Category Archives for "MYOB Accounting FAQ’s"

20th of the month payables procedure (To Do List method)

This method is popular for those who have large numbers of payments to make on the 20th & need a speedy process.

  1. Enter all purchase invoices for the month
  2. Print an Aged Payables [Detail] Report
  3. Tick off each purchase that you intend to pay on the 20th (you should collate/reconcile the relevant invoices/statements behind the report, ensuring they are authorised to pay)
  4. On the 20th, check that MYOB is ready to use the next cheque number or for internet payments you may wish to let the numbers be system generated & run sequentially.
  5. Select To Do List, A/P
  6. Click in the Action column beside each purchase you intend to pay
  7. Click Pay Bills (MYOB automatically collates the purchases to be paid for each supplier into one cheque and enters the Supplier Payment against the invoices, using the system date of your PC)
  8. Print a Chequebook Register report for the 20th, sorted by ID
  9. Write out the cheques accordingly or make your payments via bank transfer.

Note: We may use this method to create a payment ‘batch’ for our bank. Check your linked accounts are set up correctly and test the method first in Clearwater or with a couple of dummy payments.

Debtors Out of Balance and customer deposits

This problem is a common one and compounded by the fact that recorded entries can’t be fixed. All we can do is get it right for future entries. The error is compounded further if a journal entry is posted by your accountant to align the debtors list with the debtors control account at year end as the debtors Out of balance (OOB) should fix itself as described below.

Assume on 30/6/12 the Debtors ledger balances to Debtors control account (OOB = $0)

The file will be out of balance by $450 due to the credit to debtors control on the 9th. Once these entries take place they can’t be deleted, reversed or re-dated. The OOB will eventually come right by itself. If it doesn’t, another problem exists which will cause an OOB. Based on these events an Out of Balance will exist from 9/7/12 to 15/7/12. On the 15/7 the OOB come back to $0 as no prepayment exists.

See the effects of the entries on the following reconciliation reports:

However, if the order turned into an invoice after the payment date which is logical then no Out of Balance will exist. After all, surely the invoice date would always be a future date?

Landed Cost Procedure for Importers

Your MYOB software cannot automatically apportion landing costs to individual line items. This procedure is a workaround to ensure that:

  1. Stock on Hand is valued at full landed cost
  2. Cost of Sales reflects landed cost of stock sold
  3. Actual landed costs can be easily identified

Please follow these instructions to set up

Setup Steps

  • Set up cost of sales accounts list as per the example:

Other actual landed costs accounts may be set up if required.

Set up stock items as normal as per the example:

Set up a Landed Cost Adjustment item as follows:

Steps to be completed for each shipment that arrives

Complete an Excel spreadsheet for the imported shipment to allocate the landed costs to the individual items.


Formulas in the above spreadsheet:

In your MYOB software, enter a purchase from the supplier for the items at full landed cost, and on the last line enter a negative Landed Cost Adjustment


There may be a rounding amount as in this case ($0.19), just leave as is.

As invoices are received for actual landed costs, enter these using service purchases and code to respective cost of sales accounts.
(Remember that Customs GST does not form part of the cost of the goods and should be coded to a separate GST Liability Account!)


How do I handle GST paid to NZ Customs for imported goods?

When importing goods from overseas, GST is calculated at 15% of the landed-cost of the goods and is payable to the Customs agent, not your overseas supplier. The GST paid to Customs needs to appear in Box 13 of the GST return. Therefore, you need to create one Purchase order (bill) to record the overseas purchase and another Purchase order (bill) to record the costs associated with the import.

A Customs agent is usually employed to handle the costs associated with the import. Generally, the Customs agent will arrange payment for, and collection of, the goods on arrival in New Zealand, and may pay your customs duty, freight, insurance and GST liability. Therefore, you will need to either ‘Spend Money’ or ‘Enter Purchases’ then ‘Pay Bills’ to the customs agent for these costs.

To Set Up

Create a Liability Account for Customs GST (2-XXXX). This account will hold the GST paid by you to the Customs agent and will be reflected in Box 13 of the GST return.

This account should be the linked account in your GST return.

Go into the ‘Accounts’ command centre.

Select ‘Prepare GST return’

Select the ‘GST Input Tax Adjustments’ account in Box 13.

prepare GST return

Once this account has been setup, record the transaction as pictured below using
Enter Purchases.

