Finance Management

Finance Management in Highnix ERP: Streamline Your Accounting

Highnix ERP's Finance Management module is your comprehensive accounting solution, designed to seamlessly integrate with your business operations. It serves as the financial backbone of your organization, automating the recording and management of all your business transactions.

Automated Transaction Recording: Say goodbye to manual data entry. With Finance Management, all your business transactions are automatically captured and recorded. This not only reduces the risk of human error but also frees up valuable time for your finance team to focus on strategic financial tasks.

Multi-Currency Support: In today's global marketplace, dealing with multiple currencies is the norm. Our system excels at managing transactions in different currencies. It can effortlessly convert foreign currencies to your functional currency, allowing you to view transaction amounts side by side in the currency of your choice.

Real-time Exchange Rates: No need to hunt for exchange rates. Our system connects to the reputable and recognized source of the Monetary Authority of Singapore (MAS) to fetch the most up-to-date exchange rates. This ensures accuracy and reliability in currency conversion.

Effortless InvoiceNow Integration: We understand the importance of seamless B2B and B2G invoice transactions. That's why Finance Management includes the InvoiceNow feature, enabling electronic invoicing through Peppol E-invoice standards. This modern invoicing method not only saves time but also enhances efficiency and compliance.

Highnix ERP's Finance Management module empowers your organization with a robust, automated accounting system. It simplifies financial processes, enhances accuracy, and ensures compliance, allowing you to focus on growing your business without the burden of tedious financial tasks.

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Fixed Asset Management

Tag:#Fixed Asset Management

Why Does My System Not Having Asset Management?

The Asset Management feature is a valuable component offered as standard in our Plus package and above. If you currently do not have access to Asset Management, it may be because you are using a package below the Plus tier.

To benefit from the Asset Management functionality, you have two options:

1. Upgrade Your Package: If you are not already on the Plus or a higher-tier package, you can upgrade to one of these packages to gain access to Asset Management as part of the package features.
2. Purchase the Asset Management Add-On: If you are already on the Plus version of our software, you have the option to purchase the Asset Management add-on feature separately.

For more information on upgrading your package or adding Asset Management to your existing plan, please get in touch with our sales representative. They will be happy to provide you with details on the available options and assist you in selecting the most suitable solution for your needs.

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How Many Depreciation Methods Are Available In the Asset Management?

Asset Management offers two primary depreciation methods: Straight Line and Reducing Balance. These two methods are among the most widely used in financial and asset management practices.

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What Are the Differences Between the "Straight Line" and "Reducing Balance" Depreciation Methods?

The straight-line and reducing balance depreciation methods are two different ways of calculating the depreciation of an asset over its useful life. The straight-line method is the simplest method, and it involves depreciating the asset by the same amount each year. The reducing balance method is more complex, and it involves depreciating the asset by a larger amount in the early years of its useful life and a smaller amount in the later years.

The following table summarizes the key differences between the two methods:

Feature	Straight-line depreciation	Reducing balance depreciation
Formula	(Acquisition value - Residual value) / Useful life	(Acquisition value - Residual value) * Depreciation rate
Depreciation amount	Constant	Decreases each year
Tax benefits	Spread out evenly over the useful life	More concentrated in the early years
Suitable for assets	Assets with a constant useful life	Assets with a decreasing useful life

Here are some examples of how the two methods would be applied:

• Straight-line depreciation: A computer with an acquisition value of $1,750, a residual value of $20, and a useful life of 36 months would be depreciated at a rate of $48.06 per month.
• Reducing balance depreciation: A computer server with an acquisition value of $150,000, a residual value of $10,000, a useful life of 36 months, and a depreciation rate of 80% would be:
  • depreciated at a rate of $9333.33 per month in the first year,
  • $3111.11 per month in the second year, and
  • $622.22 per month in the third year.

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Can I Add Other Depreciation Method?

Ans: Yes, we can develop other methods for our customers upon request. Please contact our Sales Representative.

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How To Set Up Fixed Asset Management and Start Tracking Assets?

Tag: How To Setup Fixed Asset

Answer: Follow these simple steps to set up fixed asset management and start tracking your assets.

Steps to Set Up Fixed Asset Management

1. Set up asset accounts in your Chart of Accounts (COA):
   1. Create a "Fixed Asset" sub-group under the COA class "Asset."
   2. Group specific assets under "Fixed Asset Group" in the COA.
   3. Create a "Depreciation of Fixed Asset" sub-group under the "Expense" class.
   4. Set up the respective COA accounts for recording depreciation.
2. Add account codes to record:
   1. Depreciation (expenses)
   2. Accumulated depreciation (asset in balance sheet)
   3. Sales of assets (under Other Income)
3. Create items for fixed assets:
   1. Enter fixed asset details.
   2. Check the "Use As Asset" box in the form.

Best Practices for Fixed Asset Management

• Use a consistent naming convention for assets.
• Keep accurate records of purchase date, acquisition cost, and useful life.
• Categorize assets by type and location.
• Set up a depreciation schedule.
• Track annual depreciation expenses.

