Sage 50 Accounts For Dummies, 4th UK Edition E-Book

Jane E. Kelly

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 533

Veröffentlichungsjahr: 2016

Beschreibung

Make bookkeeping a breeze with Sage Sage 50 Accounts is a tremendously popular resource among accounting professionals, and exciting upgrades in version 22 make it even more useful. This book helps you use get started with installation as well as customisation, and in a short time you'll be running VAT returns and producing reports. Newer features help you store copies on the cloud, access data from anywhere and much more. Inside... * Fully updated screenshots * How to use Sage Drive * A guide to key buttons * New ways to access tasks * Toolbar configuration tips * Valuable window shortcuts * How to process paperwork * Project management help * Tips on using mobile apps

Leseprobe

Sage 50® Accounts For Dummies®, 4th Edition

Published by: John Wiley & Sons, Ltd., The Atrium, Southern Gate, Chichester,www.wiley.com

This edition first published 2016

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Sage 50® Accounts For Dummies®

To view this book's Cheat Sheet, simply go to www.dummies.com and search for “Sage 50 Accounts For Dummies Cheat Sheet” in the Search box.

Table of Contents

Cover

Introduction

About This Book

Foolish Assumptions

Icons Used in This Book

Beyond the Book

Where to Go from Here

Part 1: Getting Started with Sage 50 Accounts

Chapter 1: Introducing Sage 50 Accounts

Looking at the Varieties of Sage

Installing the Software

Setting Up with the Active Setup Wizard

Registering Your Software

Finding Out How Easy Sage Is to Use

Using Wizards

Chapter 2: Creating Your Chart of Accounts and Assigning Nominal Codes

Understanding as Much as You Need to about Accounting

Looking at the Structure of Your COA

Editing Your COA

Checking Your COA

Chapter 3: Setting Up Records

Choosing How to Create Your Records

Creating Customer and Supplier Records

Creating Your Nominal Records

Recording Your Bank Accounts

Getting Your Product Records in Order

Setting Up Fixed Asset Records

Chapter 4: Recording Your Opening Balances

Timing Your Switch to Sage

Obtaining Your Opening Balances

Entering Opening Balances Using the Wizard

Manually Entering Information

Checking Your Opening Balances

Part 2: Looking into Day-to-Day Functions

Chapter 5: Processing Your Customer Paper work

Posting Batch Entry Invoices

Creating Credit Notes

Registering Payments from Your Customers

Deleting Invoices and Credit Notes

Chapter 6: Invoicing Your Customers

Deciding on an Invoice Type

Creating Invoices

Remembering that Communication Is Key

Managing Your Invoice List

Saving Time While You Ask for Money

Chapter 7: Dealing with Paperwork from Your Suppliers

Receiving and Posting Invoices

Getting Credit

Allocating a Credit Note

Paying Your Suppliers

Printing a Remittance Advice Note

Chapter 8: Recording Your Bank Entries

Understanding the Different Types of Bank Account

Tracking Bank Deposits and Payments

Transferring Funds between Accounts

Repeating Recurring Entries

Dealing with Petty Cash

Paying the Credit Card Bill

Chapter 9: Maintaining and Correcting Entries

Finding Ways to Find Transactions

Searching for Records

Making Corrections

Editing a Journal Entry

Deleting a Journal Entry

Checking and Maintaining Your Files

Backing Up Data the Manual Way

Scheduling Backups

Restoring Data

Part 3: Functions for Plus and Professional Users

Chapter 10: Processing Sales Orders

Giving a Quote

Creating a Sales Order

Allocating Stock to an Order

Despatching Orders

Invoicing Your Customers

Deleting and Cancelling Sales Orders

Chapter 11: Processing Purchase Orders

Creating, Changing and Copying a Purchase Order

Placing the Goods on Order

Completing Your Purchase Order

Printing Your Purchase Order

Getting the Goods In

Creating an Invoice from an Order

Deleting, Cancelling and Reinstating Orders

Chapter 12: Keeping Track of Your Products

Taking Stock

Understanding a Bill of Materials

Processing Stock Returns

Allocating Stock

Chapter 13: Managing Projects

Appointing a Project’s Status and Costs

Managing Project Resources

Tracking Project Costs

Analysing Project Costs

Charging Your Customers for a Project

Completing Your Project

Chapter 14: Using Foreign Currencies

Setting Up Foreign Currencies

Tailoring the Foreign Trader Tool

Keeping Trade Status in Mind When Setting Up Accounts

Processing the Paperwork

Banking on Foreign Currencies

Doing Revaluations with the Wizard

Part 4: Running Monthly, Quarterly and Annual Routines

Chapter 15: Reconciling Your Bank Accounts

Recognising Reasons to Reconcile

Using Bank Feeds to Post Data into Sage

Manually Entering Your Bank Account Data

Using e-Banking to Import Data

Doing the Reconciliation

Troubleshooting When Your Account Doesn’t Reconcile

Rounding Up Stragglers

Chapter 16: Running Your Monthly and Yearly Routines

Adding Up Accruals

Counting Out Prepayments

Depreciating Fixed Assets

Entering Journals

Carrying Out Your Month-End Routine

Managing Cash Flow

Doing a Year-End Routine

Chapter 17: Running Your VAT Return

Understanding Some VAT Basics

Managing Your VAT

Checking Your VAT Return Using Reconciliation Reports

Completing Your VAT return

Investigating Other Useful Icons in Your VAT Module

Part 5: Using Reports

Chapter 18: Running Monthly Reports

Making the Most of Standard Reports

Checking the Chart of Accounts

Figuring Out the Financial Reports

Viewing the Audit Trail

Forgetting the Periods and Going Transactional

Designing Reports to Suit Yourself

Chapter 19: Tackling the Complicated Stuff

