INTERNATIONAL MODULE

Overview

The International Module includes multi-currency processing and landed cost.  In addition, the sales tax system is flexibly designed to handle international requirements.  These three international capabilities are described below.

Multi-currency processing

Multiple currency processing allows you to enter transactions in up to ten different currencies (which we refer to as source currencies) while keeping your financial reporting in your own currency (which we refer to as the base currency).

Each currency is set up via IM-B  Enter Multiple Currencies and currency exchange rates are maintained in a table via IM-C  Enter Currency Exchange Rates.  Each time you update exchange rates, a record is saved of the previous exchange rates so that transactions, no matter how far backdated they are entered, can be matched to the closest historical exchange rate.

Your inventory, expenses, revenues, purchases, and sales are posted in your base currency.  Monetary accounts (Accounts Payable, Accounts Receivable, Sales Order Deposits, PO's Rec’d not Invoiced, foreign currency Bank Accounts) are maintained in the source currency.  Each currency has its own GL accounts for these monetary balances so that they can be kept separate on your General Ledger.

Whenever you wish to review financial statements, whether in mid-period or at the end of a period, you run a Convert to Base Currency routine in IM-B  Enter Multiple Currencies that translates the monetary accounts into your base currency at current exchange rates.

Landed Cost Processing

In many countries the landed cost of importing goods and materials (freight, duty, customs fees, broker fees) often represents a significant portion of cost that must be reflected in the inventory cost of items.

The program provides the means of setting up general ledger accounts for these costs via IM-D  Enter Landed Cost Defaults, a table of duty codes and percentages via IM-E  Enter Landed Cost Duty Codes, and a table of customs brokers and fees via IM-F  Enter Landed Cost Customs Fees.

Duty codes can be assigned to inventory items via IN-B  Enter Inventory, and customs brokers can be assigned during PO-C  Receive Purchase Orders.  When items are received through PO-C, the landed costs (freight, duty, customs fees, broker fees) are calculated and added to each item's inventory cost.

Sales & purchase tax processing

Sales tax processing in the United States is straightforward and usually involves a single sales tax rate applied to selective line items with a single tax total at the bottom of the invoice.  In other countries, however, multiple taxes (such as federal taxes, provincial taxes, local taxes, value added taxes, excise taxes) often apply and sometimes must be itemized on the invoice.  In some cases, taxes are applied in a hierarchical fashion in which some taxes are taxes on taxes.

 

You can set up tax codes for each type of tax via SM-E  Enter Tax Codes and then group these taxes together via SM-F  Enter Tax Groups.  Any number of these tax groupings can be set up and assigned to particular customers and vendors.  You can specify whether freight is to be taxed and whether a tax applies to other taxes.  If you want the taxes itemized and printed out on the invoice, there is a setting in IM-A  International Configuration that allows you to activate this feature.

In regards to sales taxes on purchases, in the United States the collection and reporting of such taxes is the responsibility of the vendor.  In some other countries, however, this is not the case and the tax must be accounted for and reported in the same fashion as sales tax.  The same type of tax codes and tax groups used for sales taxes can also be set up in SM-E and SM-F for taxes on purchases.

Finally, in some countries excise taxes are applied on both sales and purchases in which the tax is embedded in the price of the product.  These type of taxes are set up via IM-G  Enter Tax-In Codes.  When invoices get posted, the sales amounts that get reflected in sales reports and the General Ledger are reduced by the amount of the excise tax so as not to be overstated.

All of the taxes described above can be listed via AR-K  Print Sales Tax Report and can be transferred for payment via AR-L  Transfer Sales Taxes.