above, save and proceed to create the second Sub Account for
Telephone and Fax – Cell phone.
Tip: When creating sub accounts, always bring in part or the full description of the main
account to make searching by description easier.
Conclusion
• Structuring of the general ledger accounts in an orderly, practical and logical way is
important.
• Inventory groups are important for further analysis of sales and cost of sales in the general
ledger, by the type of product and / or service that is being sold.
70
4.5 WEEK 5: CREATE AND MAINTAIN SUPPLIERS ACCOUNTS
Create and maintain supplier accounts

Purpose
• Create and maintain supplier categories

Learning • Create and maintain supplier accounts
Outcomes • Change default settings in new accounts
Time

Media
Prescribed
Reading
4.5.1 CREATING SUPPLIERS ACCOUNTS

Information that you enter that does not change often is called static information. When you enter
details for a supplier, that information is called a Masterfile record.
There are two types of supplier Masterfiles that you can create:
• Supplier Categories
• Supplier Accounts
CREATING NEW SUPPLIER CATEGORIES

You are able to create up to 99 categories for your supplier accounts. You can link individual
suppliers to these categories. You can use these categories to sort your suppliers. For example, you
may want to sort your suppliers as local or national, or by product ranges. You do not have to use
supplier categories, and you can start or stop using them at any time. However, you cannot delete a
supplier category that has a supplier account linked to it.
You create suppliers categories as follows:

From the Menu bar, Select Edit > Suppliers > Categories.
71
Type in the description of the suppliers category and click Ok.
CREATING NEW SUPPLIER ACCOUNTS

You create a suppliers account as follows:
From the Menu bar, Select Edit > Suppliers > Accounts.
• Account Code - The recommended way of creating codes for suppliers accounts, is to use
the first three letters of the relating suppliers name as the first three characters of the code,
then use sequential numbers as the last three numbers of the code. This way coding is
consistent and searching by code or description is easy.
• Description – The description field can contain up to 40 characters. The suppliers name
should be entered here.
• Blocked – Should you not want to process any further invoices or purchases to a supplier’s
account, tick this box to block it.
• Note: When a suppliers account is blocked, you cannot process any credit values to it, but
you can process payments and debit notes to the account.
• Suppliers Category – by clicking the drop-down list, you can select a category from the list of
previously created categories.
The Contacts Tab

• None of the fields on this tab is compulsory unless you have selected to email document and
remittances to suppliers on the processing tab. Then the Email Address field will be
compulsory. It is however recommended that you enter as much information as possible.
The Processing Tab

• Exclusive / Inclusive – Choose a default setting in respect of whether prices for a specific
supplier should be entered as inclusive or exclusive of VAT.
• Default Tax – specifies whether VAT applies to the supplier or not. If a supplier is registered
for VAT, select the Default Tax option.
• Tax Code – Once the Default Tax Type has been selected, This option becomes available, and
the Tax Code can be selected,
• Tax Reference – Enter the suppliers VAT registration number here, if applicable.
• Currency Code – This option is available when the Multi Currency add-on module is being
used for foreign suppliers.
• Default Contra Account – This is an optional field. If you purchase non-inventory items from
a supplier, you could set up a default general ledger account relating to the type of expense
purchased from the supplier.
• Processing Method – When setting the supplier defaults on the Suppliers Control, the
processing method was selected. This method can be changed here if a supplier’s method
differentiate from your default setup.
72
Note - Once the Masterfile has been saved, this option will be greyed out and the only way
of changing it would be through the change option on the Menu bar.
• Terms – Enter the supplier specific terms here. (As discussed previously under Setup
Suppliers Control.)
• Printing – Various different printing options are available including “Print and Email
Remittance” as discussed earlier.
SUPPLIERS MASTER LISTINGS

You access the Suppliers master Listing in the following Way:
View > Suppliers > Listing > Accounts.
Various Print options are available:

• Reports can be displayed on the screen
• You can select to print to different printers depending on the printers set up on the
computer you are using.
• Reports can be exported to different standard document formats such as
• Word
• Excel
• Text files
• PDF files
EXERCISE 5.1
Nozibini would like the following Suppliers categories to be added.
• Services
• Goods
Create the following Supplier Accounts (No addresses / contact details are required and leave other
information as per default)
Code: SO055
Description: Sony
Processing method: Balance Forward
Normal Terms: 30 Days
Credit Limit: R700 000
Code: SA082
Description: Samsung
Processing method: Open Item
Normal Terms 90 days
73
Credit Limit: R800 000
Creating Suppliers Categories

1. From the menu bar, select Edit> Supplier>Categories.
2. The Edit Supplier Categories screen displays: (Refer to Figure 5.1)
3. Enter the required categories as per the exercise
74
Figure 5.1 The Suppliers Categories Screen
Creating Suppliers accounts

Select Edit>Supplier>Accounts. The following screen displays: (Refer to Figure 5.2)
1. Enter the information provided in Exercise 5.1. When completed,
2. Click Save.
A blank Edit Supplier Accounts screen will appear for capturing the next supplier (Samsung).
75
Figure 5.2 The Edit Suppliers Screen
CONCLUSION
• Supplier categories are optional and are used to group suppliers into areas, types of
products.
• Should you wish to make use of this option, it is important that these categories are set up
first, prior to creating supplier accounts so that when you create the supplier accounts, you
can link them up to these categories.
• Supplier categories are useful for reporting purposes.
76
4.6 WEEK 6: CREATE AND MAINTAIN CUSTOMERS ACCOUNTS
Create and maintain supplier accounts

Purpose
• Create and maintain Customer accounts

• Create and maintain Sales Analysis Codes
• Create cost codes.
Learning • Create and maintain customer categories
Outcomes • Change Default Settings in new accounts.
• Link customers to price lists
Time

Media
Prescribed
Reading
4.6.1 CREATING CUSTOMERS ACCOUNTS

Customers are the most important part of any business and the correct customer transactions should
reflect at all times.
There are Three types of customer Masterfiles that you can create:
• Customer Categories
• Sales Analysis Codes
• Customer Accounts
CREATING CUSTOMER CATEGORIES
77
You are able to create up to 99 categories for your customer accounts. You can link individual
customers to these categories. You can use these categories to sort your customers. For example, you
may want to sort your customers as local or national, or by product ranges.
You do not have to use customer categories, and you can start or stop using them at any time.
However, you cannot delete a customer category that has a customer account linked to it.
You create customers categories as follows:

From the Menu bar, Select Edit > Customer > Categories.
Type in the description of the customer category and click Ok.
CREATING SALES ANALYSIS CODES

This option allows you to analyse sales by salesperson, geographic areas, and marketing analysis. Using
this option is optional. Should the Sales Analysis Codes be used, the system can be set to force users
to enter sales codes on processing each sales document.
You create Sales analysis code as follows:

From the Menu bar, Select Edit > Customers > Sales Analysis Codes
• Sales Analysis Code - enter a code to identify the sales code in this field. Up to 5 characters
can be used to create these codes.
• Description – enter the name of the Sales Code here. If codes are used to represent sales
representatives enter the sales person’s name here.
• Blocked - if you want to block a certain sales code, select this tick this box
• Pay Commission On - indicate how commission is to be paid to the sales representatives, i.e.
on gross profit or sales
• Commission Structure Table – Specify target values and the commission percentages relating
to those targets reached. When entering the Periodic Target Amounts, always enter the
lowest a range. The system will automatically enter the Range as the target values are entered.
• The Copy / Paste Commission Structure allow you to copy and paste commission tables from
one Sales Rep. to another.
CREATING NEW CUSTOMER ACCOUNTS

You create a customer account as follows:
From the Menu bar, Select Edit > Customer > Accounts.
• Account Code - The recommended way of creating codes for customers accounts, is to use
the first three letters of the relating customers name as the first three characters of the code,
then use sequential numbers as the last three numbers of the code. This way coding is
consistent and searching by code or description is easy.
• Description – The description field can contain up to 40 characters. The customer name
should be entered here.
78
• Blocked – Should you not want to process any further invoices or sales to a customer’s
account, tick this box to block it.
Note: When a customer’s account is blocked, you cannot process any debit values to it, but
you can process receipts and credit notes to the account.
• Customer Category – by clicking the drop-down list, you can select a category from the list of
previously created categories.
The Contacts Tab