Exporting Data

Importing Data

Linking to Your Accountant

Trying e-Banking

Working with Document Manager

Chapter 20: Running Key Reports

Checking Activity through the Nominal Codes

Looking into Supplier Activity

Tracking Customer Activity

Checking Numbers with Supplier Daybook Reports

Finding the Customers Who Owe You

Paying Attention to Your Creditors

Handling Unreconciled Bank Transactions

Doing a Monthly Breakdown of Profit and Loss

Ranking Your Top Customers

Chapter 21: Going Mobile

Setting Up Sage Drive

Tackling Sage 50 Tracker

Sussing Out Sage 50 Mobile Sales

Keeping Connected with Connected Users

Part 6: The Part of Tens

Chapter 22: Ten (Okay, Eleven) Funky Functions in Sage

Browsing for Help with F1

Calculating Stuff with F2

Accessing an Edit Item Line for Invoicing with F3

Finding Multiple Functions with F4

Calculating Currency or Checking Spelling with F5

Copying with F6

Inserting a Line with F7

Deleting a Line with F8

Calculating Net Amounts with F9

Launching Windows with F11

Opening Report Designer with F12

Chapter 23: Ten (Plus One) Wizards to Conjure Up in Sage

Creating a New Customer Account

Setting Up a New Supplier

Initiating a New Nominal Account

Creating a New Bank Account

Launching a New Product

Starting Up a New Project

Helping Out at Month End: Opening/Closing Stock

Fuelling Up: Scale Charges

Saving Time: Global Changes

Handling Currencies: Foreign Bank Revaluation

Keeping Others in the Loop: Accountant Link

About the Author

Advertisement Page

Connect with Dummies

End User License Agreement

Guide

Cover

Table of Contents

Begin Reading

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Introduction

Sage is a well-known accounting system used in more than three-quarters of a million small- and medium-sized businesses in the U.K. The range of business software continually evolves, and Sage’s developers pride themselves on listening to their customers for feedback on how to improve the software. This results in regular revisions and updates that add new features to Sage each time.

This book offers you a chance to understand how Sage 50 Accounts can help you run your business effectively. Thoroughly revised to cover all the latest Sage updates, I hope you get a lot out of this fourth edition, which covers Sage 50 Accounts version 22.

About This Book

The aim of this book is for you to get the most from Sage. I use lots of screenshots to help you navigate your way around the system and offer tips to help you customise the programs and reports contained in Sage in language you can understand, even if you’re not an accountant.

Wherever possible, I show you the quickest way to do something, because you can often do the same thing in more than one way. I understand that you want a quick start, so I show you the easiest methods of doing things. You can always add details later, when time permits.

This book presents information in a modular fashion so that you get all the information to accomplish a task in one place. I don’t ask you to remember things from different parts of the book; if another chapter has information relevant to the discussion at hand, I tell you where to find it, so you don’t have to read the chapters in order. You can read the chapters or sections that interest you when it suits you.

This book includes a lot of instructions on how to proceed with various tasks in Sage. Wherever possible, I use numbered lists to indicate the order in which to do things. Names of windows, screens and menu choices are capitalised. This little arrow → indicates the path you click through in a series of menu options.

Because examples can help you see how a concept works in real life, I created Jingles, a fictitious party-planning company, and I use its owner Jeanette to demonstrate some of Sage’s reports and functions.

Within this book, you may note that some web addresses break across two lines of text. If you’re reading this book in print and want to visit one of these web pages, simply key in the web address exactly as it’s noted in the text, pretending as though the line break doesn’t exist. If you’re reading this as an e-book, you’ve got it easy – just click the web address to be taken directly to the web page.

Foolish Assumptions

While writing Sage 50 Accounts For Dummies, 4th Edition, for version 22 of Sage 50 Accounts, I made some key assumptions about who you are and why you picked up this book. I assume that you fall into one of the following categories:

You’re a member of staff in a small business who has been asked to take over the bookkeeping function and will be using Sage.

You’re an existing bookkeeper who has never used Sage before or who needs to refresh your knowledge.

You’re a small-business owner who wants to understand how Sage can help in your business.

Icons Used in This Book

Every For Dummies book uses icons to highlight especially important, interesting or useful information. The following icons are used in this book:

Look at this icon for practical information that you can use straightaway to help you use Sage in the most effective way.

This icon indicates any items you need to remember after reading the book – and sometimes throughout it.

The paragraphs next to this icon contain information that is, er, slightly technical in nature. You don’t need to know the information here to get by, but it helps.

This bombshell alerts you to potential problems you may create for yourself without realising it. Don’t ignore this icon!

Beyond the Book

In addition to the material in the print or e-book you’re reading right now, this product also comes with some access-anywhere extras on the web.

