Orax SDI Cloud Reference

Journal Entries

Overview:
Journal entries are used to move money between general ledger accounts. It can also be used to move money between divisions, adjust sales commissions or perform projects allocations while keeping the money in the same general ledger account.

Automatic Journal Entries:
This system sometimes creates journal entries automatically based on certain actions performed in source documents. For instance when a sales commission is allocated on a sales invoice, the system will automatically create the associated journal entry.

Manual journal entries can be used to move funds between general ledger accounts as needed.

Journal entries are typically created manually or by the system for the following reasons: to account for Expense Claims, sales commission allocations, divisional allocations, quantity adjustments, accounting adjustments and customer or supplier discounts.

In the Orax SDI system journal entries are made by allocating a specific amount between a debit and credit account. This is to ensure that the General Ledger remain balanced. Should a transaction require multiple allocations, you will have to create more than one journal entry.

After changes has been made to the journals, it is required to post the changes to the general ledger before seeing the effect in the trial balance.

The Journals tab provide 2 specific divisional allocation functions.
The first is called "Division Movements". These are journal entries that will create a once-off movement of funds between 2 divisions without moving the money out of the applicable general ledger account.
The second option is called "Division Allocations". These are configurations that will automatically create journal entries each month in the general ledger in order to move funds between divisions on a recurring basis. These are handy when you allocate a certain portion of an expense or revenue to a specific division for budgeting purposes.