D30This step is done to record the Inventory value / AR / AP already existing in the warehouse / Accounts before the user started using EMP. This balance is brought forward from old system to EMP. Recording these figures cannot be missed because then, Inventory / AR / AP in Balance Sheet will be understated.

For Opening Stock

• Please make sure that you have already imported the item codes first. Refer to Importing Item Code.
• From your old inventory system or stock report, list out the quantity and value for every item.
• You can set opening inventory by doing GRNs (see Direct Receiving Stock) for every item into "One Time Supplier"; Supplier Code "1". This supplier already exists in EMP, thus there is no need for you to add again. When doing this, remember to set the dates before the date you start using EMP.
  
• Example : EMP start date 1.3.2009
• Set opening stock dates in GRN to 28.2.2009 - preferably all with the same date.

For Opening AR

• Please see Customer Opening Balance.

For Opening AP

• Refer to Supplier Opening Balance.

Example 1:-

I have created the openings as follows :

Opening	Customer / Supplier / Item Name	Document	Amount	Date
Stock	FG Hardware Co.	GRN 1120	3,600	28.2.2009
AR	Amy Lee	INV 1315	1,500	28.2.2009
AP	Laptop1	GRN 1119	2,800	28.2.2009

• As you know, accounting entries normally come in double entries, affecting 2 accounts.
• However, we only want one side (BLUE) of it and eliminate the other (RED).

	Stock	AR	AP
Debit	Inventory   3,600	AR      1,500	Inventory    2,800
Credit	AP                3,600	Sales       1,500	AP                 2,800

• Reasons why the RED entries must be eliminated :
• To avoid overstatement
• To avoid double-counting
  
• Eg. Stock - We only want to record only the Inventory entry (to value stock in Inventory B/S), not the AP part. In the old system, when the inventory was bought, AP was already recorded. This amount exists in the AP RM 2,800. To record another RM 3,600 relating to previous Inventory would be distorting the total AP figure in B/S.
• Thus, to eliminate these entries, a CM can be issued. Please refer to Create Supplier Credit Memo.

Offsetting all the entries in RED above,

Debit	AP	3,600
Debit	Sales	1,500
Credit	Inventory	2,800
Credit	Contra	2,300

• As you can see, whatever debited earlier in credited in the CM and vice versa to offset the amount to be eliminated.
• The Contra GL is any "Temp" GL of your choice. Definition of Temp GL is any GL account from the P/L. This account is for the year, as it does not carry forward like "Real" account (GL from B/S).
• It does not matter which GL account it is, because all the JTxn will be deleted later. And the JTxn does not carry forward to next year.

SCENARIO A

• Financial Period SAME as EMP Start Date
• Example :
  
• Financial Period 1.1.2009 - 31.12.2009
• User start using EMP 1.1.2009
• User must generate B/S as at 31.12.2008 from the old system, then, in Set Opening Balance, enter line by line into it.
• After that, remember to delete the JTxn auto-created from the GRN, Opening AR / AP and CM (see example above).
  
• Why must we do that? Please refer to Best Practices for Setting GL Opening.
• How do we do that? Please see Set Opening Balance.
  

SCENARIO B

• Financial Period DIFFERENT from EMP Start Date
• Example :
• Financial Period 1.1.2009 - 31.12.2009
• User start using EMP 1.3.2009
• In this case, you cannot enter B/S balances in Set Opening Balance because the figures should reflect as at 28.2.2009. And the date for Set Opening Balance would follow the financial period, not 1.1.2009.
• Thus, you can enter the whole B/S as at 28.2.2009 (from old system) into 1 JTxn. As usual, do it line-by-line in B/S in Add JTxn and make sure that the Debit and Credit side balances at the end. 
• Finally, get help from the programmers to delete JTxn from opening balances (28.2.2009) auto-created from the GRN, Opening AR / AP and CM (see example 1 above).

PARALLEL RUN & CHECKING

It is recommended that users continue entering transactions into the old system alongside EMP. This is a precautionary effort to ensure that mistakes can be detected and corrected during the final stage. It would be normal that users make errors and mistakes during the implementation part of EMP. So therefore, this stage ensures that the old system and EMP syncs together.

Example 2 :-

The objective of this step is to match Old System's Accounting with EMP's Accounting and EMP's Inventory. Accounting in EMP will be extremely messed up during the implementation stage because of user errors, users are trying to familiarize themselves to EMP. Since the EMP's Inventory would be the accurate figure (can do stock count / valuation to check), both Old Accounting and EMP Accounting will need to follow this Inventory module. Please refer to the chart below.

• Financial Period 1.1.2009 - 31.12.2009
• Start usng EMP 1.3.2009
• Cut-off date 1.7.2009

How to obtain the values (as in the chart above)

• A Value - 1.1.2009
• Opening figure from audited accounts for Inventory in Old system. 
• We must start from this amount and work towards the new and correct amount.