Head to www.dummies.com and search for “Sage 50 Accounts For Dummies Cheat Sheet” for a useful cheat sheet, which includes a handy keyboard shortcut checklist, a list of at-a-glance U.K. tax codes and information on how to contact Sage. You can also find a table comparing the features in the Sage 50 Accounts product range to ensure you’re using the best version for you.

Where to Go from Here

You’re now ready to enter the world of Sage. If you’re a complete beginner, starting at the beginning and gradually working through is probably best. If you’re an existing user but a little rusty in certain areas, you can pick the chapters that are most relevant to you, probably in Parts 4 and 5. This book is designed for you to dip in and out of. I hope that you find it a useful tool for developing and managing your business.

Part 1

Getting Started with Sage 50 Accounts

IN THIS PART …

Meet the Sage product range and decide which product is going to be the most useful to you.

Install the Sage software and go step by step setting up your records and chart of accounts.

Discover the tricks and tips for assigning nominal codes and navigating around the system.

Find out how to enter and check your opening balances.

Chapter 1

Introducing Sage 50 Accounts

IN THIS CHAPTER

Introducing the Sage software range

Installing and registering Sage software

Getting help from the wizards

Making your way around Sage

In this chapter, I introduce you to the Sage 50 Accounts software range. I show you how easily you can install the software and give you a guided tour, so that you can get up and running quickly – essential for busy people.

Sage works on the principle that the less time you spend inputting your accounts, the more time you spend on your business, so it makes each process as simple as possible.

Looking at the Varieties of Sage

Sage’s developers understand that every business is different, and each business has different needs. As a result, they’ve developed a range of accounting software designed to grow with your business, whatever it is. The three levels of Sage 50 Accounts software start with basic features and finish with a product that contains all the bells and whistles you can possibly want. These versions of Sage are as follows:

Sage 50 Accounts:

This is the entry-level program. Sage 50 Accounts provides all the features you need to successfully manage your accounts. You can professionally handle your customers and suppliers, manage your bank reconciliations and value-added tax (VAT) returns, and provide simple reports, including monthly and year-end requirements. This basic version is suitable for small businesses with a simple structure and businesses that need basic stock systems but don’t need systems for project costing, foreign currency, or sales/purchase order processing. If you do need foreign currency, you can pay an additional fee to add this module.

Sage 50 Accounts Plus:

This contains all the features of the entry-level model but also lets you manage project costs versus budgets and control costs of manufactured and assembled products, and has an improved stock control system to produce bills of materials and allocate stock. You also still have the ability to add the foreign currency module (at an additional cost).

Sage 50 Accounts Professional:

This includes all the features of Accounts Plus but adds sales and purchase order processing, foreign trading, bank account revaluation, and Intrastat support. Accounts Professional can handle up to 20 users and manage multiple companies. This product is suited to both small- and medium-sized businesses and offers customers a product flexible enough to suit a multitude of different businesses, including those that trade in both the U.K. and abroad.

DECIDING ON SAGE COVER

You can purchase Sage Cover at the same time you buy Sage. Sage Cover gives you technical support in case you have any problems using Sage. It may seem an additional cost burden to begin with, but I think Sage Cover is well worth the money in case you have any software problems.

Most people who use accounting packages know something about accounting but don’t necessarily know much about computer software. When your screen pops up with an error message that you simply don’t understand, a quick phone call to your Sage Cover support line can soon solve the problem.

For Sage 50 Accounts, you can choose between two different types of cover:

Sage Cover Online Support: The key features are the opportunity to use the web chat facility, where you can communicate with Sage advisors in real time by sending instant messages online. Email support is available for more detailed questions. You also get Ask Sage, which gives you online access to thousands of frequently asked questions. In addition you get access to software updates.Sage Cover Extra Support: You get all the options for Online Support, as well as telephone support, which includes call-backs, and email and online question-and-answer support. There is also an option for remote support, which means that with your permission, Sage technicians can remotely access your PC to help solve queries. In addition you can access customized reports support and webcasts.

Sometimes the Help button just doesn’t answer your question. Having someone on the end of the phone to talk you through a problem is a real bonus. The technical support team can help you solve the most awkward problems that would otherwise have you throwing your laptop out of the window in pure frustration.

Installing the Software

There is more than one way to install your Sage 50 software. Currently, Sage offers the software as a digital download, but if your Internet speeds are not what they should be, then you may prefer the traditional method of buying the product off-the-shelf and loading the CD. Whichever you choose, Sage guides you seamlessly through the process to ensure you load the software as efficiently as possible.

Check the technical specifications required to run your software: Ensure your laptop or PC is sufficiently powerful to run it. Sage is quite a big program, and you need a relatively powerful computer to run it.

Getting what you need before you get started

Whichever method of purchase you use, you should receive a serial number and activation key. Without these two pieces of information, you can’t successfully load the software. But don’t worry: If you purchase a genuine copy of Sage software, you have the necessary activation information.

You also need some details about your company:

When your company’s financial year begins:

If you’re not sure of this date, ask your accountant.

Whether you use a VAT scheme:

Your accountant can tell you whether you operate the VAT cash accounting scheme or the standard VAT scheme. If you have a VAT registration number, keep it handy.

Moving to the installation

Follow the download instructions or insert your CD into the disk drive and follow the instructions on-screen. The Installshield wizard runs and proceeds to install Sage on your computer.