None of the fields on this tab is compulsory. It is however recommended that you enter as much
information as possible.
• Sales Code – Enter a default for the relating customer here. Sales codes can also be entered
with the processing of each sales invoice individually.
• Additional Delivery / Contact Details – Here you can set up additional delivery and contact
details for a customer.
The Processing Tab

• Currency Code – This option is available when the Multi Currency add-on module is being used
you can then select different currencies for different customers.
• Exclusive / Inclusive – Choose a default setting in respect of whether prices for a specific
customer should be entered as inclusive or exclusive of VAT.
• Default Tax – specifies whether VAT applies to the customer or not. If a customer is registered
for VAT, select the Default Tax option.
• Tax Code – Once the Default Tax Type has been selected, this option becomes available, and
the Tax Code can be selected.
• Tax Reference – Enter the customer’s VAT registration number here, if applicable.
• Default Contra Account – This is an optional field. If you purchase non-inventory items from
a supplier, you could set up a default general ledger account relating to the type of income
from the customer.
• Processing Method – When setting the customer’s defaults on the Customers Control, the
processing method was selected. This method can be changed here if a customer’s method
differentiate from your default setup.
Note - Once the Masterfile has been saved, this option will be greyed out and the only way
of changing it would be through the change option on the Menu bar.
79
• Terms – Enter the supplier specific terms here. (As discussed previously under Setup Customer
Control.) However any customer specific changes can be set here.
User Defined Fields Tab

This is an optional function and can also be setup globally under the Customer Control function. This
function allows you to display additional information about a customer.
Balances Tab
Once processing has taken place, accumulative balances and movement values will be displayed for
each period for both the current and previous financial years. This is a display only tab, and no amounts
can be entered here.
CUSTOMERS MASTER LISTINGS

You access the Customers master Listing in the following Way:
View > Customers > Listings > Accounts.
VARIOUS PRINT OPTIONS ARE AVAILABLE:

• Reports can be displayed on the screen
• You can select to print to different printers depending on the printers set up on the
computer you are using.
• Reports can be exported to different standard document formats such as
• Word
• Excel
• Text files
• PDF files
EXERCISE 6.1
Nozibini has the following Customer Categories:
1. Local
2. Export
3. Cash
Create these customer categories
Nozibini has asked for the following sales analysis code to be created.
Code: TM001
Description: Tumi Chaba
Pay commission on: Sales
Range R1 to R75 000: 5%
Range R75 001 to R155 000: 8%
Range R155 001 onwards: 10%
80
Once the Customer Categories and Sales Analysis Codes have been set up, the following Customer
Accounts must be created.
Code: MT001
Description: MTN
Sales Code: Tumi Chaba
Normal Terms: 60 days
Price List: Local
Credit limit: R450 000
Code: CE001
Description: Cell C
Sales Code: Tumi Chaba
Normal Terms: 30 days
Price List: Export
Credit limit: R500 000
Creating new customer Categories

1. From the menu bar select Edit>Customers>Categories The following screen displays: (Refer to
Figure 6.1)
2. Enter the Categories as required as per the exercise.
81
Figure 6.1 The Edit Customer Categories Screen
Creating new Sales Analysis codes

1. To create Sales Analysis Codes, select Edit > Customers > Sales Analysis Codes.
2. The Edit Sales Analysis Codes screen displays complete the fields with the information
supplied in the exercise (Refer to Figure 6.2)
82
Figure 6.2 The Edit Sales analysis Screen
3. Click the save icon and close the sales analysis code screen.
Note: The Copy / Paste Commission Structure allows you to copy and paste commission
tables from one Sales Rep. to another.
Creating new customer accounts

1. From the menu bar, select Edit Customer>Accounts. The following screen will display:
83
Figure 6.3 The Edit Customer Screen
2. Select the Details tab, capture the Sales Code Tumi Chaba
3. Select Processing tab. Ensure that Balance Forward Processing is selected.
4. Select the Terms tab, and capture details as shown: (Refer to Figure 6.4)
84
Figure 6.4 The Edit Customer Accounts-Terms Screen
5. Save, and create the customer account for Cell C as per the Exercise.
CONCLUSION
• When processing customers, a few things will automatically happen because of the settings
used when creating the customer accounts.
• When invoicing, the sales analysis code will automatically display on the invoice
• A commissions report will become available for printing on the sales analysis codes.
• When receiving customer payments, the system will be able to calculate the settlement
discount if it is due.
• Interest will be charged on overdue accounts, as set up on the customer account.
85
4.7 WEEK 7: CREATE AND MAINTAIN INVENTORY ITEMS
Create and maintain inventory groups and items

Purpose
• Create inventory categories

Learning • Create inventory items
Outcomes
Time

Media
Prescribed
Reading
4.7.1 CREATING INVENTORY ITEMS

It is important to have strict company policies in place when a company is stock / inventory driven.
Inventory groups control the integration of inventory items into the general ledger. That is why
inventory group contains general ledger accounts, which the system uses when purchasing or selling
an inventory item.
CREATING GROUPS
In order to ensure that the correct general ledger account is used when processing an inventory item,
general ledger accounts and sub accounts must be created and setup in inventory groups.
You can access inventory setup as follows:
From the Menu bar Select Setup > Inventory.
Configuration tab
Often employees are given authorisation to make decisions relating to sales and purchases, but only
within certain limits. Some of these limits are specified here in Pastel, so that the employees do not
overstep their authorisation.
86
The items listed in the processing block refer to computerised controls to help the business achieve
their profit goal.
• Allow Inventory Quantities to Fall Below Zero – If this option is selected you can sell inventory
items that are not on the shelf.
• Warn if inventory Falls Below Zero – If the first option was selected, this option becomes
available. When inventory does go into a negative quantity, the system will generate a
message.
• Sales Orders Reserve Inventory – If sales order documents are used, they would either be
linked to an invoice or deleted. But they can also be used to reserve inventory quantities. If
this option is selected, then Inventory items would not be available to sell to other customers.
• Sales Orders Reserve Serial Numbers – If the serial number tracking add-on module has been
added, the system can reserve serial numbers for specific inventory items.
• Check Reorder Level when Processing – The system can be set up with minimum quantities
of inventory to be held at any given time. When processing, and these levels falls below the
reorder level, the system will generate a warning message.
• Warn if Preferred Supplier Not Used – Inventory can be set up with preferred suppliers to use
for reordering. When ordering the system will give a warning if the preferred supplier is not
being used.
• Make Average Cost 0.00 when Zero on Hand – the average cost price will revert make to zero
when there are no more stock items on hand.
Integration/Groups tab
Currently the default inventory groups are Services and Inventory Goods. If you wish, you could set up
multiple groups and use different. If you can separate the sales and cost of sales of the various groups,
you can make better decisions. To create various groups you type the group names under the
description column.
However, Pastel will not automatically know how to link (integrate) the groups with the general ledger
so you can extract the information at a later stage. Therefore we will set up the integration here on
the Inventory integration/groups tab.
When you selected an industry specific chart of accounts during the creation of the new company on
Pastel, several standard general ledger accounts were created automatically. These include the
customer and supplier control accounts you have seen so far during auto setup, as well as the accounts
visible on the integration/groups tab of the inventory setup
Now unselect the integrate inventory to general ledger tick box and see how the general ledger
accounts are affected. Select the same tick box again to see the integrated general ledger accounts
again.
User Fields tab

