Detailed Course Notes

Detailed Course Notes Introduction to MYOB Lecture delivered on 28 March 2011

1. Short introduction for myself and my background with MYOB

- I run an MYOB Consultancy business, focusing mainly on the small to medium sized market with revenues between $1M and $10M. - I am a MYOB Certified Consultant and have recently been engaged by MYOB to teach courses to the public - Have been a Chartered Accountant for 15 years, starting in Canada and then here in Australia for over 10 years. - Will post some notes for you to download from www.traceynewman.com.au

2. Brief history of MYOB the company and the market share it has in the Australian Market, major competitors, target market.

- MYOB was started over twenty years ago. - They have over one million clients across Australia and New Zealand and over 50 products covering accounting, payroll, retail point of sale, client relationship management, websites, tax and much more. - They hold a 70% market share in Australia, according to Open Briefing (info portal for ASX listed companies) - The remainder of the market is held by Reckon’s Quickbooks - The product line we will concentrate on during this lecture is the AccountRight series of products.

3. Overview of the MYOB AccountRight suite of products and the differences between these products.

Follow this link for a diagram comparison: http://myob.com.au/products/small-business/accounting-finance-1258090694805? productArea=Compare

1. MYOB Live Accounts ($25 per month) 2. Business Basics – for very small businesses, create sales invoices, use spend/receive money ($250) 3. Account Right Standard – all modules except payroll/time billing) ($430) 4. Account Right Plus – all modules (except foreign currency) ($800) 5. Account Right Premier – allows multi user and foreign currency ($1,850) 6. Account Right Enterprise – multi location for inventory, all of the above and gives you a terminal server license to access remotely ($4,300)

4. Demonstrate setup considerations when setting up a new data file, including customization of the chart of accounts, assigning tax codes, assigning linked accounts.

- Open Clearwater sample file using MYOB AccountRight Plus v19.5 - Overview of Clearwater – this is a company that provides sales and service of water coolers in an office environment. - Use of wizards to guide you through the setup process – will get an option if you go to File | New (new company file assistant) - Alternately, you can return to this wizard by going to Setup | Easy Setup assistant - Go to Accounts | Account List - Numbering convention in MYOB 1 – Assets, 2 – Liabilities, 3 – Equity, 4 – Income, 5 – Cost of Sales, 6 – Expenses, 8 – Other Income, 9 – Other Expenses (relate this back to Clearwater) - We have decided to start a new business line which is repairs and resale of used Coolers. We wish to reflect this separately in our profit and loss to show this as a separate business area. We will setup general ledger accounts 4-6000 Used Sales & Service and then setup 4-6100 Sales – Used Coolers and 4-6200 Repairs – Used Coolers and 5-1150 Purchases – Used Coolers. Assign Tax Codes to these accounts. - Setup | Linked Accounts – these are the “other” side of a journal entry that is created automatically by MYOB when you enter data. - One of most common consulting engagements I get is when linked accounts go out of balance. Demonstrate an accounts receivable out of balance situation.

5. Demonstrate other setup considerations - creation of card, jobs, and categories, customization of templates such as invoices and payslips.

- MYOB categorizes all information about third parties that deal with your business in cards. There are four types of cards which are Customer, Supplier, Employee and Personal. - We are buying all of our used Coolers from one primary Supplier who is called “Used Coolers to You”. We need to set up this card. - Lists | Jobs - Jobs are used when we need to run a profit & loss analysis on a special project that is considered a micro section of the profit and loss. Clearwater has chosen to use a job to track a major project to install two coolers in a Shopping Centre. Call this job 130 XYZ Shopping Centre and the two jobs 131 “Cooler 1” and 132 “Cooler 2” - Jobs are only relevant for P&L items. - Run a job P&L for all jobs from 1/7/2009 to 30/6/2010 - Categories can also be used to enable a “double drill down” approach. This may be helpful if you are trading as more than one legal entity and also need to analyse projects by that entity. You can run a report by category or job. - You can customize all templates in MYOB to show your company logo and incorporate the database fields you wish to show (if time open the TraceyNewman1 invoice | time billing layout and show the customization of an invoice template)

6. Invite questions about the setup stage.

Open the Clearwater Sample Data file in the most recent version (v19.5) of MYOB AccountRight Plus and work through transactional processing of the following modules:

- Demonstrate Support Notes, which can be used extensively to teach yourself how to use the product. In addition, MYOB offers courses throughout the year that you can enrol in which is a cost efficient way to properly learn the program using case studies. Support Note to be demonstrated is Accounts Receivable out of balance http://myobaustralia.custhelp.com/cgi- bin/myobaustralia.cfg/php/enduser/std_adp.php? p_faqid=9096&p_created=1149578300&p_sid=qwxKSXpk&p_accessibility=0&p_redirect=&p _srch=&p_lva=&p_sp=cF9zcmNoPSZwX3NvcnRfYnk9JnBfZ3JpZHNvcnQ9JnBfcm93X2Nud D03NDMsNzQzJnBfcHJvZHM9JnBfY2F0cz0mcF9wdj0mcF9jdj0mcF9zZWFyY2hfdHlwZT1hb nN3ZXJzLnNlYXJjaF9ubCZwX3BhZ2U9MQ!!&p_li=&p_topview=1 and MYOB Courses that are held http://myob.com.au/business/training-events/training-courses-pricing- 1258090678511