Sage lets you know when the program has installed successfully. Then you can really get cracking.

Setting Up with the Active Setup Wizard

Of course, you’re champing at the bit and want to get going with Sage, so double-click the new Sage icon on your desktop to get started. The Activate Sage Software window opens, as in Figure 1-1. Sage asks you to enter your activation key and serial number. If you don’t have this information, click the MySage button and follow the online instructions.

Source: Jane Kelly

FIGURE 1-1: Activating your Sage software.

After you enter your activation key and serial number, click Continue and the Active Setup wizard opens. The wizard guides you through several different screens where you enter information as requested.

The first screen, shown in Figure 1-2, gives you four options:

Set up a new company:

If you’re new to Sage, choose this first option. Sage guides you through the automatic steps of the Active Setup wizard.

Use an existing company stored on your network:

If you already use Sage and are upgrading, choose this option, which lets you copy accounts data from your previous Sage installation.

Restore data from a backup file:

Choose this option if you’re restoring data from an earlier version. If your backup was taken from an earlier version than version 14 (2008), contact Sage for further support.

Connect to data from Sage Drive:

You’ll need your Sage ID, username and password to connect to Sage Drive to see the data that you have been granted access to.

Source: Jane Kelly

FIGURE 1-2: Putting the Active Setup wizard to work.

Choose whichever option is best for you and click Next.

The following steps take you through the process of setting up Sage for the first time.

Click Set Up a New Company and then click Next.

The Company Setup screen opens and Sage prompts you to enter your company’s information such as name, address, and contact details, as in Figure 1-3.

Make the setup speedier by putting in just the company name. You can complete the other information later by clicking Settings on the main toolbar and then selecting Company Preferences.

Click Next to access the Select Business Type screen.

A screen appears that prompts you to Select Business Type, as shown in Figure 1-4.

Click the appropriate business type.

For example, I chose Limited Company for my fictional greeting card company, Jingles. If you don’t know your business type, ask your accountant. Whichever business structure you choose, Sage applies the appropriate nominal codes and profit-and-loss and balance-sheet reports for your accounts.

Click Next and select your financial year.

Jingles ends its financial year on 31 March 2017, so the financial start date is April 2016, as in Figure 1-5.

Click Next and fill in your VAT details.

If you’re not VAT registered, click No and go to Step 6.

If you’re VAT registered, enter your registration number and use the drop-down arrow to select the appropriate VAT rate, as shown in Figure 1-6. You must enter the current standard VAT rate if that’s the rate you’ve selected. Our example, Jingles Ltd, is VAT registered.

Don’t enter any transactions until you’re certain of the VAT scheme under which you operate. Failure to use the correct scheme means Sage calculates your VAT incorrectly. Applying the wrong VAT scheme can be extremely messy.

Click Next and choose the type of currency you use, as shown inFigure 1-7.

Click Next again. Note the currency option is available only if you use Sage 50 Accounts Professional, unless you have chosen to add this as a module.

Click Next to confirm the details that you have entered on the previous screens.

If you are happy with those details, then click Create. If you need to make any changes to your data, you can click Back and revise the information. See Figure 1-8.

The system now configures, and the next screen asks if you want to customise your company. See Figure 1-9.

Click the Customise company button, and a wizard-style menu appears, where you can choose to set up the defaults for your customers, suppliers, bank, products, financials and administration. Sage offers some helpful videos to assist you in setting up the individual modules. Fill the tick-boxes as you complete each section.

If you click Setup Now on the main wizard-style menu, Sage automatically takes you to the default screen for whichever module you want to set up. Figure 1-10 shows an example of the Customer Defaults window in the Customers & Sales module.

If you prefer to use a step-by-step process, Setup Now is probably the way for you. However, in this chapter I work through setting up the modules manually so you can see where all the options are within Sage. To set up manually, click Close on the Customisation screen (refer to Figure 1-9) and return to the Getting Started page.

Note: If you don’t have time to continue with customising your company, then you can click Close and choose to do this later. In order to restart the customisation process, simply click Help from the main toolbar and choose the Customise your company option from the drop-down menu that appears.

Source: Jane Kelly

FIGURE 1-3: Asking for your company’s info.

Source: Jane Kelly

FIGURE 1-4: What type of business are you?

Source: Jane Kelly

FIGURE 1-5: Beginning the financial year.

Source: Jane Kelly

FIGURE 1-6: Registering your VAT status.

Source: Jane Kelly

FIGURE 1-7: Telling Sage what currency to use to prepare your accounts.

Source: Jane Kelly

FIGURE 1-8: Checking your details.

Source: Jane Kelly

FIGURE 1-9: Customising your company.

Source: Jane Kelly

FIGURE 1-10: Customer customisation!

Registering Your Software

After you install Sage, when you next open Sage it may prompt you to register it. You have the option to register now or later, as shown in Figure 1-11. Registering straightaway is quick and easy. Click Register Now and the next screen prompts you to complete your personal details.

Source: Jane Kelly

FIGURE 1-11: Registering your software.

After you complete your details, click Register Now. Sage checks your details. If registration is successful, a new activation key appears on the screen and in your email inbox. The email confirms you’ve registered your product and shows you your Serial Number and Activation Key. Keep this information in a safe place, because you may need it if you ever need to speak to Sage customer services.

