Purchases with Inclusive Sales Taxes: Implementation Checklist
The following sections provide details you can use to ensure that the system is configured properly for processing a purchase with an inclusive sales tax applied, and to understand (and change, if needed) the settings that affect the processing workflow.
Implementation Checklist
We recommend that before you initially process a purchase of taxable items, you make sure the needed settings have been specified and entities have been created, as summarized in the following checklist.
| Form | Tasks to Perform |
|---|---|
| Taxes (TX205000) | Make sure that each inclusive document-level sales tax your company intends to use have been created as described in Invoices with Inclusive Sales Taxes: Implementation Activity. |
| Tax Preferences (TX103000) | Make sure that the tax rounding gain and loss accounts have been defined; the system will post tax rounding gains and losses that may occur when posting tax amounts to these accounts. |
| Stock Items (IN202500) | Make sure that the needed stock items have been configured. |
Other Settings That Affect the Workflow
You can affect the workflow of processing purchases with an inclusive sales tax by specifying additional settings as follows:
- On the Posting Settings tab of the General Ledger Preferences (GL102000) form, specify the following general
ledger settings:
- To cause GL batches to be immediately posted after they are released, select the Automatically Post on Release check box.
- Clear the Generate Consolidated Batches check box to cause every AP transaction you enter to be posted as an individual batch to the general ledger. (When this check box is selected, the system consolidates into a single batch all transactions in the same currency posted to the same period for all documents being released.)
- In the Rounding Settings section, specify a rounding limit in the Rounding Limit box. This setting causes the system to post any discrepancy between the document-level tax and the total of tax amount of each document line, which is under the specified value to a special account.
- On the General Settings tab of the Accounts Payable Preferences (AP101000) form, specify the following accounts
payable preferences:
- To give AP bills the On Hold status when they are created, select the Hold Documents on Entry check box in the Data Entry Settings section.
- Select the Require Vendor Reference check box in the Data Entry Settings section, if you want users to enter a payment reference number in the Vendor Ref. box when creating an AP bill on the Bills and Adjustments (AP301000) form.
- Make sure that the Automatically Post on Release check box is selected in the Posting Settings section. This setting causes AP bills to be automatically posted to the general ledger once they are released.
- On the Tax Preferences (TX103000) form, specify the following
tax settings:
- In the Tax Rounding Gain Account box, an account where the system will post amounts resulting from tax rounding gains
- In the Tax Rounding Loss Account box, an account where the system will post amounts resulting from tax rounding losses
Testing of Settings
To make sure that all settings are configured correctly, we recommend that you process a purchase with an inclusive sales tax by performing instructions similar to those described in Purchases with Inclusive Sales Taxes: Process Activity.