7. Banking (bank reconciliation, spend money, receive money), demonstration of the help screen.

- We are now ready to perform a bank reconciliation. You can see that the last time we reconciled our bank account was 30 April 2010 and the balance per the bank statement on that date was $94,520.61. We now wish to reconcile our account to 31 May 2011 with a closing balance of $97,339.24. We go into our internet banking screen and view the following (open Clearwater bank statement). - We can now work through each line on the bank statement and match it against our data entry in MYOB. - You can see that we have four unresolved items – we have two bank charges to enter, one payment of interest and we have an old transaction dating back to November 2009 that needs to be investigated or deleted. We discover that the November 2009 cheque has not been presented and we have since written another cheque in January 2010 that was presented. This transaction needs to be deleted. Use spend money to record the final three transactions. - Show the recap transaction feature to demonstrate the linked account. - Spend money is generally used to record transactions that have been paid for at the same time as the purchase or to enter transactions that are charged directly to the bank account (bank fees, lease payments, other payments set up as a monthly transaction). - Receive money is generally used to record transactions that have been entered in your bank account that are not related to a debtor payment, such as payment of interest and other miscellaneous income like tax refunds. - Use help screen to research how to delete a transaction.

8. Inventory (items list)

- We need to enter an item that which will be our used coolers. - The inventory area is used to setup and track our inventory items. This screen can be used purely to list items and use them in sales and purchases screens without tracking a perpetual balance, or can be used as a full inventory system whereby perpetual balances are kept and inventory counts are done on a periodic basis. - Inventory | Items List - New - Item Number 750 - Tick, I buy, I sell and I inventory this item - Cost of Sales Account – 5-1150 - Income Account – 4-6100 - Asset Account – 1-1400 - Tax code when bought GST, tax code when sold GST, tax incl.

9. Purchases (enter purchase and pay bills, difference in purchase invoice layouts).

- We now need to purchase some used Coolers to sell to our customer base. - We use the enter purchases screen to enter all purchases that are made from our suppliers. This screen is much more extensive than spend money and it allows us to enter an invoice number and some detail about the purchase - Card – Used Coolers to You. Cost $1,000. We have purchased 20 Used Coolers at $50 each. - Show recap transaction - Go back to items list and view item number 750. You can now see that we have 20 on hand and our most recent cost is $50/item - Go to analyse purchases. You can see that we now show a liability/payable to Used Coolers to You of $1,000 and that the debt is current (0-30 column).

10. Sales (enter sales, receive payments, difference in sales invoice layouts).

- It is time to enter a sale to a new customer that has bought a used cooler system. - This is a new customer called Magic Marketing Systems. Set up all relevant information. - Magic Marketing has bought 10 Coolers at a cost of $75 each for a total sale of $750 including tax. - Show recap transaction - Go back to items list and view item number 750. You can see that we now have 10 on hand and in the history screen we can see our margin earned on the item. We can also enter in the recommended sales price of $75.

11. Time Billing (create activities, enter activity slip, prepare time billing invoice).

- MYOB is also capable of handling businesses that sell their time, such as professionals like myself who charge an hourly rate for services. - Magic Marketing has had a problem with two of their coolers and have called us back to do some servicing. - View activities – two items set up for service and travel - Enter activity slip, choose Alan Long - Customer will be Magic Marketing - Put in 0.5 unit of travel - And 1 unit of servicing - Tick use activity slip notes - Prepare invoice - View Sales | Analysis and confirm that there are two sales invoices showing in the debtors list, one for the purchase of 10 cooler units and 1 for the service of the coolers

12. Payroll (set up payroll category, process payroll).

- It is now time to process the payroll for our employees. They are paid weekly - Show payroll categories screen and the employee card screen for Peter Parker - The payment date is 1.4.10 - The payment period is for the week from 27.3.10 to 2.4.10 - All four employees have been set up on a standardized pay. They all earn standard wages. - Only difference this pay period is that Peter Parker has one sick day to take. We enter 7.6 hours sick in his payslip and the gross wage automatically recalculates to accommodate for this. - Recap transaction

13. Demonstrate the Find Transactions screen, different ways to search for a transaction.

- We need to amend the invoice for Magic Marketing. We charged them $75/Cooler but they have brought to our attention that the cost should have been $70 due to the bulk buy they made of 10 Coolers - We need to find this transaction and modify the invoice. - How would we search for this transaction? - We can search by account number if we remember the account number that was used, but the easier way would be to search by card - Open the invoice, update and close

14. Demonstrate the different reports available to print and export.

- General Ledger by specific account - Profit and Loss - Balance Sheet - Debtors summary and creditors summary

15. End of period considerations – record journal entry, review reports, lock periods.

- Show journal entry screen, post a journal to demonstrate manual entries that need to be made, these can be memorized - Setup | Preferences, lock period

16. Future of MYOB – dot net platform

- MYOB is currently going through a big update process and will be releasing the program via new updates. The biggest improvement will allow the user to customize reports by using a report writer, which is a big source of frustration at present.

17. Invite Questions about transactional processing / end of period in MYOB.