Finding Out How Easy Sage Is to Use

Sage is a user-friendly system, using words and phrases that people easily understand rather than accounting jargon. Sage also has a lot of graphics to make the pages look more appealing and easy to navigate. For example, the icons that appear on the Bank module screen look like the entrance to a grand building – like the Bank of England, perhaps.

Sage uses terms that users understand and combines a mix of accounting terms with words such as ‘customers’ and ‘suppliers’ instead of ‘debtors’ and ‘creditors’. Accounting terminology isn’t done away with altogether, however – for example, Sage refers to nominal codes, and you still have to print aged debtors and creditors reports.

Navigating around Sage

When you open Sage, the first screen you come across is the Welcome screen, as shown in Figure 1-12. This screen provides useful links and various Help pages, including a page that shows you what’s new in Sage 50 Accounts.

Source: Jane Kelly

FIGURE 1-12: Getting started with Sage.

You can elect to not show this screen by using the drop-down menu options and selecting the page that you would prefer to see on start-up. For example, you may want to open with your current list of customers; the choice is yours. I choose to open Sage with my customers list – which to begin with is blank until I set up some customers. You can also select not to show the welcome screen upon start-up by clicking Tools, then Options and then View, and then selecting ‘Don’t display the Welcome Page’ in the Global Settings section.

At the top of the Welcome screen is the name of your version of Sage – Sage 50 Accounts Professional, for example – followed by the company name you entered when you set up Sage. (Refer to the earlier ‘Setting Up with the Active Setup Wizard’ section, which walks you through getting Sage up and running.)

The Sage 50 desktop is divided into four key areas:

Menu bar:

This bar runs horizontally across the top of the screen and is one method of navigating around Sage 50. (I give more info on this area in the section ‘

Exploring the Menu bar

’.)

Navigation bar:

This bar runs vertically down the left side of the screen, listing the key modules within your chosen Sage product.

Icon ribbon:

Depending on which module you choose from the Navigation bar, the list of icons changes across the top of the screen. These icons show you all the functionality contained within each module. For example, the customer module includes icons such as Batch Invoice/Credit, Customer Receipts and Statements, to list just a few.

Work area:

This is the main central space of your screen. You can configure your viewing preferences by choosing Tools and then Options from the Menu bar. You can change your screen view to List format, Process Maps (similar to a flowchart) or Dashboard (a graphical display). The screen automatically defaults to the List format, which is the screen that I use throughout this book.

Exploring the Menu bar

The Menu bar runs horizontally across the top of your screen and provides many navigational tools to help you find your way around Sage.

By clicking the different Menu bar options, you gain access to submenus and different parts of the system. I talk about each option on the Menu bar in the following sections.

File

Clicking File gives you options to create, access, save and share data. The submenu options are as follows:

New Report:

This takes you into Sage Report Designer, where you can use the Report wizard to design new reports.

New Batch Report:

This lets you bundle a set of individual reports together and view, export, print, or email them at the same time. Click F1 for Sage Help and type ‘batch reporting’ for more details.

Open:

This lets you access the demonstration data and practice data from here, open a report and open previously archived data, including the VAT archive.

Close:

This closes the drop-down menu.

Backup: This lets you back up your data. You can also back up your data when you exit the program. I recommend you back up your data each time you use Sage, or at least at the end of each day. Backing up more often during the day is a good idea if you process significant amounts of data. For the lowdown on backing up your data, check out Chapter 9.

Schedule Backup:

This opens the Sage Accounts Backup Manager and enables you to schedule backups for a specific time each day. Use the Settings tab to determine the details of the backup that you require. I cover this in more detail in

Chapter 9

.

Maintenance:

This lets you check and correct data, compress, recover, re-index and even rebuild data. I talk about maintenance in more detail in

Chapter 9

.

Restore:

This helps you retrieve data from a previous backup. You may need this function if your data has been corrupted and you want to return to a known point in time when the data was free of problems.

Import:

This opens the Data Import wizard where you can import records, such as customer, supplier, stock, assets, nominal accounts and project records, from other sources, such as Microsoft Excel, as long as they’re in a predetermined comma-separated values (CSV) format. This option is very useful when you set up Sage and want to import information. You can speed up the data-entry process if you import information instead of keying in each individual record. I cover importing and CSV formatting in more detail in

Chapter 19

.

Sage Drive setup:

This walkthrough guide shows you how to set up Sage Drive, which gives you real-time access to your data wherever and whenever you need it. Sage Drive uses a Sage Identity (ID), which ensures secure access to your data. You’ll be asked to login using your Sage ID or create one if you don’t have one already.

Microsoft Integration:

Using this option, you can export data to Microsoft Excel, Word or Outlook.

Send:

This lets you send a message by using your default email program.

Log off:

Clicking this option logs you out of Sage.

Exit:

Clicking this exits you from Sage. You can also exit Sage by clicking the black cross in the top right corner of the screen.

Edit

You can use Edit to cut, copy, paste, insert or delete rows, duplicate cells, or memorise or recall data.

View

The status bar is the narrow strip across the bottom of your screen, showing the name of your Sage product, today’s date, the start of the financial year and the current transaction number. You can switch this bar on and off. You can also view the user list, which shows who is currently logged in to Sage.