These user defined fields are similar to those defined for customers and suppliers, i.e. it becomes the
field names in the inventory master file. E.g. you will be able to specify the name of each type of
87
inventory item for any business, but you might want to create a special field for ingredients in food
that may cause allergic reactions if your business sells food.
Other tab
The defaults for new items on the inventory setup other tab is similar to the default tabs for customer
control and supplier control in that it will use this information as the default for every new inventory
item you are going to create. If you decided to change the description or add more inventory groups
on the configuration tab, you’d be able to select it here in the inventory group dropdown list. The
encrypted cost price is a feature if you are going to print your own price labels and if you give some
flexibility to your sales staff for negotiating sales prices.
Create Inventory Categories

Inventory categories are used to group various inventory together so that various reports may be
produced in category sequence.
EXERCISE 7.1
Nozibini has asked for the following inventory categories to be created
1. Services
2. Goods
Create the following Inventory Items (All prices are VAT inclusive):
Code: PT321
Description: Polo Travel Bag
Unit: Each
Type: Physical Item
Cost Price: 900.00
Local Price: 1 750.00
Export Price: 1 550.00
Cash Price: 1 400.00
Code: PB945
Description: Police Black Sunglasses
Unit: Each
Type: Physical Item
Cost Price: 1 100.00
Local Price: 1 960.00
Export Price: 1 800.00
Cash Price: 1 680.00
Creating Inventory Categories

1. From the menu bar select Edit > Inventory> Inventory Categories. The Edit Inventory
Categories displays: (Refer to Figure 7.1)
88
Figure 7.1 The Edit Inventory Categories Screen
2. Create the Inventory categories as per the Exercise
Creating Inventory Categories

From the menu bar, select Edit > Inventory > Item File
3. The Edit Inventory screen displays: (Refer to Figure 7.2)
89
Figure 7.2 The Edit Inventory Item Screen
4. Enter the information as given in the Exercise starting with the Details tab:
5. Select the Prices tab, and the following screen displays: (Refer to Figure 7.3)
90
Figure 7.3 The Edit Inventory-Prices Screen
6. Enter the inclusive selling prices as per the Exercise.
CONCLUSION
• The correct creation of inventory categories, if they are applicable, inserting cost prices in the
right field, as well as the various prices is very important to ensure seamless take-on of
balances as well as processing transactions.
91
4.8 WEEK 8: TAKE ON BALANCES AND JOURNALS
This week we will learn:
How to capture take on balances

Purpose
• Process and understand general journal processing

• Take on balances in the middle of a financial year
• Make a system backup
Learning • Update batches processed
Outcomes • Print a trial balance, customer and supplier age analysis and
inventory valuation report
Time

Media
Prescribed
Reading
4.8.1 TAKE ON BALANCES AND JOURNALS

THE BOOKKEEPING CYCLE
The steps below are followed on a monthly basis.
Transaction takes place
Source documents summarise transactions
The general ledger summarises the journals
The trial balance summarises the general ledger
92
INTRODUCTION
Most companies start as small businesses and they will not have enough capital to initially
computerize their bookkeeping thereby make use of the manual system. When the company grows
and it can now afford to computerize its bookkeeping cycle, it will have balances in its bookkeeping
such as balances for debtors, creditors, PPE etc. These balances need to be put as opening balances
when introducing the computerized bookkeeping.
TAKING ON BALANCES IN THE MIDDLE OF THE FINANCIAL YEAR

When bringing in opening balances into Pastel, the following will be required:
• Trial Balance If you are processing opening balances as at the last day of the previous
financial year, only the Balance Sheet entries are required. Ensure that the This Year
Transactions option in settings menu is NOT ticked so that the batch relates to the previous
year. The retained income balance will need to be included to take the Income Statement
profit loss account. If you are processing opening balances in the current financial year.
both the Income Statement and Balance Sheet balances are required and transactions will
be posted This Year Transactions. No current profit/loss values will be processed. However,
an accumulative retained income/loss balance relating to previous years, this would be
brought in.
• Customer Age Analysis
• Supplier Age Analysis
• Inventory Valuation – if the company is stock driven.
To successfully bring in opening balances, you’d need to add some new general ledger accounts, and
change some of the descriptions of the current ledger accounts to match the Trial Balance account
descriptions. When processing take-on balances for:
• Cashbooks – i.e Bank, Petty Cash and Credit Card,
• Suppliers control account,
• Customers control account, and
• Inventory control account, it is impractical for various reasons to capture directly into the
said accounts.
• General Ledger
Thus, create suspense sub accounts (under the main Account – 9990/000: Opening Balance /
Suspense Account) for all five accounts
Once all five Suspense Accounts (for Cashbooks, Customers, Suppliers and Inventory) are created,
you are ready to capture the Take-on Balances.
Take on Balances: step by step

Step 1: Ensure the old trial balance balances and the subsidiary ledgers agree with this trial balance
Step 2: Create the new company on Pastel (using one of the three methods available)
Step 3: Ensure the trial balance accounts in Pastel exist and that the descriptions are correct (else
edit the general ledger accounts)
93
Step 4: Create the customer accounts, supplier accounts and inventory accounts for the business’
existing customers, suppliers and inventory items
Step 5: Create the four (or five) sub-accounts of the Opening Balances suspense account
Step 6: Make a ‘before take on’ backup
Step 7: Trial balance balances:
• Capture and update the take on for the trial balance balances into the new company’s
general journal (using all the relevant sub-accounts of the Opening Balances suspense
account for bank, customers, suppliers and inventory)
• View the trial balance report to ensure you have correctly captured the trial balance
balances
• Make an ‘after trial balance take on’ backup
Step 8: Customer balances:
• Capture and update the take on for the customer balances into the new company’s
customer journal (using the customer sub-account of the Opening Balances suspense
account as the contra account)
• View the customer age analysis report and the customer detailed ledger report to ensure
you have correctly captured the customer balances
• Make an ‘after customer take on’ backup
Step 9: Supplier balances:
• Capture and update the take on for the supplier balances into the new company’s supplier
journal (using the supplier sub-account of the Opening Balances suspense account as the
contra account)
• View the supplier age analysis report and the supplier detailed ledger report to ensure you
have correctly captured the supplier balances
• Make an ‘after supplier take on’ backup
Step 10: Inventory balances:
• Capture and update the take on for the inventory balances into the new company’s
inventory journal (using the inventory sub-account of the Opening Balances suspense
account as the contra account)
• View the inventory valuation report to ensure you have correctly captured the inventory
balances
• Make an ‘after inventory take on’ backup
Step 11: Cash book balances:
• Capture and update the take on for the cash book balances into the new company’s relevant
payment OR receipt cash books (using the general ledger sub-account of the Opening
Balances suspense account as the contra account, but preferably the cash book sub-account
of the Opening Balances suspense account)
• View the cash book details report to ensure you have correctly captured the cash book
balances
• Make an ‘after cash book take on’ backup.
Step 12: Bank reconciliation:
94
• Capture and update the outstanding cheques and receipts into the new company’s relevant
payment OR receipt cash books (using the bank account itself as the contra account) • View
the cash book details report to ensure you have correctly captured the outstanding cheques
and receipts (and that the closing bank balance is still the same as per the take on trial
balance!)
• Do an update the bank reconciliation of the bank opening balance.
• View the bank reconciliation report to ensure you have correctly captured the outstanding
cheques and receipts.
• Make an ‘after bank reconciliation take on’ backup.
EXERCISE 8.1
You are provided with following Trial Balance of Nozibini Beauty Creations. Capture the following
Take-on Balances
Trial Balance of Nozibini Beauty Creations as at 31 January 2019
Debit Credit
Share Capital R 257 000
Security Safes at cost R 10 000
Motor Vehicles at Cost R 40 000
Computer Equipment at Cost R 32 000
Inventory Control: 40 x Polo Travel Bags R 36 000
Bank: ABSA Bank R 151 000
Supplier: Sony R 112 000
Customer: Cell C R 100 000
Total R369 000 R369 000
To successfully bring in opening balances, you’d need to add some new general ledger accounts, and
change some of the descriptions of the current ledger accounts to match the Trial Balance account
descriptions.
1. From main menu, click Edit > General Ledger > Accounts, then search for the Share Capital.
The account is currently named Share Capital / Members Contribution. Amend the name by
deleting Members Contribution, and renaming it Share Capital. Save the changes.
2. Go to Edit > General Ledger > Accounts, click on Description, and search for Security Safes at
Cost. Type Security. The account does not exist, and therefore has to be created. On the Edit
General Ledger screen, click the Add icon, to create a new account. Allocate 6325 as the
95
Main Account Number and type Security Safes at Cost on the description field as shown:
Figure 8.1 The Edit General Ledger Accounts Screen
When processing take-on balances for:

