Accounting Considerations

Taxes

SI 5 provides a wide variety of tax estimation methods.  The recommended method will depend on the tax rules imposed on your client.  For most organizations, tax on goods (Sales Tax) and services (Labor Sales Tax) will be sufficient.  If more complex tax calculations are required, consider using the Canadian Tax Code. 

Tax rates and other global settings may be customized for each Project (see D-Tools->Options).

More details on Taxes.

Contract Percentages - Progress Billing

If your business uses progressive billing, Contract Percentages is where the billing percentages are managed.  You should set these percentages and descriptions to the values that are most often used by your organization.  Each new Project will initially have these values.  You are able to modify the percentages and descriptions on a project by project basis.  These percentages are used to calculate the installed price for each description.  This information is shown on the Contract report providing the client a detailed payment schedule with signature page.

For information on setting the default values in the Setup tab see Contract Percentages.

For information on changing this on a per project bases see Payment Schedule.

Misc. Parts %

This percentage can be used for any purpose you choose.  However it is most often used to account for the cost of consumable Products.  If you choose to use this percentage for some other purpose, such as to estimate freight charges, you will need to modify the client report label to match your intended use.  The Misc. Parts% is applied to all Non-Labor Products and is taxed as equipment.

Equipment +/- %

This percentage operates just like the Misc Parts%.  It is used to provide a percentage adjustment for all non-labor Project line items. This value can be negative in order to give a discount.

The Misc. Parts % and Equipment +/- % factors are used as part of the Installed Price calculation and are subject to the same tax as other non-labor Products.  These will show up as separate line items in the project summary section of client reports.  These two factors can be used in any way you choose such as Freight and Equipment Discounts.  However, you may need to modify the client report labels to match your intended use.

Inventory

Inventory is not managed directly by SI 5.  However, SI 5 QuickLinks (an optional SI 5 module) can create Purchase Orders, Estimates and Invoices which may be processed by QuickBooks.  These accounting procedures can make adjustments to physical inventory within QuickBooks. 

Purchasing

SI 5 has a set of reports that may be used to generate Purchase Orders for an individual Project.  Purchase orders may be generated in one of the three following ways

1)    A Purchase Order Report is run from with SI 5.  This report is faxed to your vendor(s) or used to reenter the Purchase Order(s) by hand in your accounting system.

2)    OrderTools is a built-in Purchase Order system in SI 5.  It has no links to any accounting software and the POs are created on a per Project basis. For more information see OrderTools.

4)    Products for a single project may be automatically transferred to purchase orders for supported accounting systems, reducing data entry time and errors.  QuickLinks is required.

5)    Products across multiple projects may be automatically transferred to purchase orders for supported accounting systems, reducing data entry time and errors.  QuickLinks is an optional license.

Time Tracking

Time tracking is extremely important for both job costing and labor forecasting.  Time should be recorded in the accounting system to provide accurate job cost information.  If you are using the “labor per product” method of estimating labor, then you also need to use the SI 5 Work Order system to record actual time required to complete the Work Order.  It is not necessary to track time for each individual Product.  SI 5 will allow you to distribute time across multiple Products in proportion to the original estimate.  If these time tracking procedures are consistently used, labor forecasting will become more accurate over time.

P&L by Project

All SI 5 Projects should be associated with the same Project name in your accounting software.  If you use QuickLinks, the Project name association is handled automatically.  All Invoices, Purchases, and Payroll costs can be tracked via your accounting software to create a Project profit and loss statement.  SI 5 estimates Project gross profit but does not provide accurate Job Cost analysis.  Use your accounting software for all financial analysis and reporting.

Accounting ID mask 

The accounting ID mask defines the way QuickLinks names and groups SI 5 items in your accounting software.  The mask is of the form:

MMMMMMMM OOOOOOOOOOOOO, where the number of “M”s represented the first number of characters of the Manufacturer name.  The “O”s represent the first number of characters of the Model number.  It is recommended that a non-colon separator such as a space “ “ be used between the Ms and Os.  If a colon “:” is used as the separator character, all model#s will show up as a sub-item of the Manufacturer in QuickLinks.  While this provides a nice hierarchical view of the items in QuickBooks, it is very restrictive.  In some accounting systems such as QuickBooks, all sub-items must be of the same type (Inventory or Non-Inventory) as the parent item.  If you ever wish to mix Inventory and Non-Inventory parts within a vendor, use ANY separator other than a “:”, such as the space. The non-colon separator provides the most flexibility for item assignment.  However, if you intend to code all Products as Inventory Parts, then the “:” as a separator is an option.  To use this mask, enter thirty "M"s, a colon, then thirty "O"s: MMMMMMMMMMMMMMMMMMMMMMMMMMMMMM:OOOOOOOOOOOOOOOOOOOOOOOOOOOOOO

For more details see QuickLinks.