July 08, 2010

Acctg DB: Intro

To simplify the matter, let's present a top view of how the generation of books could have been done using a database approach. Without going though the official definition of the accounting process, let's just compare it to the manual municipal tabulation of votes. The usual procedure is to tabulate the result in specialized grid ledgers or forms. However, imagine that you tabulate at least 2 kinds of result per vote: a positive and a negative vote. That means one votes for a person he likes and at the same time votes for one he dislike in that position.

Such is the nature of double entry book keeping. If you are not trained or careful, you may forget and leave out other effects of a transaction. To tabulate it, you have to double the column for a particular item: one designated as a 'value received' and a 'value parted with' effect - the debit and credit sides. Single entry tabulation is cumbersome enough done manually, doing a double entry tabulation and transcription to various ledgers will at least double the time required or the manpower. With limited personnel, a db system can be made where the journal is simplified but still can generate the specialized grid forms like cash receipts book, cash disbursement book, debit/credit memo, sales book etc. With manual system, one go through all these forms separately.

For our purposes, the following will be our wish-list of the target we have to accomplish by creating this Acctg DB System:
1) Callable templates for recurring transactions
2) Central posting database from w/c various grid forms or tables like CDB, CRB, APBook, etc. are automatically generated.
3) Source transaction tickets or vouchers are generated automatically
5) Check Writer capability
4) Balance Sheet and Income Statement can be generated at will

You say the targets we list are impossible to do with MS Excel or a DB system with our layman capabilities? Well, we will try to be understandable by average layman and Excel with a DB Backend is quite capable to do it.

Stick around as we develop this system.

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