Introduction
Please note that for any item to be considered for automatic journal entries, it must have a purchase cost greater than $0.00
Automatic journal options
The automatic journal creation settings can be found in my company under the financials tab.
- If the nothing option is selected: Paragon will not create any journal entries and your financial statements will not be updated. This would potentially be your preference if you are using another accounting software. Please note that if this option is initially selected and then changed at a later time, only subsequent financial journal entries will be considered.
- If the financials only option is selected: Paragon will create automatic journal entries when any financial transaction is changed to issued status.
- If the financials, shipments, and inventory option is selected: Paragon will create automatic journal entries when any financial transaction is changed to issued status, when any shipment is changed to complete status, and/or when any manual inventory change is made. It will not, however, create a journal when a receipt is completed.
- If the financials, receipts, shipments, and inventory option is selected: Paragon will create automatic journal entries when any financial transaction is changed to issued status or when any inventory receipt is changed to complete status. Receipts and shipments will create automatic journals when they are changed to complete status.
Financials only
Financial transactions include invoice, credit, vendor invoice, vendor credit, make payment, and receive payment.
Here, we'll review which financial transactions generate these journal entries and how to view them once they've been created.
For our example, we'll look at invoices. As soon as an invoice is changed to issued status, Paragon knows to create a journal entry for the amount of that invoice with links to all the appropriate GL accounts and with the proper currency exchange rates. When the invoice is issued, you see a notification that gives you the sequence number of the journal entry that was just created so that it can be reviewed or verified.
The journal that is created includes the following information:
- Source of the journal (in this case an invoice and its sequence number)
- Exchange rate that was used for the currency conversion on that transaction
- All affected GL accounts and the dollar amounts that were used for each account
Financials, Receipts, Shipments, and inventory
If this option is selected, all financial transactions will generate journal entries as outlined above and all inventory receipt transactions will also generate a journal in a very similar fashion. Here, we'll use an inventory receipt from a purchase order as an example.
As soon as your receipt transaction is changed to complete status, the journal is created.
The same information is included in the automatic journal.
- Source of the journal (in this case a receipt and its sequence number)
- Exchange rate that was used for the currency conversion on that transaction
- All affected GL accounts and the dollar amounts that were used for each account
The above process is true for any inventory adjustment - receipts, shipments, and manual stock adjustments.
Note that if you complete a receipt from a work order with custom BoM, the journal will include the receipt values plus the custom BoM values.
Note that if you complete a receipt from a work order with custom BoM, the journal is created for the custom BoM values only.
Missing exchange rates
Every time a system-generated journal is required, the default exchange rates are verified and used based on the currency of the transaction and the rates that have been set up for the date of that transaction. If at any time a valid exchange rate cannot be found, you will see a notification alerting you that the journal could not be created:
Allow 0$ Journal Entries
Certain situations require you to create transactions that should have a $0 value journal entry. For example, when sending out free samples to customers, you might end up with a $0 transaction. Paragon gives you the ability to create journal entries with a $0 amount for such scenarios.
Under the financials tab in My Company, you can toggle the setting on from the lefthand side menu.
You will need to make sure that your GL is set up correctly with the attribute of your choosing to make the automatic journal entry 0. In this example, we are setting it up for the Shipments module, with the attribute scale, when Scale 1 is selected. In this scenario, Scale 1 is a free sample scale.
Now, when completing a shipment with an item that has Scale 1, the automatic journal entry created will have a $0 value.
Navigating to the journal entry confirms that the value is correctly $0.
Journal listing WIGO report
If you would like to see a listing of all entries created in the journal, run the journal listing WIGO report from the reports menu.
Import inventory
You can also import inventory using the universal translator (UT).
This wiki will give you more information about the creation of journal entries when importing inventory.
What's next?
If you're looking for more help on journal entries, take a look at these handy articles and explore further!