• Cashbooks – i.e. Bank Petty Cash and Credit Card
• Suppliers control account
• Customers control account
• Inventory control account
• General Ledger (income and Expenses)
Suspense accounts are created.
Create suspense sub accounts (under the main Account – 9990/000: Opening Balance / Suspense
Account) for all five accounts
Once all four Suspense Accounts (for General Ledger, Cashbooks, Customers, Suppliers and
Inventory) are created, you are ready to capture the Take-on Balances.
1. From the main menu bar, select Process > Journals. Double click on General Journal.
2. Click on the Settings button and select the options displayed: (Refer to Figure 8.2)
96
Figure 8.2 The Journal Settings Screen
3. Set the Contra Account for the specific journal you are creating, and untick tax processing.
4. Click on the Close button. The General Journal processing screen displays again. All
transactions will be either a debit / credit, and will be processed at date of Trial Balance, ie
31 January 2019. Remember to change the general ledger account to the relevant 9990
account when processing the following:
9990/010 Cashbooks – Bank Petty Cash
9990/020 Suppliers Control Account
9990/030 Customers Control Account
9990/040 Inventory Control Account
9990/050 General Journal
5. Enter the transaction for the first line of the Trial Balance, using GJNL001 as Reference and
Take-on Balance – January as the Description. Complete the exercise by entering all the
Opening Take-on Balances from the Trial Balance. (Refer to Figure 8.3)
Note: The journal should read In Balance at the bottom right corner of the screen, once all
balances have been entered as shown below:
97
Figure 8.3 The Process Journals Screen
The customer balance will be transferred from Suspense Sub Account into individual Customer
account:
1. From main menu, go to Process > Journals.
2. Then select Customer > Customer Journal
3. Click on Settings – make sure the option for Tax Processing is Not ticked and click Yes to
Increment Referencing.
4. Click Close. You’ll return to the Customer Journal screen. (Refer to Figure 8.4)
Hint: If all the columns, like Debit and Credit columns are not reflecting, click on the Batch
button at the bottom of the screen, then click Restore Columns.
Your completed line in the customer journal should be similar to the following screen: (Refer to
Figure 8.4)
Refer to Figure 8.4 The Customer Journal Process Screen
98
The Supplier Journal is a mirror image of the Customer Journal.
1. From main menu go to Process > Journals.
2. Then select Supplier, then select Supplier Journal.
3. Click on Settings – make sure the option for Tax Processing is Not ticked and click Yes to
Increment Referencing.
4. Click Close, to return to the Supplier Journal screen.
Your completed line in the Suppliers journal should be similar to the following screen: (Refer to
Figure 8.5)
Figure 8.5 The Suppliers Processing Journal Screen
Processing the Cashbook journal.

1. Click Process > Cashbook > Process Cashbooks The following screen will appear: (Refer to
Figure 8.6)
Figure 8.6 The Cashbook Processing Screen
2. By clicking on the Cash Book drop down arrow, you will be able to select the Cash book to
process (either ABSA Bank, or Petty Cash you created).
3. On the Payments screen, the Bank will be Credited and on the Receipt screen, the Bank will
be Debited.
99
4. GCS refers to the account relating to the transaction. G – for General Ledger, C – for
Customer Ledger and S for Supplier Ledger.
5. To select the account type, click in the column under GCS, then select your option. Enter the
amount as per the Exercise.
Processing the Inventory Journal.

1. From the menu bar, select Process > Inventory Journal. The Inventory Journal screen will
display: (Refer to Figure 8.7)
Figure 8.7 The Inventory Journal Screen
Once all columns have been captured, the screen should be like the one in Figure 8.8.
2. Click on Close. All the Take-on Journals are now complete.
Figure 8.8 The Inventory Journal Completed
At this stage, no entries have been posted into the system as all the Journals we created are
currently Open Batches. Open Batches do not affect the books and will need to be Updated for the
system to be able to generate reports containing the relating transaction detail.
100
BACKUPS
Before updating the journals and cash book batches processed, it is recommended to first make a
backup. Backups make a copy of all the data of the company as it currently stands. In case there are
errors in the batches to be updated, the backup can always be restored, and the errors corrected.
Another advantage for regular backup is to avoid loss or damage of data due to hardware failure,
power interruptions and theft.
Creating a Backup
1. In the Pastel Nozibini Beauty Creations, go to File > Backup. File Backup screen displays:
Figure 8.9 The Backup Screen
2. Select the Backup destination in Where to Backup to by clicking on C folder – if you are using
USB, ensure it is inserted in the USB portal; if on C drive, then Click New Folder and Name it
Backup.
3. Click on the Create button, then click Process.
4. Once Backup is complete click on Close.
Updating Batches
1. You are now ready to update the journals previously processed with the secure knowledge
that if an error was made, you have made a backup.
2. From the menu bar, select View > Open Batches. The following screen will show: (Refer to
Figure 8.10)
101
Figure 8.10 The Open Batches Screen
3. Click on the first blue tick under user Tunzi, the Jump To button will be activated.
4. Click on the Jump To button.
5. The Process Cashbook – Receipts will display.
6. Click on Update button and Update the Receipts Batch.
7. Select Close. This will take you back to the Open Batches screen, and you can now update
the next Batch.
Printing various reports

1. From the menu bar, select View > General Ledger > Financial Reports > Trial Balance.
2. The Printer screen option displays. Make the same selections as displayed (Refer to Figure
8.11)
3. Click OK.
102
Figure 8.11 The Print report Screen
The printed report should match the manual Trial Balance, as shown (Refer to Figure 8.12)
Figure 8.12 The Printed Trial Balance Report
Conclusion
• When Pastel generates the Trial Balance, a net profit / loss account is generated.
• When viewing or printing a Trial Balance, you have the option to either print the Income
Statement information or the Balance Sheet information at the top.
103
4.9 WEEK 9: SUPPLIERS PROCESSING
How to process suppliers

Purpose
• Create a purchase order

• Create and link a supplier invoice
Learning • Create a supplier invoice for non-inventory items
Outcomes • Create return and debit notes. Update batches
Time

Media
Prescribed
Reading
4.9.1 SUPPLIERS PROCESSING

When processing supplier documents and there is inventory involved, the only way to bring the
stock in is either through a Goods Received Note (GRN) or a Supplier Invoice. If the system was set
up to use GRN’s then stock must be brought in through GRN and when the Supplier Invoice arrives a
Supplier Invoice must then be generated through the system linking the GRN to the Supplier Invoice.
The following Suppliers documents are available on the Pastel system.

