I am facing some problem in Branch Accounting the problem is that I do out sourcing job and this is the first time that I have come across like this situation.
I work in company who supplies frozen foods they have
3 Inland dependent Branches.
1 Foreign Branch.
At the moment I am using accounting software which is sage line 50
I have never done before Branch Accounting how can I make a relation
For example:
In the book of Head Office some transaction has happened which is
1-Purchased merchandise on account 90000
2-Remitted cash to the branch 45000
3-Shipped merchandise to branch at cost 54000
4-Paid the accounts payable of the branch 13500
5-Collected cash from branch account 13500
Now I want to know what would be the accounting treatment and which nominal ledger would be involved in this or will I have to open some ledger in my chart of account
as mentioned previously I am not an expert at Sage however, your other thread took you trough the basics of branch accouning in Sage so lets looks here more at general accounting principles than the software being used.
Consolidating branches is not really any different to consolidating wholly owned subsidiaries
The key is that inter branch profits and losses need to be eradicated on consolidation as they do not really exist.
As you work for an outsourcing company you should have an onsite accountant who will be able to talk you through what happens when the branches are consolidated and what needs to be eradicated on consolidation.
The subject is a little too big for an answer on a forum such as this but if you have access to the foolowing book then chapters 1 through 5 (first 217 pages) will give you a clear understanding of consolidations (be that branches or subsidiaries) :
These things will teach the accounting principles involved but getting your software to play ball is a whole different subject for which you need someone who uses Sage 50 for branch accounting (which I don't).
kind regards,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
