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Accounting Software Module Definitions

Enterprise and Mid-tier Accounting - Enterprise accounting systems refers to applications beyond just accounting (such as accounts payable, accounts receivable and general ledger)and the preparation of traditional financial statements. Enterprise systems is a term used since the late 1990's which refers to such business applications as customer relationship management (CRM) (including sales management and marketing), Business Intelligence to analyze data, document management/storage and electronic approvals, project management (for tracking costs and scheduling milestones for tasks and projects related to one overall project) and business alerts that tell you immediately if action needs to be taken to correct emerging problems such as budget overruns or scheduling slippages. e-Commerce can also be considered part of an ERP (Enterprise system). This is where either business to business or consumer to business transactions take place over the web for placing customer orders, checking order status or inventory availability and setting up and maintaining web-based catalogs.

In short it is movement toward realtime collection of data, more effective management reporting and a true paperless environment and one which facilitates the movement of essential data between departments and applications (know as integration) and minimizes duplicate entry making the entire enterprise both more efficient and effective.

General Ledger - A General Ledger module is the backbone of the accounting software package and must interface well with all its modules and accounting functions.   It maintains financial information in addition to budget information and transaction history; it imports information from other modules, and is the repository of accounting information from all other modules.

Thus, it is important that it has accessible and flexible databases to maintain all of this information.  Good GL modules work with Report Writing modules to produces traditional financial statements such as an Income Statement and Balance Sheets plus customized reports.
 

Accounts Payable – this module deals with the management of money  owed to creditors for goods and services. These are the unpaid bills of a business.  An accounts payable module should be able to produce reports, sorted by crucial criteria, such as vendor name, date, etc.

This module should provide access to balances for all accounts in order to maintain greater control over cash flow. It should have a search feature, query features, and easy interface with other files and accounting modules  to import  and export data automatically.

Accounts Receivable -  This module handles money owed to a company for products and services provided on credit, and is responsible for monitoring effective cash management. Accounts receivable is sometimes called “trades receivable” and is considered part of current assets. 

An accounts receivable module should track receivables, plan cash flow, deal with multiple bank accounts, and maintain audit trails. An Accounts Receivable should be able to integrate with General Ledger, Sales order, Inventory Control, Job Cost, and other modules.  Good reporting features for this module would provide for aging reports to help in the collection of unpaid invoices, among other reports.

Sales Order Entry – This accounting function/ accounting software module  is  part of the point of sale for businesses, and should allows employees processing a sales order to group all the details of the order in one place, as the orders are being placed: mailing address, shipping address, availability of inventory, item pricing, quantity pricing, costs, credit card information.

This module would integrate closely with other accounting modules such as: Job Order, Inventory Management, Accounts Receivable and Purchase Orders. A good sales order entry module would allow the user to process whole customer orders, from checking availability to initiating shipping, and entering tracking numbers for customer tracking. A reporting and query function for the module would also be critical.

Inventory Control –An inventory control module software deals with inventory management problems. It should be able to interact with invoice production, Sales and Purchase Control and Accounting.

An inventory control module must keep detailed information about the products, customers, inventory supplies,  sales, purchases, inventory stock and accounts . It should allow for producing reports so that employees can monitor the inventory –related indicators of your business.

Job Cost – A job costing module tracks in detail billings associated with each Job. A job costing module can interact with Accounts Payable, Accounts Receivable, Invoicing, Inventory Control, Payroll, Purchase Order and Estimating.

This module should be able to set up individual records for each job, and be able to set up multiple transactions for each job. Transactions should be able to be broken down by job phase. Job costing should be able to track both the dollar and time (hour) amounts associated with each job and job phase. Job costing should be able to be both queried and reported by different sorting and selection criteria.   A job cost module helps the user keep close tabs on job profitability. A good job cost module will often have sub-modules like Billing, Estimating, and Time and Materials.  A job cost module should be able to be integrated with General Ledger, Accounts Payable, Accounts Receivable, Purchase Order, and Inventory Control  modules among others

Purchase Orders – This function and /or module should manage the ordering of goods and services from vendors. A Purchase Order defines what needs to be ordered, and keeps track of what has been ordered and/or purchased.

It should also be able to generate electronic purchase orders directly selected by a user, or via predefined selected criteria from a database.  In order for this module to be effective, it should have an easily updatable database of cost items to draw upon.  A purchase order module should be able to issue requisitions, and follow them from inception to   delivery of goods and services to matching invoices to payments. Not every user needs functionality this broad, but a well integrated purchase order module should be able to perform all these functions.

Report Writing – a comprehensive report writer that allows you to define and determine custom and sometimes complicated reports is the way the accounting software communicates most often with the user. It should be able to import information and link different tables and databases from all of the accounting software modules.

Report writers should be able to create reports from templates, or on the fly; to format data and reports with flexibility; to sort and massage data according to the needs of the user. A good report writer will also be able to use formulas (both preprogrammed and customized) to perform calculations for reports; to import and export data from and to spreadsheet files; and to produce useful and attractive graphs from templates and via custom design.

Fixed Assets - Fixed Assets, also known as long-term assets, are the non-liquid assets that are required for the company's day-to-day operations. They include physical plant -- facilities, equipment, and real property (PP&E).  These are assets owned by a business for the purpose of producing goods or delivering services, rather than being held for resale. Sometimes fixed assets need to be reevaluated to assess the true value of the capital goods a business owns. Sometime companies overpay tax and insurance costs because they have not properly evaluated their fixed assets. 

Some accounting software packages provide comprehensive fixed assets solutions, or modules.  The best fixed assets modules are linked to the other major accounting software modules and offer flexible reporting features.

Payroll  - Payroll features are crucial to the accounting function of any company, big or small. A Payroll module needs to be able to track vacation, sick time, bonuses, flex time, overtime, garnishments, insurance deductions, taxes, and so many other human resources (HR) related factors.  

A Payroll function or module should be able to interface directly with the General Ledger (GL) module and functions.  As states begin to request electronic media reporting for payroll, payroll software needs to be able to generate electronic feeds exportable to other systems. Of course, a flexible and sophisticated report writing function is essential to a successful payroll application. 

Order Processing - Order processing is the ability to accept and enter customer orders for the items and quantities requested and to invoice them according to the price for that customer. Typically, once orders are entered, a shipping document is printed which is used to select the orders from a warehouse location, quantities shipped are verified and then invoiced. If less than the quantity requested is shipped, the balance may be backordered and then tracked by the system to be shipped when the item is available. Some most advanced order processing can involve receiving customer orders via EDI, bar codes scanning and "pick and pack" features. Order processing will integrate with other applications including accounts receivable, inventory control and CRM.