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.
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:
- 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.
- 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.
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.
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.
Can I Add Other Depreciation Method?
Ans: Yes, we can develop other methods for our customers upon request. Please contact our Sales Representative.
How To Setup Fixed Asset Management And To Start Tracking My Asset?
Ans: There are few simple steps to follow.
- There are a few simple steps you can follow to set up fixed asset management and start tracking your assets.
- Setup asset accounts in your chart of accounts (COA). This includes creating a "Fixed Asset" sub-group under the COA class "Asset" and grouping specific assets under the "Fixed Asset Group" in the COA. You should also create a "Depreciation of Fixed Asset" sub-group under the Expense Class and setup the respective COA for recording the depreciation of the fixed asset.
- Add account codes to record depreciation (expenses), accumulated depreciation (asset in balance sheet), and sales of asset (under Other Income which is under income class).
- Create items for fixed asset. This includes entering the fixed asset details and checking the "Use As Asset" box on the right side of the form. Once you have completed these steps, you will be able to track your assets and depreciation in your accounting system. Here are some additional tips for setting up fixed asset management:
- Use a consistent naming convention for your assets.
- Keep accurate records of the purchase date, acquisition cost, and useful life of each asset.
- Categorize your assets by type and location.
- Set up a depreciation schedule for each asset.
- Track the depreciation expense on your assets each year. By following these tips, you can ensure that your fixed asset management system is accurate and efficient
- Update
- Under the Asset Management Sub-tab, there are 5 functions namely: Asset Setup, Asset Deprecation Months, Asset Category, Assets Master and Depreciation Posting.
- Asset Setup:
- Income account for Fixed Asset Sale: Use the pull down menu to select the account code for sales of asset. The sale of asset should be an account created under "other income".
- Loss account for Fixed Asset Sale: Same account code as 'Income Account for Fixed Asset Sale' can be used. Together, it can record if it is a gain or a loss when an asset is sold.
- Acquired Initial days not to depreciate same month: This is the number of days in a month needs to be met when the asset is acquired before the system will start to compute the depreciation. For example, if the value of 10 is entered, and purchase date of asset is 15-Sep-17, then depreciation will be charged in next month i.e. October. If the asset is acquired within the first 10 days of the month, the depreciation will be charged in current month i.e Sep 2017.
- Acquired Final day not to depreciate same month: Similar to the above, if the value of 10 is entered, and the purchase date of asset is on 15 Sep 2017, the depreciation will be charged this month, Sep'2017. If the asset is acquired within the last 10 days of the month, then it will be charged the next month, that is Oct'2017.
- Asset Deprecation Months: This is to generate the months schedule for a Fiscal year. If it has not been generated, a "Add New" button will appear. Just click on the button.
- Fiscal Years: This is the Fiscal year that user wants to generate the monthly depreciation schedule. Use the pull down menu to select the Fiscal year. If a Fiscal does not appear on the pull down, the Fiscal Year can be created under System Setup. Once the "Add New" button is click and the months are created, there is nothing else need to be done here.
- Asset Category: This is to create the Asset Category. For example, motor vehicle.
- Asset Category: This is the name of the asset category to be created. For example, Vehicle.
- Depreciation Method: Use the pull-down menu to select either the "Straight Line" or "Reducing Balance Method".
- Asset Life: Enter the usable period of the asset in months.
- Asset Account: This is the Account under Asset. For example, 1850: "Motor Vehicle at Cost" where 1850 is the Motor Vehicle Asset account number.
- Depreciation Account: This is the Account under Expense. For example, 7050: "Depreciation - Motor Vehicle" where 7050 is the Depreciation - Motor Vehicle account number.
- Accumulated Depreciation: This is an Asset item in Balance Sheet. For example, 1855: "Motor Vehicle Accumulate Depreciation". This is to record the Accumulated Depreciation of the Asset. When the asset is sold, this account will be reset.
- Asset Master: Enter the Asset details here. After the asset details are entered correctly, the records will be captured and the computation of depreciation will be handled by the system. The list of assets will be listed here. User can click on the "Depreciation Schedule" to see the schedule of the depreciation each month. If the asset is to be sold, just click on the corresponding "Sale" link. For Asset sale, just enter the date and the amount of sale value.
- Asset Category:Use the pull down menu to select the asset category. The asset category must be entered prior to this step.
- Asset Name: Give a name to the asset. For example, "Acer PC Aspire 1234".
- Barcode/Identificator: Enter the bar code number, serial number or asset number here.
- Location: Enter the location of the asset. For example, General Manager's Room.
- User Name: Enter the user name. For example, "John Lee". This will help to track or trace who is holding on to the asset.
- Item Code: This is linked to the Item Master. Use the pull down menu to select the asset item.
- Acquisition Date: Enter the date of the asset is purchased or received depending on the company policy.
- Acquisition/Purchase Value: Enter the purchase value of the asset. This will be used to compute the monthly depreciation.
- Permanent Remaining Book Value: Some companies may want to keep a permanent value of an asset when it has reached its usable life span. For example, when a machine is purchased at $100K, the company may want to keep $1,000 for this machine in the account book permanently. Then, enter 1000 in this field.
- Depreciation Method: There are 2 depreciation methods: Straight Line and Reducing Balance. The computation formulas are shown in the sections above.
- Asset Life: Enter the number of months desired for the asset usable time span in months.
- Asset Account, Depreciation Account, Accumulated Depreciation Account: These are the respective Chart of Account. These accounts must be created under Chart of Account as explained above:
- Asset Account is an account under Asset,
- Depreciation Account is an account under Expense and
- Accumulated Depreciation Account is and account under Asset.
- Depreciation Posting: This is where it saves the time of the person who is managing the asset and the asset depreciation. The steps to post the depreciation is very simple.
- Select the Asset Category or leave it as "All" from the pull down menu. If All is selected, all the asset categories will be searched.
- Select the Fiscal Year from the pull down menu and select the month from the pull down menu. Click "Search".
- All the assets match the search criteria will be displayed. If the assets have been posted, it will be indicated on the extreme right column as "Yes". You cannot post an asset that is already posted.
- User can all click on the "Post Depreciation" button and the system will post those items that have not been posted.
- Asset Setup:
- Under the Asset Management Sub-tab, there are 5 functions namely: Asset Setup, Asset Deprecation Months, Asset Category, Assets Master and Depreciation Posting.