Modules

The modules are essentially the different components that form the whole of the Sage accounting system. The modules include the usual accounting ledgers, such as customers, suppliers, bank, nominal ledger and reporting functions, but they also include (depending on which version of Sage you purchased) additional components, such as projects, sales order processing and purchase order processing. You can also access invoicing, quotations, fixed assets, departments, VAT, and transactions functions, wizards and a diary.

Settings

The settings include the Configuration Editor and Company Preferences, which hold some of the basic information about your company and the way you installed Sage. Settings also include many of the default screens for the ledgers, which save you time when setting up records at a later date. If you use the Customisation wizard when you install Sage, you may have already seen these default screens. If you need to change the system date or check the financial year, you can do it within settings. Settings also give you access to your Sage security settings and passwords to protect your accounts data. The settings include the following:

Configuration Editor:

This holds the basic information you enter when you complete the Active Setup wizard. Some of the things you can do here include editing your customer and supplier trading terms, amending your VAT codes, and managing your project cost types and cost codes. Since version 22 it is also now possible to create new customer, supplier and project analysis fields. I discuss this further in

Chapter 3

.

Company Preferences:

This lets you enter extra information if you didn’t add everything when you used the Active Setup wizard. You may want to update your address information or check your VAT details, for example.

Customer/Supplier/Bank/Product/Invoice and Order/Email Defaults:

These settings let you amend parts of the default data you set up on installation.

Financial Year:

This identifies the start of the company’s financial year. This date is fixed when you start to enter data.

Change Program Date:

This lets you change dates when you run a month-end or year-end report. The date is normally set to the current day’s date, but there may be times, such as period ends, when you want to change the date temporarily.

Lock Date:

Here you can enter a

lock date

into the system, which means you can prevent postings before a specific date. This is useful when you process year ends. Only users with access rights to lock dates can post.

Currencies:

This lets you edit your currency requirements if you use multiple currencies.

Countries:

This lists all the countries in the world and their country codes, and identifies countries that are currently members of the EU. The Sage 50 Accounts Professional package uses this information to comply with Intrastat reporting requirements. (I talk more about Intrastat in

Chapter 17

.) You can amend the Countries table as and when countries enter or leave the EU.

Control Accounts: This gives you an at-a-glance list of all the control accounts within Sage. A control account is a summary of all entries within a specific ledger. For example, the sales ledger control account includes all transactions for all sales ledger accounts – the balance on the control account tallies with the sum of the sales ledger accounts. Control accounts are used as a check on the numerical accuracy of the ledger accounts and form part of the double-entry system that Sage performs when you enter transactions.

If you want to change the control accounts, do so before you enter any transactions – otherwise, leave them alone!

You can reconcile a control account. Just click Help and follow the instructions for reconciling debtors or creditors.

Access Rights:

Here you can set up or change access rights for particular individuals to allow them access to only certain parts or even all parts of the system.

Change Password:

This lets you change your password periodically as part of your data protection and security routine.

Internet Resources:

This gives you an Internet Resources list that you can use to set your courier and credit bureau information. You can launch your website browser from within Sage and go to your credit bureau to check the status of a customer or go to a courier’s website to track the progress of a parcel.

Tools

The Tools option is a hotchpotch of items. You can run the Global Changes wizard, carry out contra entries, run period ends, open up Report Designer and convert reports, to name but a few. I outline the options here:

Global Changes:

Here you can globally change customer or supplier credit limits, turnover values, nominal budgets, product sales or purchase prices, reorder details and discount table values.

Activation: This lets you upgrade your program and enable third-party integration with the Construction Industry Scheme (CIS) and foreign traders (if you have Sage 50 Accounts Professional). Third-party integration lets you use add-on software tailored to your specific industry. Sage has a separate module for CIS and the recording of payments to subcontractors. You can activate this scheme by clicking Tools and then Activation for businesses that fall under the scheme.

You can use the Upgrade Program option to register after your initial 30-day Sage trial period runs out.

Opening Balances:

This gives you a series of actions that you need to complete to enter your opening balances. In

Chapter 4

I guide you through the Opening Balances wizard.

Period End:

Here you can clear your audit trail, clear and delete stock as well as run your month end, allowing you to post accruals, prepayments and depreciation. This option also clears the current-month turnover figures. You can run your year end, which sets your profit and loss nominal accounts to zero for the new financial year.

Transaction Email:

This lets you exchange invoices and orders with your customers and suppliers via Microsoft Outlook. You can import any orders or invoices that you receive via email directly into your Sage accounts.

Report Designer:

Here you can edit and create new reports customised for your business.

Convert Reports:

If you have reports within Sage that are from version 12 or earlier, you may need to convert the report types (as the file extensions have changed). You can do this here.

Event Log:

This shows a history of system events. If you contact the Sage helpline with a system problem, your event log may come in handy.

Options:

This gives you options to change the settings and appearance of Sage. For example, you can change the default view of the Customers and Suppliers screens from the process map to customer or supplier lists, using the View tab. Sage has recently enabled users to change the colours of the screen. You can choose from white, light colours or dark colours. You need to play around with each option to see which one you prefer. The changes are implemented only when you reboot Sage.

Batch Reporting:

You can generate several reports from any area of the Sage software at the same time. For example, you could create a ‘Period End’ batch report and get Sage to print off the Trial Balance, Profit & Loss and Balance Sheet, all at the same time! Type ‘batch reports’ into the Search field in Sage to find more information.

