To provide your company with day-to-day accounting capabilities, CORE comes with various features that make it easier to keep track of accounts receivable (A/R), accounts payable (A/P), client and vendor transactions, and data integration with supported accounting programs.
The accounting tasks are typically performed by billing managers or accountants in a company but might be delegated to the admin staff as well. Before using the accounting features, we recommend specifying the default A/P (such as Bank or credit card account) and A/R accounts, which then get automatically added to your Chart of Accounts. In CORE, you can set up A/R and A/P accounts in the Global Settings, Clients, Projects and Vendors screens. Time and expenses inherit these accounts from the Projects screen. You also need to decide which accounting method to use in your company: accrual or cash-based.
In an accrual-based system,
Invoices = Income
Vendor Bills = Expense
In a cash-based system,
Payments/Deposits = Income
Pay Bills or Expenses = Expense
If you are just getting started in CORE and have historical balances from a manual system or another accounting system, you need to enter the opening balances to use these accounting features. To specify details and accounts for different items, you can use the manual invoice option or manually enter the opening balances in the relevant A/P and A/R modules. To enter project-specific balances, use the opening balances option in the Projects screen.
From the accounting perspective, all transactions debit and credit certain accounts. Check out this table to see how transactions affect your account balances.
|Creating invoices||increases the Income/Sales Tax account||increases the A/R account|
|Recording payments||decreases A/R account||increases Undeposited Funds/Bank/Asset account|
|Making deposits||increases Income account decreases Undeposited Funds account||increases Bank account|
|Transferring funds||decreases Bank account||increases Bank account|
|Writing off bad debts||decreases A/R account||increases Expense account|
|Entering vendor bills||increases A/P account||increases expense account|
|Paying vendor bills||decreases Bank account||decreases A/P account|
|Entering vendor credits||decreases Expense account||decreases A/P account|
|Entering credit card charges||increases A/P account||increases Expense account|
|Paying credit card bills||decreases Bank account||decreases Credit Card account decreases A/P account|
Note: You can get a visual overview of this feature in CORE from the General Accounting flowchart.