Accounting 3.0 has arrived: how the Odoo accounting package can change the lives of finance departments and business leaders by providing reliable information for rapid decision-making.
When we deploy or present the Odoo management software package, we are often confronted with a little ‘resistance’ from accountants who think that their jobs will be threatened if the package is installed. This is not the case; however, the implementation of such a software package entails changes in the way accountants work; they have to carry out more control and analysis, and ‘make the figures talk’.
Accounting in ‘pure accounting’ software’
Corporate accountants in most companies in Senegal (and indeed in French-speaking Africa) use «purely accounting» software, generally learned at school and used by most SMEs.
In our opinion, this use over the years, before the arrival of affordable ERP systems, has led to a distortion of the accounting function.
In this world, accounting software is controlled solely by accountants, who therefore have a certain amount of power (they hold the information). To get his figures, the company director has to wait for all operations to be ‘entered’ correctly, for bank reconciliations to be carried out, for lettering to be done...
In this system, the accountant receives the documents (invoices, vouchers, etc.) makes the accounting entries (which only he can do), and files them. The accounts are not necessarily up to date, due to the sometimes large number of documents to be processed. There is a high risk of data entry or posting errors, and even differences of interpretation between accountants within the same company.
In such cases, the accounting department is isolated from the rest of the organization and becomes virtually a ‘black box’, with no links to the company's other functions.
The accounting approach in ERP
In the world of ERP (Enterprise Resource Planning), company operations are tightly interlinked; information is entered once and shared with the various relevant parties. Information is available in real time and «transformed» once it reaches the accounting department; there is no need to re-enter information, as it is already encoded at the origin.
ERP completely changes the way accounting information is processed at company level, and facilitates the circulation of this information. Properly parameterized, ERP makes it possible to obtain information that is reliable in advance, and normally available in real time for decision-making.
Accounting in Odoo
Two concepts are fundamentally changing the approach of accountants: accounting document entry and bank reconciliation.
Accounting ‘entry’ with market accounting software
Accountants love the term ‘seizure’ of documents. After analyzing the transaction, they determine the appropriate account, record the transaction in the accounting journals known only to them, transfer the accounting document number given by the software to the document so that they can find the receipt later in the event of an audit, and finally, file the document in a chrono (which generally corresponds to the accounting journal). ! That's all there is to it, until payment arrives.
At the time of payment, the accountant also collects the settlement voucher and records the transaction.
Accounting ‘entry’ is reduced in Odoo
There is no real accounting ‘entry’ in Odoo. Supplier and customer invoices, receipts and disbursements are ‘entered’ via a form set up with accounting configurations.
To enter a supplier invoice, simply select the supplier's name, the invoice reference and the date. Then select the item purchased from the supplier, the unit price and the quantity.
It's all a matter of setting up the item (this is the accountant's job): each item (any item - service, storable goods, consumables) is linked to an expense or revenue account and a tax account (VAT, 5% withholding, BNC...). So, when an item is selected (e.g. electricity), the expense account is automatically filled in, along with the taxes (if deductible) and the amounts including VAT. This avoids errors in accounting allocation and differences in interpretation between accountants. This ‘entry’ can be performed by non-accountants, but the preliminary settings must be made by accountants.
In this scheme, accountants must ensure, for example, that internal controls are in place (checking conformity of order and invoice) and verify the validity conditions of supplier invoices (compulsory information).
Preparation of bank reconciliation statements
A genuine internal control tool for detecting any fraud or embezzlement, bank reconciliation statements are often drawn up in Excel; the person in charge of drawing them up edits the bank account ledgers and ‘points’ the movements with the bank statement. Unpostmarked movements are then carried forward to the bank reconciliation statement on the Excel sheet; no reconciliation discrepancies are tolerated (the wood for the trees).
Bank reconciliation in Odoo
Bank reconciliation in Odoo is facilitated by importing the bank statement in simple CSV format. Transactions on the statement are matched directly in Odoo with those in the accounts. Semi-automated reconciliation is also available.
Once the accounting system and the statement have been reconciled, suspense items are automatically generated and appear on the bank reconciliation statement, edited from Odoo.
The future direction of corporate accountants
Corporate accountants have certainly understood that the way in which accounting is carried out has completely changed; we no longer need to talk about ‘data entry’, but rather about controlling and analyzing operations. Accountants need to move away from routine operations with no real added value, and devote themselves more to internal accounting control and figure analysis. He must position himself as an advisor to the CFO, the company manager, providing reliable data in real time for sound decision-making.
The current ERP packages on the market, and Odoo in particular, can help to transform the accounting function.
About Moore Senegal
Moore Sénégal Consulting has been an Odoo partner for 10 years, and has deployed the solution for several customers in Senegal and the sub-region. What makes our approach special is that we have Odoo-certified consultants with business expertise: chartered accountants, management controllers, analysts, human resources consultants, etc. We also develop modules tailored to the needs of companies in Senegal.
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