Asset Management Functions

Under the Asset Management Sub-tab, there are five key functions:

1. Asset Setup
2. Asset Depreciation Months
3. Asset Category
4. Asset Master
5. Depreciation Posting

Asset Setup

• Income Account for Fixed Asset Sale: Select an account under "Other Income."
• Loss Account for Fixed Asset Sale: Use the same account as "Income Account for Fixed Asset Sale."
• Acquired Initial Days Not to Depreciate in Same Month: Defines the number of days an asset must be owned before depreciation starts.
• Acquired Final Days Not to Depreciate in Same Month: Similar to the above but for month-end purchases.

Asset Depreciation Months

• Generates a monthly depreciation schedule for a Fiscal Year.
• If not generated, click "Add New."
• Select the Fiscal Year using the drop-down menu.
• If the Fiscal Year does not appear, create it under System Setup.

Asset Category

• Defines categories for assets (e.g., Vehicles, Machinery).
• Options include:

 * Asset Category Name
 * Depreciation Method: Choose "Straight Line" or "Reducing Balance."
 * Asset Life: Enter the useful life in months.
 * Asset Account: Assign an account under "Asset."
 * Depreciation Account: Assign an account under "Expense."
 * Accumulated Depreciation: Assign an asset account under Balance Sheet.

Asset Master

• Enter and manage asset details.
• Click "Depreciation Schedule" to view monthly depreciation.
• To sell an asset, click "Sale" and enter the sale details.

Depreciation Posting

• Streamlines the depreciation posting process.
• Steps:

 * Select an Asset Category or "All."
 * Select the Fiscal Year and month.
 * Click "Search."
 * Review assets that match the criteria.
 * Click "Post Depreciation" to finalize depreciation for unposted assets.

Example: Recording a New Machine for Lease or Rental

When purchasing a machine for leasing or renting, record it as an asset instead of inventory.

Key Concepts

• Assets vs. Inventory: Assets generate revenue over time, whereas inventory is sold in the normal course of business.

Accounting Treatment

1. Initial Recording:
   1. Record the machine as a fixed asset in the balance sheet.
   2. Include costs like shipping, installation, or setup in the asset’s value.
2. Revenue Recognition:
   1. Record rental income under revenue.
   2. Record maintenance or repair costs as operating expenses.

Best Practices

• Maintain detailed records for assets and liabilities.
• Regularly review assets for impairment or obsolescence.
• Ensure compliance with accounting standards.

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How to Delete a Fiscal Year in Highnix ERP

To delete a fiscal year, navigate to Setup > Fiscal Year. Before a fiscal year can be deleted, it must be closed. To close the fiscal year:

1. Click on the Edit button (pencil icon).
2. Select Yes in the Is Closed field.
3. Click on the Update button.

When the fiscal year is deleted, it will reduce database size and boost system performance. Highnix ERP can host up to 7 years of transaction records. However, enterprises in retail, F&B, eCommerce, etc., typically have very high transaction volumes. Such enterprises should review the need to delete old fiscal records that are no longer in use.

Backup Requirement

Before deleting a fiscal year, users must create a backup and note the date and time. The date and time can be seen from the backup file name. If your database size has reached the server's limit, you may need Highnix support to assist with the backup. If required, please contact our support team at Highnix Support.

Steps to Delete a Fiscal Year

1. Click on the X of the Fiscal Year intended for deletion.
2. All sales orders and details, up to the last date, that are fully delivered are removed. Attachments are removed.
3. All purchase orders and details, up to the last date, that are fully received are removed. Attachments are removed.
4. All GRN receivals, up to the last date, are removed.
5. All debtor transactions and details, up to the last date, that are fully allocated are removed. Attachments are removed.
6. All customer allocations, up to the last date, are removed.
7. All supplier transactions and details, up to the last date, that are fully allocated are removed. Attachments are removed.
8. All supplier allocations, up to the last date, are removed.
9. All work orders, up to the last date, are closed.
   1. All work order issues are removed. Attachments are removed.
   2. All work order manufacture records are removed.
   3. All work order requirements are removed.
   4. Work orders removed. Attachments are removed.
10. All stock movements, up to the last date, are removed and converted to a closing stock move.
11. All voided items, up to the last date, are removed.
12. All transaction tax details, up to the last date, are removed.
13. All exchange rates, up to the last date, are removed.
14. All customer and supplier sub-GL transactions are retrieved by account, removed, and an end transaction is inserted.
15. All bank transactions, up to the last date, are removed and converted to a closing balance transaction.
16. All audit trail records, up to the last date, are removed.
17. All comments, up to the last date, are removed.
18. Finally, the fiscal year is removed.

By following these steps, you can efficiently manage your database and maintain optimal system performance in Highnix ERP.

What If Something Goes Wrong?

1. After deleting the fiscal year, users must verify record integrity by checking the GL records, the Balance Sheet, and other financial reports to ensure data integrity is maintained.
2. If any issues arise, you can restore the backup file, and the data will be reverted to the state before the fiscal year was deleted.
3. if you need further help, please contact our support team at Highnix Support.