Data Service Manager:

The Sage Accounts Data Service runs on the computer or server where your Sage Accounts data is held. The service acts as a gateway and controls the reading and writing of data. Using this service increases the robustness of the system, improves data security and helps optimise performance. You shouldn’t need to change or amend this in any way.

Internet Options:

Here you can vary the Sage update criteria, enter Sage Cover login details, and enable Sage Mobile by clicking the Mobile tab.

Favourites

You can store your favourite reports here. To find out how to set up favourite reports, use the Help menu supplied with Report Designer, which you access via Tools on the Browser toolbar. In Chapter 18 I go into more detail about the Report Designer.

Weblinks

Weblinks gives you a number of links to useful websites, such as Sage shop and HM Revenue & Customs (HMRC).

Help

Help is the last entry on the Menu bar but probably one of the most useful. If you want to understand more about the system and want to know how to do something, click the Help option. You have several help options to choose from, all of which take you to a Webhelp page where you can enter your keyword and click Search to find answers to your problems. In addition you can find the Customise Your Company wizard here, which you may have discovered when you first installed Sage. You can access these screens and amend your module defaults and other administrative functions at any time.

The About page now contains a raft of information about your computer, including system details, licence information and contact details for Sage. Sage support staff often find this page very useful if you ask them for help with software problems.

Using Wizards

A number of wizards wield their technological magic through Sage. Their job is to help you through a wide variety of setups and tasks. You can access these helpful creatures from the Menu bar by clicking Modules and then Wizards.

A wizard’s job is to make your work easy. All you have to do is follow the prompts and enter the information the wizard requests. Magic!

Wizards can help you in setting up Sage and day-to-day processing. They can help you set up new records for customers, suppliers, nominal accounts, bank accounts, products and projects. You can also use wizards to do the tricky double-entry bookkeeping for items such as opening and closing stock, fuel scale charges and VAT transfers. Sage even provides a wizard to help you set up the foreign trader features. In Chapter 23 I offer lots more info about Sage’s wizards.

Chapter 2

Creating Your Chart of Accounts and Assigning Nominal Codes

IN THIS CHAPTER

Getting familiar with some accounting concepts

Charting your accounts

Adding nominal codes in your chart of accounts

Changing your chart of accounts

In this chapter, I get down to the nitty-gritty of the accounting system – the chart of accounts (COA), which is made up of nominal codes. Think of the COA as the engine of the accounting system. From the information in your COA, you produce your profit and loss report, your balance sheet, your budget report and prior-year reports. Set up your COA properly and the chart grows with your business – but set it up wrongly and you’ll have problems forever.

Luckily, Sage gives you a lot of help and does the hard work for you, but you still need to understand why Sage is structured in the way that it is and how you can customise it to suit your business.

Understanding as Much as You Need to about Accounting

To use Sage, it helps if you have an appreciation of accounts and understand what you want to achieve. But you certainly don’t need to understand all the rules of double-entry bookkeeping. In this section I give you the basics of accounting principles so you can use Sage more comfortably.

Dabbling in double-entry bookkeeping

Accounting systems and accounting programs such as Sage use the principle of double-entry bookkeeping, so called because each transaction is recorded twice. For every debit entry, you record a corresponding credit entry. Doing the two entries helps balance the books.

For example, if you make a cash sale for £100, your sales account receives a £100 credit and your cash account gets a £100 debit.

Some knowledge of double-entry rules helps when you use Sage. That way, you can interpret information a little more easily. The following is a short summary of the rules of double-entry bookkeeping:

Asset and expense accounts:

Debit the account for an increase and credit the account for a decrease in value.

Liability and income and sales accounts:

Debit the account for a decrease and credit the account for an increase in value.

Fortunately, you don’t need to book yourself into a bookkeeping evening class, as Sage does the double-entry for you … phew! If you’re intrigued by the double-entry system, though, pick up a copy of Bookkeeping For Dummies by Jane Kelly, Paul Barrow and Lita Epstein (Wiley), which explains double-entry and more.

Having said that, understanding the double-entry method does help with Sage, particularly if you intend to do your own nominal journals. This knowledge also comes in handy if you intend to produce monthly management accounts. Sometimes, you need to post nominal journals to correct mistakes, and understanding the principles of double-entry bookkeeping lets you confidently process journals. Don’t panic, though – Sage has many wizards that can post things like depreciation, accruals and prepayments for you – so if you struggle with journals, leave them to your accountant or at least seek advice if you aren’t sure.

Naming your nominals

In accounting and in Sage, you bump into the term nominal quite a bit. And for good reason, as several key concepts use the word:

Nominal account:

Every item of income, expense, asset and liability is posted to a nominal ledger account. The nominal ledger accounts categorise all your transactions. The individual nominal accounts are grouped into ranges and can be viewed in your COA.

Nominal code:

A four-digit number is given to each account that appears in the nominal ledger. For example, 7502 is the nominal code for office stationery, which is an account in the nominal ledger. Sage categorises each nominal code into nine different ranges, and these categories form the basis of your COA.

Nominal ledger: The nominal ledger is an accumulation of all the nominal accounts – it’s the main body of the accounting system. Each nominal account shows all the transactions posted to that specific code, so it follows that the nominal ledger represents all the transactions of the business in one place. Deep joy, I hear you say!