1. Using the Purchases command centre, record a transaction from your overseas Supplier as normal, excluding the GST.

2. Use Enter Purchases to enter the Import Agent’s Customs’ charges, taking care with the GST for each cost.

3. On another line, enter the value of the total GST on the Import, using the Customs GST Code.

4. For the import duty charged by the customs agent use the cost of sales accounts

5. For any other expenses the Customs agent may be charging you, (for example, overseas freight and/or insurance) enter as below, selecting the applicable cost of sale account.

customs purchase

This transaction will increase costs and include customs GST on the GST return.
Save the entry as a recurring transaction so you can use it again.

A GST return prepared from the Accounts command centre should now show the value above in Box 13.

PS this method is the most common adopted by NZ importers – other methods exist and can be used provided the accounting entry is correct.

Health check of your MYOB AccountRight file..

One of the time consuming activities of MYOB consulting is digging for dirt and uncovering entries which have gone astray in clients data files. Just because something is entered, allocated and now out of sight doesn’t mean it’s right. An MYOB accounts person should take a half day out every year to to the following check up.Health check

Follow the steps below..

  1. Bank reconciliations: have you been doing reconciliations on every single bank, savings and credit card and loan accounts? Do you have an undeposited funds or electronic clearing account with a balance of thousands when it should be $0? Do you have PAYE payable with a debit balance when it should be credit.
  2. Again on the subject of bank reconciliation – look at all entries that are more than 6 weeks older than your last bank rec. date. These are called stale transactions. Investigate each one and sort it out. Are there duplicate entries? Are they genuinely un-presented by your supplier, is the cheque lying in your drawer, is it an accountants end-of-year adjustment, did you pocket the cash or what? Find the culprit, delete, reverse or correct.
  3. Bank Feeds: Check all of your bank feed entries have been dealt with. They should either have been allocated or matched. If there are old entries there and you have reconciled then hide the bank feed entries.
  4. Post-dated transactions; Review the Transaction Journal (All) from today’s date to 31/3/2040 or find the equivalent report under exceptions reports. Are there any transactions which are future dated (we regularly find entries dated 20 years in the future!) Find them, re-date them watching for unclaimed GST and/or an income tax deduction.
  5. Prepaid Transactions:  Go to Reports, Account, Exceptions, Prepaid Transactions report. Run for your current financial year e.g 1/4/16 – 31/3/17. If you have any on the list then these have payment dates before the invoice date. Shouldn’t happen and gives you an out of balance if the entry is over financial year-end.. Kick the habit or if you really do have payments before order then start putting your payments against sales orders or purchase orders as opposed to invoices.
  6. Debtor and Creditor balances: Run the Receivables, Reconciliation Detail report (dated today) and check each amount is still unpaid. It is easy to confuse ‘Receive Money’ instead of ‘Receive Payments’. On the creditors side, run the Payables, Reconciliation Detail  Report and check each amount is still unpaid. The likely scenario is to use ‘Spend Money’ and not ‘Pay Bills’. Open the invoice and either delete, reverse or correct.
  7. Run the General Ledger Detail report for all Profit and Loss accounts for the current financial year. Check the contents of each account. Are entries in the right account?

Give yourself a pat on the back. This is a big job but someone has to do it….you!


Linked Accounts (connecting the modules in AccountRight)


How do we ensure our accounting is right when we use MYOB AccountRight as 80% of users have no formal accounting training?

The answer to this boils down to MYOB’s famous linked accounts. When MYOB is first setup for a business, you ensure the correct general ledger accounts are selected as the linked accounts. This ensures that when a transaction is entered, the debit and/or credit sides are correct. View the linked accounts in your company file by selecting, Setup, Linked Accounts.

The linked accounts for sample company, Clearwater are pictured below:

Accounts & Banking Linked Accounts

Accounts & Banking Linked Accounts

Sales Linked Accounts

Sales Linked Accounts

Purchase Linked Accounts

Purchase Linked Accounts

Warning! The linked accounts are critical to the integrity of your general ledger. We suggest you don’t change them unless you know what you are doing. Having said that you can untick the options if you don’t need them. For example if you don’t pay charges for late payment then untick the box. Then you can delete the Late Fees Paid account from your accounts list.

With regard to reports from sales & purchases, they pull information from the data entered with sales reports confined to sales/GL information and purchases confined to purchases/GL information.

Statement of Cash Flows

Few people who use MYOB accounting software, benefit from this report. It is probably the most misunderstood reports but it is one of the most useful. Why is this?