Purchase Order – When stock must be purchased it is good practice to issue a Purchase Order. This
document:
• Does not update your system
• Must be either linked to a Suppliers Invoice or deleted in order to be taken off the system
• Can be used for both inventory and non-inventory items.
Suppliers Invoice – When a supplier delivers stock it is necessary to create a Suppliers Invoice. This
Document:
• Can be Linked to a Purchase Order
• Can be updated (Make changes to your system)
• Can be used for Inventory and non-inventory items
104
Return and Debit – This document is used when stock needs to be returned to be returned to a
Supplier. This document:
Can be linked to the original Suppliers Invoice generated by the system on the following
conditions:
• The Supplier was set up for Open Item Processing
• The Suppliers Invoice has been updated
• The Supplier has not already been paid for the Invoice that the goods are being returned on.
Credit to Supplier – This document behaves the same way as a Supplier Invoice and could be used to
bring in stock items that was omitted from the original Invoice
To Access the Purchase Order:

From the Menu Bar Select Process > Suppliers and Purchase Order from the Document Type Drop
down list.
Linking a Suppliers Invoice to a Purchase Order

If you are still in the Purchase Order, Click on the drop down arrow under the Document Type option
and select Suppliers Invoice.
If you have closed the Purchase Order, Select Process > Suppliers from the Menu Bar and Select
Suppliers Invoice.
1. In the Suppliers field enter the Suppliers code of the Purchase order you want to link.
2. The system will advise you that you have outstanding Purchase Orders for the selected
supplier, and wants to know if you want to link it to the Suppliers Invoice. Select Yes.
3. Press Enter twice.
4. In the Number field, select the Purchase Order you want to link to the Suppliers Invoice. This
will pull the Purchase order Number through.
5. Press Enter to pull the Purchase Order through to the linking document.
6. At the bottom of the screen select Link. The “Link to Purcase Order “window appears.
• Leave the original document in place - the original Purchase Order which was
linked to the Suppliers Invoice will remain on the system. When certain Inventory
Reports are printed, it will reflect that there are still outstanding Purchase Orders.
• Delete only used lines from the original document – If only some of the stock was
received the system will remove only the items that were used on the Purchase
Order, and keep the items that were not received for linking when the supplier
sends the outstanding items through.
• Remove the whole original document – The complete purchase order will be
removed from the system.
7. Select all the items that were received and select OK
8. Enter the correct date, period and Suppliers invoice number and check invoice total. And
click next.
Return and Debit

The Return and Debit allows Inventory to be returned to a Supplier and the system will generate a
debit to the suppliers account.
105
1. From the Menu bar select process Suppliers and from the Document Type, select Return and
Debit.
2. Select the correct period and date and tab to the Suppliers Reference field.
3. Select the correct document number.
4. The document number selected pulls through the original invoice field. The irem that needs
to be returned still needs to be entered together with the quantity and cost price of the
item.
5. Select the Link/Create button.
6. Press Enter twice. The Invoices generated for this supplier is displayed.
7. Doble click on the invoice for which stock must be returned.
8. Press Enter again to pull through the actual document into the Link document.
9. Change the quantities to be returned.
10. Once the changes has been completed click on the Link Button.
EXERCISE 9.1
On 4 February 2019, Nozibini requests you to place an order with Sony for the items shown below:
(VAT applies to all transactions, and all documents are to be entered in exclusive mode).
Purchase Orders
90 x Police Black Sunglasses @ R1,100 each
70 x Polo Travel Bag @ R900 each
Learning Example 9.2
Suppliers Invoices
Process Supplier Invoices for both items ordered and link these to the purchase orders – As all items
were received (on 5 February), Remove the whole original document.
You were provided with a Sony Invoice Number – INVOA001
Supplier Invoice for a non-inventory item

On 28 February, Invoice No. INVMN151 from Paarl Local Municipality was received with following
payables:
Water and Lights (excl VAT @ 15%) R3 470.00
You are required to capture the invoice.
Return and Debit to a Supplier

You are required to process the appropriate document upon sending back the following inventory
item to the Supplier on the 11th of February:
Supplier: Sony
Supplier Invoice No: INVOA01
Item: Police Black Sunglasses
Quantity: 3
(Put a Remark on the document: Goods damaged).
Processing Purchase Orders

1. From the menu bar, select Process > Suppliers, Supplier Invoice will display.
106
2. In the Document Type field, click the drop-down arrow and select the Purchase Order
option. A Purchase Order document displays: (Refer to Figure 9.1)
Figure 9.1 The Process Supplier-Purchase Order Screen
Tip: Processing in Pastel is easier when using the keyboard. Either use the Tab key or press
the Enter key to move to the next field. Try and use the mouse only when absolutely necessary.
3. Tab/Enter to the Supplier field. Tab/ Enter once again in the Supplier field, the Supplier
Zoom will appear, then select Sony.
4. If the given prices were inclusive, you would tick in the Inclusive box. As the given prices are
exclusive, leave the Inclusive box unticked.
5. Tab to the Date field. Click on the drop-down arrow and set the date to 4 February 2019.
6. Tab to the Type column and click on the search icon. The following options will display:
Figure 9.2 The Type Column Dropdown List
107
7. Select 4 Item Code and tab to the next field (Code Field). Tab once again /Enter.
8. The Inventory Master File (Zoom) will display. Select the first item – Police Black Sunglasses.
9. Move to Quantity, and type 90.
Tip: Always tab to the next line after capturing details for the system to save the last line
captured – note the curser is on the 3rd line as displayed.
Your completed Purchase Order should look like one displayed below: (Refer to Figure 9.3)
Figure 9.3 The Completed Purchase Order
10. Once you are satisfied all details appear as above, click on Next Document.
11. It will take you to the Print option, press Cancel, as you are not printing.
Linking Invoices to a Purchase Order

1. Select Process > Suppliers, and in Document Type, select Supplier Invoice from the drop-
down Menu.
2. Tab to Supplier field, and press Enter.
3. Select your Supplier, Sony, and Enter.
4. When you tab to the next field, the following dialogue will display: (Refer to Figure 9.4)
108
Figure 9.4 The Outstanding Purchase Orders Dialog Box
5. Select No.
6. Click OK. (Refer to Figure 9.5)
Figure 9.5 The Warning date entered out of period Dialog Box
7. Select Period 12, then Enter date as 2019/02/05

8. Type INVOA001 in the Supplier Invoice No. field
9. Click the Link / Create button. The following screen will display: (Refer to Figure 9.6)
Figure 9.6 The Link Purchase Order Screen
10. Tab twice, and the following screen will appear: (Refer to Figure 9.7)
109
Figure 9.7 The Purchase Order Zoom Screen
11. Select Sony, Enter and tab, the following screen will display: (Refer to Figure 9.8)
Figure 9.8 The Select Items Ordered Screen
12. As full ordered quantities were received for both items, ensure they are both ticked in the
Selected column.
13. Then click on Link.
The following screen will display: (Refer to Figure 9.9)
110
Figure 9.9 The Document options: Leave in Place, Delete or Remove Dialog Box
14. Click on Remove the whole original document, then click OK.
15. Click on Next Document. Once again, Cancel the option to print.
Creating a Supplier Invoice for a non-inventory item

1. As this is a new supplier, from the Supplier Invoice page, select Supplier > Modify > Edit
Supplier Or, from Main menu, select Edit > Supplier > Accounts.
2. Click the Add icon and complete the Supplier details.
Your Supplier Account Processing screen should be similar to the displayed: (Refer to Figure 9.10)
Figure 9.10 The Completed Edit Supplier Account Screen
111
3. Once the Paarl Local Municipality Account is selected, tab to date and select 28 February
2019
4. Type INVMN151 in the Supplier Invoice No. field.
5. Tab to Type, and select 6 GL Code
6. In the Code field, search for Electricity and Water Account 3650, and Enter.
7. Your completed Invoice should be similar to the one displayed (Refer to Figure 9.11)
Figure 9.11 The Completed Non-Inventory Screen
8. Click on Next Document.
Updating Batches
Batches which have not been updated, are still not taken into the system, and therefore, the items
which have been purchased will not be available for sale yet.
1. From the menu bar select View > Open Batches.
2. Click on the blue tick under User Name The Jump To button turns blue,
3. Click on the Jump To button.
4. Click on Batch, at the bottom of the screen The following dialogue displays: (Refer to Figure
9.12)
112
Figure 9.12 The document not yet printed Dialog Box
5. Select No.
6. Then Click Update. and Close, you will be back to View Open Batches. Close it as well.
Return and Debit to a Supplier

