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Tuesday, July 13, 2010

Purchase Ledger in Computerized System

A computerized purchase ledger will certainly be expected to keep the purchase ledger up-to-date, and also it should be able to output various reports requested by the user. In fact, a computerized purchase ledger is much the same as a computerized sales ledger; expect that it is a sort of mirror image as it deals with purchases rather than sales.

Input to a purchase ledger system

Bearing in mind what we expect to see held a purchase ledger, typically data input into a purchase ledger system is:
  • Details of purchase recorded on invoices
  • Details of returns to suppliers for which credit notes are received
  • Details of payments to suppliers
  • Adjustments

Process in a purchase ledger system

The primary action in updating the purchase ledger is adjusting the amounts outstanding on the supplier accounts. These amounts will represent money owed to the suppliers. This processing is identical to updating the accounts in the sales ledger, expect that the sales ledger balances are debts (debtors) and the purchase ledger balances are credits (creditors). Again, the option item approach is the best.

Outputs from a purchase ledger system

Typically outputs in a computerized purchase ledger are as follows.

  • Lists of transactions posted – produced every time the system is run.
  • An analysis of expenditure of nominal ledger purposes. This may be produced every time the system is run or at the end of each month.
  • List of creditor’s balances together with reconciliation between the total balances brought forward, the transactions for the month and the total balance carried forward.
  • Copies of creditors’ accounts. This may show merely the balance b/f, current transactions and the balance c/f. If complete details of all unsettled items are given, the ledger is known as an open-ended ledger.
  • Any purchase ledger system can be used to produce details of payments to be made.
  • Other special reports may be produced for, costing purposes, updating records about fixed assets, comparison with budget, aged creditors list.


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