Thanks to both of you, but let me say that I have read the guides you mention and they do not, IMO, clearly explain how to set up individual accounts and their associated sub accounts in the Capital Accounts section.
And please let me also say that I must have somehow originally been in the Capital Accounts section. If I wasn’t, then how did I manage to locate the item named Capital Accounts which appears between the main heading Equity and the item named Retained Earnings?
And how did I then edit that item Capital Accounts so it became Member Balances. Which I achieved because I did learn how to do that in one of the guides.
Yes the guides “sort of” explain how to set up the headings for each partner or member. Not clearly enough for me.But that’s as far as they go.
I note that I have been practicing as a public accountant for 50 years. So I know what accounts and sub accounts are required. What I do not know is how to use and manipulate the Manager software to set up the accounts and sub accounts that I know are required.
Do I understand you to say that I need to set up something for each partner or member?
Frankly I am totally confused. With respect, you say that I am wrong and I accept that. But the guides just don’t explain things clearly enough for me.
Then, once I have my headings created ( whether these are groups, accounts, or something else entirely) I simply do not know.
You tell me that there is a difference between Capital Accounts and Ledger Accounts?
Not in any manual accounting system that I have ever seen. They are all part of the same recording process. Not in programs like MYOB or Quickbooks either, to my knowledge. So it must be unique to Manager?
So in what way are they different please? Please help me to understand. So can use Manager effectively.
Then I need to set up the various (let me call them) sub accounts to record the various elements that are transferred into each partner or member account. The guides do not seem to mention these at all. In fact I read that the partner or member accounts are only to show summary or total holding. Not the various elements.
Which is of no use to me at all. As I said, I need to show the individual elements to satisfy legal regulations.
Then I still need to know how to get the various ( let me call them) member accounts and sub accounts to appear in an order defined by me. Whether this is done by using codes? And if so, how?
You enabled the Capital Accounts tab after clicking Customize below the left navigation pane.
Yes, a capital account under the Capital Accounts tab, as explained in the Guide.
You seem fixated on creating headings. That is something that only applies when designing your chart of accounts. You can do what you need without creating any groups or new accounts under Chart of Accounts in Settings, where it seems you have done everything so far. The necessary Capital accounts control account is established automatically when you enable the Capital Accounts tab. Individual member’s subaccounts are subsidiary ledgers to Capital accounts, and must be created in the Capital Accounts tab, not in the Chart of Accounts.
In the program, yes. Capital accounts (as you are using the term) are subsidiary ledgers to the control account, Capital accounts. Ordinary ledger accounts are not subsidiary accounts. They include regular income and expense accounts and self-created balance sheet accounts that have no second-level components.
Well, Manager is not a manual system.
Yes, they do. Saying they do not suggests you are not reading the Guides you been linked to. And @lubos already explained how these subaccounts are represented in the Capital Accounts Summary.
These are displayed in alphanumeric order. If you don’t want them to be alphabetical, add a number to the beginning of each name.
But please let me observe that what I am referring to as headings are simply the names of the members. The names Justin Perry and Jenna Perry in the screenshot. They are not some weird fetish of mine. LOL.
You say that Capital Accounts is a control account and I now follow that it is. In Manager. But that the Chart of Accounts does not have control accounts.If I was a programmer I’d likely agree.
Since I’m an accountant, my view is that every group is a form of control account. It groups like accounts under a heading or name. Such as Current Assets or Expenses.
But that’s just me writing as an accountant and not as a programmer. Those I admire for their skills but who think differently ( perhaps computerspeak logically) to accountants.
Now my final comment re adding a digit to force the program to present in a specified order. This is precisely what I need to know. So thanks. Logical to a programmer’s mind but not to my accountant’s one.
Now I’ll go and revise everything I’ve done and fix things. Then report back.
Here is the thing. Neither MYOB nor Quickbooks have any support for capital accounts. The reason why you are confused is because you are trying to transfer your knowledge from MYOB/Quickbooks and apply it to Manager.
It will work but you are not getting the most out of Manager because Manager has specially designed module for Partnerships, Superannuation Funds and Trusts. MYOB or Quickbooks have no such a thing.
So… let me explain it step by step how you setup SMSF in Manager…
Start with empty business.
Who are the members of the fund?
You activate Capital Accounts tab and create these two members under Capital Accounts tab like this:
Then what are the sub-accounts of SMSF members?
Share of income
So go to Settings, then Capital subaccounts and add these 4 sub-accounts:
As you can see, you only create them once. You don’t repeat yourself for each member.
Then go to Chart of Accounts and rename Capital accounts to something more appropriate such as Members benefits
That’s it. Your setup is done.
Now you can set up starting balances and record transactions.
For example, when SMSF receives employer contribution from Jenna Perry, you go to record new receipt and categorize it into Members benefits → Jenna Perry → Employer contributions
When you make journal entry at the end of the year and want to allocate share of income and tax payable to each member, you again debit/credit Members benefits and then select member + their sub-account…
Then finally you want to print some report after all is done…
Go to Reports then Capital Accounts Summary and generate report for the period you need. Just make sure to rename the report to something more appropriate such as Members Information Statement.
As you can see, at no point, you are creating some convoluted structure in Chart of Accounts like you would on MYOB or Quickbooks. This is because Manager has specially designed module to manage balances of members, partners and beneficiaries. We call this module Capital Accounts. It allows easier setup, better reporting capabilities and easier data-entry.
I’ve now reread the guide 8936 on setting up capital accounts.
As I’ve indicated in my screenshot, I need to add extras such as Employee Contributions and Member Contributions etc. The guide does not mention them. Is there a guide that explains how to set them up in Capital Accounts? Or are they there by default?
My entity is a superannuation fund. It is not a partnership. Hence me using the term Member Balances. So the following extract from the guide 8936 is particularly relevant.
“But companies or corporations (terminology varies in different jurisdictions), trusts, and funds are separate legal entities. Depending on the legal structure of a business, it may be nessessary to change the classification of Capital accounts from Equity to Assets if they are debit balances or Liabilities if they are credit balances. When in doubt, consult with a local accountant to be sure.”
A fund does not have any form of capital as such. It only has member withdrawal balances. So am I better off showing those member withdrawal balances as long term liabilities rather than as capital accounts? As it seems that I have already unwittingly done.
This post is very useful. It should be added as guide example. It compliments the existing guides by giving a specific example / application. In contrast to the existing guides which describe the general module capabilities so while they are accurate, they are not as clear without knowledge if how the program is suppose to be used.
Concluding the example the above statement would also be useful together with links to the more generic guides +/- common customisations
Yes, it does. These are the subaccounts @lubos just illustrated. You can name or rename them to suit your needs. The Guide describes the default names for them, but you can choose anything that suits your circumstances and add as many others as you like.
You seem to be expecting the Guides to match your exact situation. Manager is used in hundreds off countries around the world, no two having exactly the same requirements. So it’s impossible to give examples corresponding to every single user’s setup.
No, you are not, because then you don’t have all the built-in capabilities. But if your legal structure is such that you want them to show as liabilities instead of equity, change the assignment of _Capital accounts_under Chart of Accounts in Settings.
It wasn’t my intention to make my request for advice into something as big as War & Peace. But your post tells me that detailed examples like mine are helpful to others. Which help I am pleased to offer, if inadvertently.
Lubos, Joe, Tut, and others have helped me greatly. For which I will be endlessly grateful.
I don’t know who the Moderators are here, but I second Patch’s post.