1. From menu, select Process > Suppliers,
2. From Document Type select Return & Debit.
3. Select Sony in the Supplier field.
4. Tab to Date, and select 11 February 2019
5. In Original Invoice field, type INVOA01
6. Tab to Type, and select Item Type
7. In Code, select Police Black Sunglasses.
8. In Quantity type 38.
9. Then tab to next line, in Type the amount select Remarks type Goods damaged.
10. The document should look as follows: (Refer to Figure 9.13)
Figure 9.13 The Completed Return and Debit Screen
113
11. Click on Next Document.
12. Click on Batch and Update the Batch.
CONCLUSION
• Purchase Order never updates into the system and does not affect balances or quantities.
Supplier Invoice and Return and Debit must be updated to affect balances and quantities.
• The General Ledger is automatically updated.
• The Trial Balance is automatically created.
• If a supplier invoice is not required for inventory items, a supplier journal can be used to
bring the general ledger transaction item into the set of books.
• For expenses that occur on a monthly basis, such as telephone, rent, etc. these can be
posted directly through to the relevant general ledger accounts through the Cash Book when
payment is made.
114
4.10 WEEK 10: CUSTOMER PROCESSING
How to process customer accounts

Purpose
• Process a customer’s quotation

• Link a quotation to a customer’s sales order
Learning • Link a sales order to a customer invoice
Outcomes • Create a cash customer account
• Create customer’s credit note
Time

Media
Prescribed
Reading
4.10.1 CUSTOMER PROCESSING

Every customer’s invoice generated in a computerised system must go into a customer’s account,
even if the customer does not enjoy terms with the company e.g., cash customers. Should there be
invoice generated for cash customers, it is advisable to create an account specifically for all cash
customers. If this is set up correctly, the cash customer’s details can appear on the invoice, together
with their VAT number iro SARS requirements.
CUSTOMER DOCUMENTS
The following customers documents are available on Pastel:
• Quotation – This document provides estimates or quotes on specific prices of goods or
services that a customer might be interested in. The quotation does not get updated.it can
be linked to a customer Invoice.
• Sales Order – A Sales Order will be processed prior to a customer invoice and can be linked
to a customer invoice or quotation. The Sales Order’s Name can be changed to Pro Forma
Invoice. In some industries payment is required prior to the delivery of goods and the
customer will not pay unless an invoice has been issued. On the other hand, the company
supplying the goods might only want to issue an invoice once the transaction is secured.
115
Therefore, by changing the Sales Order’s name to Pro Forma invoice, the customer will still
receive an invoice. Yet, when the transaction does not follow through, the pro forma invoice
can simply be deleted without affecting quantities and values in the system.
• Tax Invoice – When goods and/or services are supplied to a customer, a tax invoice needs to
be issued. This document has to be updated and will the affect inventory quantities and
values on the Income Statement and Balance Sheet.
• Credit Note – This document is issued when a customer return inventory goods. A credit
note can be linked to an original tax invoice on the following conditions:
• The customer was set up for Open Item processing
• The customer invoice has been updated.
• The customer has not yet paid for the goods being returned and therefore
payment has not been linked to the invoice.
• Debit Note – This document has the same impact as a customer invoice and can be used to
bring in additional costs that might have been left off the original invoice.
PROCESSING CASH SALES

In a manual bookkeeping system cash invoices will be entered directly into the cashbook receipts. In
a computerised bookkeeping system, the process is different, as inventory can only be accounted for
through the processing of a sales order and the issuing of a tax invoice linked to a customer. This
means that a temporary debtor called Cash customer has to be created and debited first and then
immediately cleared in the cashbook receipts.
EXERCISE 10.1
On the 11th February 2019, the following customers requested quotations on the specified goods.
Process Quotations
MTN requested a quote on:
12 x Police Black Sunglasses
15 x Polo Travel Bags
both at Local Prices.
Cell C asked for a quote on:

48 x Police Black Sunglasses
24 x Polo Travel Bags
both at Export Prices.
Processing Customer Tax Invoices

Both MTN and Cell C accepted the above Quotations in full on the 13th and 14th February
respectively. In such instances, when processing the Tax Invoice, linking of the Quotations will be
prompted. You are required to leave the original documents in place after linking.
Process a Tax Invoice dated 15 February for a new Cash Customer, Telkom, with the following
details:
Address: 56 Main Street, Nebo, 1740
VAT Reg. No.: 4650249870
116
Processing Method: Balance Forward, as recommended for Cash Customers.
Sales Code: Tumi Chaba.
Price List: Cash
Statements printing: Not Required for Cash Customers.
Normal Terms: Current
Items bought: 9 x Police Black Sunglasses, and 14 x Polo Travel Bags.
Processing quotations
1. From the menu bar, select Process > Customers.
2. In the Document Type field, select the Quotation option.
3. Tab to the Customer field and select MTN.
4. Tab to the Date field and select 11 February 2019
5. Tab to the Code field and select the Inventory Code for Police Black Sunglasses
6. In Quantity, enter 12
7. Tab to the next line, and complete the Polo Travel Bag details, then tab to the next line to
ensure the Polo line is saved.
Your completed Quotation for MTN should look like the one displayed (Refer to Figure 10.1)
Figure 10.1 The completed Quotation
8. Click on Next Document and create Quotation for Cell C.
Processing Tax Invoices

1. If you are still in the Customer Quotation screen, open Document Type drop down, and
select Tax Invoice. Otherwise, from main menu, select Process > Customers.
2. Tab to Customer field, and select MTN.
3. As you tab to next field, it will prompt the dialogue: (Refer to Figure 10.2)
117
Figure 10.2 The Outstanding Quotation Dialog Box
If you click on Yes and the date of the document was not correct, after linking the document you try
and change the date /period, you will get this warning dialogue: (Refer to Figure 10.3)
Figure 10.3 The Change Period Warning Dialog Box
4. In order to correct the Period and Date first, click on No.

5. Change the Period to 12, and the Date to 13 February 2019.
6. Click on the Link / Create button at the top of the screen, and the Link to Quotation displays:
Figure 10.4 The Link Quotation Screen
7. Press Enter, and it will prompt a Quotation Zoom, were you will select the correct Quotation
to Link, and Enter or simply double click on the correct Quotation.
8. You will now be back to Document Type – Link to Quotation. Press Enter / Tab, and the
Quoted items will appear.
118
9. Confirm the items to be invoiced, and Quantity to be Used, by ticking in the Selected
column.
10. Click on Link. The following dialogue will display: (Refer to Figure 10.5)
Figure 10.5 The Link Quotation Leave in Place, Delete or Remove Dialog Box
11. Select Leave the original document in place, and click OK. You will now be on the Tax Invoice
screen.
12. Once you have ensured that all details are correct, click on Next Document.
Process a Tax Invoice dated 15 February for a new Cash Customer.

1. From main menu, select Edit > Customer > Accounts.
2. Capture the Details tab as shown: (Refer to Figure 10.6)
119
Figure 10.6 The Completed New Customer Account Screen
3. On the Processing tab select Balance Forward. The Terms screen should be as follows: (Refer
to Figure 10.6)
120
Figure 10.6 The Completed Edit Customer-Terms Screen
3. Click Save,
4. Capture the Tax Invoice as per the Exercise: (Refer to Figure 10.7)
Figure 10.7 The Completed Tax Invoice
121
5. Click Next Document, and, in line with the Tax Prompt Amount of R3 000 you captured in the
Setup Company Parameters, customer Tax Information will be required – fill the details as
shown below: Refer to Figure 10.8)
Figure 10.8 The Required Tax Information Screen
6. Click on OK, then cancel the printing instruction.