While profit is the name of the game, profits alone don’t guarantee success of a business. You can be profitable and growing as fast as Auckland’s house prices and still fail. Countless businesses go into bankruptcy while they still make profits… quite simply, they run out of cash.

A Statement of Cash Flows gives you the following:

Opening Bank Balances (Begining of month – all bank accounts)
Cash Receipts & disbursements are divided up into 3 categories:

  • Operating activities (ie day to day trading)
  • Investing activities (eg buying/selling fixed assets)
  • Financing activities (eg taking out/paying off loans, owner investing/drawing capital from business)

Within each category you can see whether the asset, liability or equity account has gone up or down to give you more or less cash on hand.

Closing Bank Balances (End of month – all bank accounts)
While this is a historical look of what has happened, the business owner can clearly see how the money was spent and why they have less or more cash in the bank.


Customer Payments & undeposited funds

Q: Our company does a lot of cash sales and then we do a banking once a week or so. I enter each sale individually but when I reconcile the bank statement the cash sale amounts don’t show individually on the bank statement, rather it shows the full banking amount for the week. What do you think I am doing wrong?

A: It makes your bank reconciliation much easier if you see one bank deposit on the screen that matches the one bank deposit you physically make each week and see on your bank statement. Follow these steps to make your bank reconciliation easier:

1. Setup, Preferences, Banking tab, mark the option “When I receive money I prefer to group it with other Undeposited funds”

2. Setup, Linked Accounts, Accounts and Banking Accounts, and check that the Bank Account for Undeposited Funds is linked to the “Undeposited Funds” account (not your normal cheque account.)

3. Enter your individual cash sales as usual. (Whether you enter the receipt through Sales, Receive Payment or Banking, Receive Money, you should see at the top of the screen that the option “Group with Undeposited Funds” is marked.)

4. When it’s time to prepare the physical banking, go to Banking, Prepare Bank Deposit and enter the date of the banking. You will see all of the individual cash sales there waiting to be banked. Just mark the ones you wish to bank in the Deposit column on the right hand side, check the total at the bottom matches your banking, and record.

When the bank feed arrives, the deposit must match with your banking entry.

You can then reconcile your bank account normally.

What do I need to have ready to set up an MYOB data file?

To save time and assist with the installation of MYOB AccountRight, you should have the following information ready for your MYOB Certified Consultant:

  • Decide which month is your “conversion month” ie the month you wish to start making entries into MYOB Accounting. This can be any month during the year but ideally it is April or the first month of your financial year.
  • Your latest set of accounts (Balance Sheet and Profit Statement) from your accountant or a list of account codes and descriptions from your previous accounting system
  • A Bank Reconciliation on the last day of the previous month (of conversion). Alternatively a list of unpresented cheques and your bank statement balance should be sufficient.Bank statements, cheque butts and deposit books should be available for your first month on MYOB accounting
  • List of debtors (people who owe you money) on the first day of the month of conversion
  • List of creditors (people who you owe) on the first day of the month of conversion
  • A copy of a well laid out invoice, statement and purchase order (if reqquired) from a supplier or from your previous accounting system. This is needed to create your new stationery in MYOB.
  • A sample of jobs or cost centres which need to be set up in MYOB accounting (if required)
  • A stock count at your month of conversion if you wish to load items to sell or you need to run a full inventory system

If this list seems overwhelming, then get ready what you can and ask your consultant or accountant to help. It is important they communicate over the installation of MYOB as both can assist you get the most from your MYOB investment. For the first 6 months to a year, you may be quite dependent on their help.

Recording Intercompany Loans

Question: Say company A makes a loan to company B. I would like to know if there are different ways of recording it in the MYOB software. Do I go through Banking–> Spend Money–> and mention it is a loan to company B in the memo, in the books of company A and go through Banking–> Receive Money–> and also mention that it is a loan from company A in the books of company B? Please I really need an answer for this question. I would also like to know if there might be another way of dealing with this transaction?

Answer: As you have seen, company loan transactions can be confusing! In the example you give you need two separate MYOB company files. In the Company A file, create an Asset account called “Company B Loan”. Use Spend Money to record the transaction to this new account, describing the loan in the Memo. In the Company B file, create a Liability account called “Company A Loan”. Use Receive Money to record the transaction to the new account, again describing the loan in the Memo. At all times you should be able to match the balance of the Asset account in Company A with the Liability account in Company B.

You should (regularly) reconcile the accounts to check they agree! Suggest you use the bank reconciliation screen to do the rec.