To find the nominal ledger, click on Nominal Codes on the Navigation bar, down the left side of the screen.

Nominal record:

Each nominal code has an individual nominal record. To create a new nominal code, open up a new nominal record and give it the new nominal code as its reference. See

Chapter 3

for more details about nominal records.

Sage categorises nominal codes in a specific way, so don’t change them without careful consideration. Using common sense and planning at the early stages of implementing Sage can pay huge dividends in the future. You need to correctly categorise your nominal codes in order to create meaningful reports.

Preparing reports

One of the reasons you’re investing in Sage is probably so you can run reports to see how your business is doing. And your money is well spent, for Sage has many reports you can run at the click of a button. The important thing to remember is that reports are only as good as the information contained within them. The old saying ‘Rubbish in, rubbish out’ is never truer.

The two key financial reports every business and every accounting system uses are as follows:

Balance sheet:

This report shows a snapshot of the business. It identifies assets and liabilities and shows how the business is funded via the capital accounts.

Profit and loss report:

This report shows the revenue and costs associated with the business for a given period and identifies whether the business is making a profit or incurring a loss.

The profit and loss and balance sheet reports are created from the information in the COA, so it’s important to get the COA right.

I discuss the profit and loss report and balance sheet more fully in Chapter 18, where I also cover producing monthly accounts and the types of report you may need.

Looking at the Structure of Your COA

The COA is a list of nominal codes, divided into the following ten categories:

Fixed Assets

Current Assets

Current Liabilities

Long-term Liabilities

Capital and Reserves

Sales

Purchases

Direct Expenses

Overhead

Taxation

The first five categories form the balance sheet; the remaining categories create your profit and loss report. So the COA is a pretty important part of the system.

A look at the nominal list on the Nominal Ledger screen shows that the list runs in numerical order, with the balance sheet codes first. If you click the Chart of Accounts icon within the nominal ledger and look at the default layout of accounts, you notice a tab for Profit and Loss and another for Balance Sheet. You can click on either of these two tabs and a preview of the report appears on the right side of the screen.

Checking out the default COA

Being a caring, sharing software developer, Sage provides a default COA for you to use, with a ready-made list of nominal codes. (You select the type of COA you want using the Active Setup wizard, which I go through in Chapter 1.) Your COA is determined by the type of business you operate. When you install Sage, it asks you what business type to use. I use the Limited Company business type to demonstrate Sage in this book.

Although Sage can spot if a new nominal code is outside the range of the usual COA, it can’t really help with the structure of the coding system that you choose to use, so plan ahead to avoid costly mistakes.

You can also customise the default COA to suit your business. I tell you how in the ‘Editing Your COA’ section later in this chapter.

The COA is in the Nominal codes module. To display it, click Modules on the Menu bar and then select Nominal codes, or simply click Nominal codes from the Navigation bar down the left side of the screen.

The Navigation bar is in full view all the time you use Sage.

The opening screen for the Nominal codes module is shown in Figure 2-1. You can access the COA by clicking on the icon shown in the Nominal codes module.

Source: Jane Kelly

FIGURE 2-1: Looking at a list of nominal codes.

The Nominal codes screen shows a series of icons, one of which is the Chart of Accounts icon. You can also create and amend nominal codes from this screen; create journals, accruals and prepayments; and run your Trial Balance, Profit and Loss and Balance Sheet as well as several other nominal ledger reports.

For a better look at the Chart of Accounts screen, follow these steps:

Click the Chart of Accounts icon on the Nominal codes toolbar.

The Chart of Accounts window opens, which gives you a list of all the COAs you have created. At first, only the Default Layout of Accounts shows, but any subsequent COAs you create also show here.

Highlight the COA you want to view and click the Edit button at the bottom of the next screen.

Initially, the COA you want is the Default Layout of Accounts.

The Edit Chart of Accounts window for the Default Layout of Accounts screen opens, as shown in Figure 2-2. This screen shows the category types and a description in the top left of the screen, and the Category Accounts list showing the nominal codes associated with those categories outlined below. To the right of the screen, you see a preview of the profit and loss report layout.

As you click each category type in the first box, you see that the nominal codes shown in the Category Account List below change to match the category type.

The first category is Sales, as in Figure 2-2. Because Sales is highlighted in the first box, you notice that the Category Account List below shows the high and low ranges of nominal codes within each sales category. I explain the nominal code ranges in the next two sections.

Source: Jane Kelly

FIGURE 2-2: Looking at the Edit Chart of Accounts window.

If you’re not sure which nominal codes fall into the range described, you can print a complete list of nominal codes. Alternatively, you can click the number in the Low or High column and use the drop-down arrow next to the field to see which account the nominal code refers to. You can then scroll down the list of accounts that appears and view the range of codes.

To print a hard copy of the nominal list, use the following steps. The list usually consists of two or three pages, but the length depends on the number of codes you create. The more codes, the longer the list.

From the Navigation bar, click Nominal codes.

Click the Print List button at the top right (third from the end) of the screen.

A command is sent to your printer to run off a hard copy of the existing codes.

The list of nominal codes may look rather daunting at first, but I talk you through the basics in the next sections.

Identifying balance sheet codes

The balance sheet