7. Update the Invoice batch.
CONCLUSION
• Customer Quotation and Sales Order never update into the system, and does not affect any
balances or quantities.
• Tax Invoice and Credit Notes must be updated to impact balances and quantities.
• The general ledger and customer ledger will be automatically updated when customer
documents are updated.
• The Trial Balance is automatically generated and updated.
122
4.11 WEEK 11: CASH BOOK PROCESSING
How to process customer accounts

Purpose
• Process a customer’s quotation

• Link a quotation to a customer’s sales order
Learning • Link a sales order to a customer invoice
Outcomes • Create a cash customer account
• Create customer’s credit note
Time

Media
Prescribed
Reading
4.11.1 CASH BOOK PROCESSING

The Cash Book is very important as everything will eventually be processed through it, as payments
will be made to suppliers and payments will be received from customers. Each side of the cash book
will have its own Settings button, as processing requirements are usually different for payments and
receipts.
When entering a transaction directly into a journal, it is very important to always make sure that:
• you are using the correct journal.
• you are using the correct bank account.
• you are on the correct tab (payments/receipts).
• your settings are correct
The journals you will use are the cash payment journal and the cash receipt journal.
To Access the Cashbook journals:

From the Menu bar select Process> Casbook.
123
Cash book data entry fields - detail
• Period – Period in which the transaction must be recorded for accounting purposes – the
periods available in the drop-down box depend on the number of periods you created during
setup. The period is linked to the date (or vice versa) depending on your setup (can you
remember where?). Accounting requires transactions to be recorded in the correct
accounting period.
• Transaction date – it is critical to process transactions on the correct date. Not the date
when you capture the transactions, but the date risk was transferred. Be careful when
capturing your transactions – e.g. wrong dates for goods received notes may result in your
inventory records being incorrect and then you will not be able to sell the items as required.
• GCS – your selection in this column will determine the selection available in the Account
field. G is for general ledger account, C is for customer and S is for supplier.
• Account – the drop-down lists depends on your GCS selection.
• Reference – you will type the unique number of your source document in here Note that
Pastel will combine all line items with the same reference number for bank reconciliation
purposes. This will enable you to split a transaction and book it to different general ledger
accounts to ensure your classification audit objective is met, and will lead to better
management control when analysing the information. E.g. your municipality account will be
paid with one cheque, but you may decide to split the cheque and book the relevant parts to
separate general ledger accounts for electricity, water and rates.
• Description – this description will show in your detail cash book and general ledger
printouts and help you to remember what the expense/income was for. The more
descriptive your description is of the actual transaction, the better. If later you find
If you rely a lot on the descriptions to analyse your expenses or income, it may be time to
create additional subaccounts or separate general ledger accounts.
• Bank amount – your settings will determine whether you enter the amount including or
excluding VAT. The amount you actually paid (including VAT if VAT was applicable) will
display for the bank reconciliation.
• Tax – Make sure you know and can explain the following:
• What is VAT?
• How does it work?
• What is the difference between output VAT and input VAT?
• What is the difference between normal VAT (invoice-based VAT) and payment/cash based
VAT, when should which option be used and how are the two options treated differently for
accounting purposes?
Cash book options and buttons Cash book drop-down box:

• Some companies have 10 or more different bank accounts and almost all have at least one
bank account and petty cash. Step one should always be to confirm that you are entering
your transactions in the correct cash book, else you will have to retype your transactions or
worse – process cancellation entries if you have already updated your incorrect cash book
batch.
124
Batch type drop-down box:
• You can create cash book batches and save it, then at a later date update it (post dated
batches) or copy and reuse the cash book transactions every month or as needed (recurring
batches), or just type it in as needed for the current period (normal batch).
• Post-dated batches is very useful if you know you have little time at month end to finalise
your accounting entries and recurring batches saves a lot of time for journals that repeat
every month e.g. salaries, rent etc.
• Recurring batches are never updated as you will copy from them again and again into your
normal batches.
Delete button: This will delete the selected transaction line.
Match button: If the settings was not setup correctly to invoke open item processing, it can
manually be matched by clicking this button and then the screen to match payments/receipts with
the respective purchases/sales will open up.
Reconcile button: From an Auditing perspective it is recommended that this button is NEVER used.
Reconciliation should take place properly through the separate reconciliation function by a different
person from the one entering the cash book transactions.
Inc /Exc button: Although you can set the tax entry method as part of the cash book settings as
either including or excluding VAT, individual transactions might differ from the settings and if you
click this button it will allow the amounts to be entered different from the settings you chose.
Preview button: Every cash book and journal was created so that the debit and credit accounts were
already setup as usually required for this type of transaction, with the double entry taken to the
account you specify as the contra account.
• Click on the preview button to view the actual debits and credits as it will be saved in the
transaction file if you want to make sure Pastel did not assume too much or you did not
specify correctly.
Transfer button: Pastel has a complicated method to transfer money from one cash book to
another.
• You MUST use the transfer button when transferring money between different bank
accounts or if you draw cash to use as petty cash. Else the transfer will not be visible as part
of the bank/petty cash reconciliation
• If you do not use the transfer button, but record it as a ‘payment’ from the one cash book
and a receipt into the other cash book, you will have processed the transaction twice
Update button:
• Remember, if you use batch processing, you will capture transactions but it will not reflect
in your reports or general ledger before you update it. The cash book update button is what
you click to update your cash book batches.
Batch button:
• You use this button to sort your cash book transactions, copy from your recurring/post-
dated batches into your normal cash book batch, delete the whole batch or use the
remittance assistant
125
Settings button:
• Step two should always be to set the settings before entering your cash book transactions.
• Here you will set the contra account (for non-cash book journals), the processing options,
the reference options and the tax processing.
• These settings are what you will mostly use to make life easier when entering your
transaction. However, all the settings you chose can be changed during entering of the
transactions should you need to, by simply overtyping, or clicking the appropriate button.
EXERCISE 11.1
Process the following transactions which occurred during the month of February 2019 in the cash
book.
Receipts
Date Ref Receipts Details
11 Feb Dep 68 Received R50 000 as capital injection form owner, Nozibini.
15 Feb Dep 69 Received R34 719.98 iro the cash sale made to Telkom.
20 Feb Dep 70 MTN made part payment towards their account.
28 Feb Dep 71 Cell C made R120 000 towards their account.
Payments
Date Ref Payment Details
8 Feb Chq 70 Paid R4,640 (VAT incl.) to McCoy Mag for advertising.
25 Feb Chq 71 Paid Salaries & Wages for R16,000.
26 Feb Chq 72 Account payment of R120,000 to Sony.
28 Feb Chq 73 Paarl Local Municipality R3,990.50 (VAT incl.) for Water & Lights.
28 Feb Chq 74 Paid R2,320 (VAT incl.) to Telkom for the Telephone Landline.
1. To open the Cash Book, click on Process > Cash Book > Process Cash Books
2. Starting with the receipts, click on Receipt tab (in blue). The following screen displays: (Refer
to Figure 11.1)
126
Figure 11.1 The Completed Cashbook Receipts Journal
3. Open the Settings tab, and adjust the Tax Processing and Increment References Settings as
shown (Refer to Figure 11.2)
Figure 11.2 The Cashbook Settings Screen

4. Click on Close.
127
5. Capture the receipts as per the Exercise. Your completed screen should be as displayed
Figure 11.3 The Completed Cashbook Receipts Journal
At this stage, do not update the cash book until the Bank Reconciliation process is completed.
6. Click on the Payments tab.

7. Open the Settings tab, and select the following options: (Refer to Figure 11.4)
128
Figure 11.4 The Cash Book Journal Settings Screen
8. Close the Settings once the correct options are made.

