Accounting rules are the tests which Mamut Validis applies to your accounting data to examine the basic logical accounting principles that should be evident in your accounts. These are designed to ensure that your financial statements are properly constructed, and that only expected behaviour is recorded for each transaction. Examples might include checking that an account closes in the correct position; checking that purchase and sales transactions are recorded in the correct accounts; and ensuring that there are no unexpected debit or credit entries in accounts where they should not be. Mamut Validis reports any breaches of these rules as potential anomalies and groups them according to the relative importance of the rule.
Mamut Validis has hundreds of accounting rules which are applied against every nominal code in your data. They provide what can be thought of as a "sanity check" of every single transaction in the data. The rules apply to either the Balance Sheet items, the Profit and Loss items or both. Amongst other things, the accounting rules ensure:
Accounts close in the correct position. For example, that the Sales account is in a credit position, so as to represent the income of a company; and that the Expenses account is in a debit position, to reflect the costs to the company; and so on.
Accounts that are collection buckets for transactions collect only the expected debit or credit entries. For example, that Capital and Reserves contain no debit entries; that Sales does not contain debit entries that may reduce the income position for tax purposes; and so on.
Accounts do not contain any unexpected transaction types, so as to ensure the correct 'filing' of transactions, and that there are no mis-statements of key lines in the Profit and Loss statement. For example, Purchases and expense accounts should only contain purchase transaction types, and Sales and income accounts should only contain sales transactions.
If your accounting data fails any of these tests, Mamut Validis identifies the offending transactions, or groups of contributory transactions, as potential anomalies and reports them as part of its analysis. The Accounting Rules screen displays a list of the Mamut Validis accounting rules, and allows you to select the rule you want to work on.
How to edit an accounting rule
Select the menu option Configuration - Accounting
Rules Editor. The Accounting Rules
screen is displayed; initially showing a list of the rules that apply
to your Balance Sheet. The rules that are currently being applied to your
accounting data are indicated by a tick; those which you have switched
off and which are not being applied are shown with a cross.
If appropriate, use the buttons at the top-right of the screen to change the rules being displayed, as follows:
.View Balance Sheet: Displays the rules
that only apply to your Balance Sheet.
.View
Profit and Loss: Displays the rules that only apply
to your Profit and Loss.
.Both Balance Sheet and Profit and Loss:
Displays the rules that apply to both your Balance Sheet and Profit
and Loss.
Click on the trend rule you wish to edit.
Choose to either Enable or Disable the rule by checking the appropriate box.
Set level of importance from the drop-down list by choosing Low, Medium or High.
Set rule frequency to either monthly, quarterly or annually through the drop-down menu.
Select accounts you would like the rule to be applied to, by checking the appropriate boxes.
Click Apply to approve the changes and finish editing the rule.
You have now selected the accounting rules
for editing.
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