9. Capture the payments as provided in the Exercise.
The completed screen should look as displayed : (Refer to Figure 11.5)
Figure 11.5 The Completed Cash Book Payment Journal
129
10. Close the cash book.
Once again, do not update the cash book until the Bank Reconciliation process is completed, as
additional transactions from the Bank Statement still need to be captured.
CONCLUSION
• When capturing transactions into the Cash Book, it is important to select the correct bank
account, if more than one bank account is used by the entity.
• Also, ensure that the settings are correctly set up, that is, the Tax is switched on or off as the
transaction applies.
130
4.12 WEEK 12: BANK RECONCILIATION
How to perform Bank Reconciliation

Purpose
• Process a bank reconciliation

Learning • Viewing, updating and printing reports
Outcomes
Time

Media
Prescribed
Reading
4.12.1 BANK RECONCILIATION

The bank reconciliation in a computerised accounting system is no different from that of a manual
one, as the bank statement transactions will be compared with cash book entries entered in the cash
book payments and receipt journals. Any transactions on the bank statement, e.g. Stop Orders, Bank
Charges, Direct Deposits etc. that have not been entered into the cash book will still have to be
entered. Any transactions entered into the cash book, that are not appearing on the bank
statement, e.g. Outstanding cheques / Deposits, Bank errors etc., will form part of the bank
reconciliation.
THE BANK RECONCILIATION PROCESS

All entries that have been entered into the cash book will automatically appear in the system’s bank
reconciliation, for both updated and open cash book batches. Were errors in the cash book journal
are picked up, e.g. R125 has been recorded wrongly as R152, changes in the cash book can then be
made prior to updating.
• Systematically match the transactions one by one in the cash book to the bank statement
• Those entries that cannot be found in the cash book which are on the bank statement should be
highlighted on the bank statement.
131
• Once all the transactions have been either marked off on the bank statement as being matched
to the cash book or highlighted as not found, the missing or unmatched transactions can be
investigated.
• The missing transactions that were highlighted must now be located and corrected, or entered
into the cash book.
• If the missing amount has been entered into the cash book, look at the following in order to
determine why the item could not be reconciled:
• The reference number used must be unique.
• If the transaction amount was entered incorrectly, then the amount should be changed to
the correct on
• If the transaction was duplicated, then the duplicated entry should be deleted from the
journal.
• If all of the above options have been checked and the bank reconciliation still does not
balance, check whether the correct closing balance of the bank statement was entered
correctly.
• If the Bank is in overdraft, a minus (-) symbol must be entered in front of the bank statement
amount.
EXERCISE 12.1
You are provided with the following bank statement. Reconcile your books with the bank records.
ABSA Bank statement from 1 February 2019 to 28 February 2019.
132
1. A scrutiny of the Bank Statement shows three amounts which do not appear in the cash
book payments. Capture these amounts on the payment side of the cash book as shown
R4,600
R670
R483
Figure 12.1 Captured Amounts appearing on Bank Statement.
2. Also, you would have noticed that the Direct Deposit by MTN has not been recorded in the
cash book – Enter it in the Receipts section of the cash book, as shown: (Refer to Figure 12.2)
Figure 12.2 Captured Amounts appearing on Bank Statement.
3. Now, whilst the cash book is still open, go to Process > Bank Reconciliation. The Bank
Reconciliation Assistant screen will appear as shown below: (Refer to Figure 12.3)
133
Figure 12.3 The Bank Reconciliation Screen
4. In the Statement Balance field, enter the closing balance reflected on the provided Bank
Statement, that is, R125,326.98
5. Click Next, and the following screen will display: (Refer to Figure 12.4)
Figure 12.4 The Bank Reconciliation-Selected Cashbook Screen
134
6. Type 483,00 in the Find by Amount field, and press Tab. Notice that the system will display
the same amount in the Amount to Reconcile field and also highlight the transaction in the
top half in blue.
7. Press Tab once again to confirm that the item has been reconciled. A tick will appear in the
Reconciled column, as displayed below: (Refer to Figure 12.5)
Figure 12.5 The Bank Reconciliation-Item Reconciled Screen
8. Type 670,00 in the Find By Amount field, the system will display a dialogue : (Refer to Figure
12.6)
Figure 12.6 The Amount Not Found Dialog Box
9. Click OK, untick the item, and proceed with the next amount. 11. Ensure that you scroll
down to process all 14 transactions.
Three transactions will remain Unreconciled (Chq No. 74, Chq 73 and Dep 71)
135
Figure 12.7 The In Balance Bank Reconciliation Screen
10. Notice that the system shows In Balance on the bottom left of the screen. (Refer to Figure
12.7)
11. As your Bank Reconciliation is In Balance, close it and Update the Cash Book, preferably the
Receipts Batch separately from the Payments Batch, i.e one at a time.
12. Open the Bank Reconciliation and Update it. The following screen will display: (Refer to
Figure 12.8)
136
Figure 12.8 The Updated Bank Reconciliation Screen
Take note that only the Unreconciled Items remain. These are the Outstanding Cheques
and Outstanding Deposit.
To view the Bank Reconciliation, select Options… Button above the Help tab, and select View
Reconciliation > OK. The following printout will display: (Refer to Figure 12.9)
137
Figure 12.9 The Bank Reconciliation Report
CONCLUSION
• The Bank Reconciliation statement ensures that the difference between the Bank Statement
and the Bank Account in the general ledger can be accounted for.
• There could be various reasons: Outstanding cheques, deposits, as well as direct deposits,
charges, unpaid items etc.
138
REFERENCES
Computerised Bookkeeping, Pastel Accounting Version 18, 8th Edition, Edge Learning Media
139

2023 Computerised Accounting Study Guide

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

2023 Computerised Accounting Study Guide

Uploaded by

Copyright:

Available Formats

Module:

2 Our Teaching and Learning Methodology

Effective teaching-learning approaches are supported by:

Shout Out | Example

3 Introduction to the Module

Welcome to Computerised Bookkeeping

3.1 Module Information

Weeks WEEKLY TOPICS FOR THE SEMESTER Reference

1 Installation and Registration of Pastel Partner Chapter 1

2 Pastel Language and Navigation Chapter 2

3 Creating and Setting up a Company in Pastel Partner Chapter 3

4 Create and Maintain General Ledger Accounts Chapter 4

5 Create and Maintain Suppliers Accounts Chapter 5

6 Create and Maintain Customers Accounts Chapter 6

7 Create and Maintain Inventory Items Chapter 7

8 Take on Balances Chapter 8

9 Supplier Processing Chapter 9

10 Customer Processing Chapter 10

11 Cashbook Processing Chapter 11

12 Bank Reconciliation Chapter 12

how to Install and Register Pastel Partner as an Educational Version, start

By the end of this week, you will be able to:

• Explain the minimum hardware requirements for installing pastel

Computerised Bookkeeping, Pastel Accounting Version 18, Edge Learning

4.1.1 HARDWARE REQUIREMENTS

4.1.2 INSTALLATION AND REGISTRATION OF PASTEL PARTNER

STARTING PASTEL PARTNER

REGISTRATION OF PASTEL PARTNER

Figure 1.1 Welcome to Pastel screen

Figure 1.2 Registration Type screen

3. Select “Single User/Server” Registration and click next.

Figure 1.4 Registration Assistant

4.1.3 DECIMAL SEPARATOR ERROR

TO RESOLVE THE DECIMAL SEPERATOR

4. Insure that the format is English

8. Set the time format as follows: (Refer to Figure 1.9)

• Pastel Language and navigation

By the end of this week, you will be able to:

• Relate standard bookkeeping terminology to terminology used in

Computerised Bookkeeping, Pastel Accounting Version 18, Edge Learning

4.2.1 PASTEL LANGUAGE AND NAVIGATION

DIFFERENCE BETWEEN MANUAL AND COMPUTERISED ACCOUNTING

COMPARISON BETWEEN MANUAL AND COMPUTERIZED ACCOUNTING

4.2.2 WORKING WITH THE DEMO AND NAVIGATING

Figure 2.1 Open Company Screen

6. Select the demo company and select Open

Figure 2.2 Demo Company Screen

For now, we are going to concentrate on the menu bar

The menu bar is as follows: (Refer to Figure 2.3)

Figure 2.3 The Menu Bar

FILE (Refer to Figure 2.4)

Figure 2.4 The File Menu

EDIT (Refer to Figure 2.5)

PROCESS (Refer to Figure 2.6)

VIEW (Refer to Figure 2.7)

CHANGE (Refer to Figure 2.8)

The Change Menu includes various miscellaneous functions.

SETUP (Refer to Figure 2.9)

UTILITY (Refer to Figure 2.10)

FAVOURITES (Refer to Figure 2.11)

Figure 2.10 The Utility Menu

HELP (Refer to Figure 2.12)

Figure 2.10 The Help Menu

Gathering all relevant information and creating a new company.