37 terms a buying committee meets while selecting a finance system, defined without the vendor gloss, each with a note on why it bears on the decision.
An entry that books a cost or a revenue in the period it belongs to rather than the period the cash moves in. If a supplier delivered in March and invoices in April, the March books carry an accrual for the expected amount, which is then reversed or matched off when the real invoice lands.
The record the system keeps of who did what to a transaction and when — who entered it, who changed a field, who approved it, and what the value was before the change. A usable trail is queryable and cannot be edited from inside the application by the people it records.
Agreeing the cash balance in your ledger to the balance the bank reports, and explaining every difference — payments issued but not yet cleared, deposits in transit, bank charges you had not booked. Modern systems import a statement feed and propose matches, leaving a human to clear the exceptions.
Spend on something expected to be useful for more than one period, which is added to the balance sheet and depreciated rather than charged straight to profit. Where the line sits between capitalising and expensing depends on the accounting framework, the policy the business sets, and in some cases on tax rules that differ from both.
The structured list of accounts every posting has to land in — assets, liabilities, equity, income and expense — and the numbering scheme that organises them. It sets the shape of the primary financial statements and, in many older systems, was also forced to carry department, location and product coding inside the account number itself.
A unit of the business that costs are collected against and someone is accountable for — a team, a site, a function. It is a reporting and budgeting construct rather than a legal one, and it does not produce its own statutory accounts.
The window in which you stop transacting in the old system and start in the new one — final balances extracted and loaded, open items brought across, interfaces switched, and the point of no return crossed. It is usually run to an hour-by-hour script over a weekend or a period end.
Moving master data and history out of the old system into the new one — customers, suppliers, items, opening balances, open invoices, and however much transactional history you decide to carry. Almost all of the effort is in cleaning and mapping the data, not in the load itself.
Money you have billed or collected but have not yet earned, held as a liability until you deliver. A twelve-month subscription invoiced up front sits in deferred revenue and is released to the income statement across the term as the service is provided.
Spreading the cost of a long-lived asset across the periods that benefit from it, rather than expensing it all at purchase. The method and useful life chosen determine the charge each period, and the same asset is frequently depreciated differently for statutory accounts and for tax.
Coding attached to a posting alongside the account — department, project, location, product line, funding source — so the same transaction can be analysed several ways without inventing new accounts. Vendors call these dimensions, segments, tags, tracking categories or analysis codes, which are broadly the same idea with different limits.
A model in which an invoice must be submitted to a tax authority's platform and validated before it is legally issued to the buyer, rather than merely reported afterwards. Several countries operate a clearance or pre-clearance regime with their own format, signing and identifier rules; others use post-audit reporting or a network model, and requirements are changing in many jurisdictions.
The detailed record of every capitalised asset — cost, acquisition date, useful life, accumulated depreciation, location and disposal — that supports the single asset figure on the balance sheet. It is a subledger, and it should reconcile to the ledger every period without manual adjustment.
The central record of every posting, organised by account, from which the trial balance and the financial statements are produced. Everything the business does in other modules eventually arrives here, usually summarised, and the ledger is the thing the auditors read.
The record that ordered goods or services actually arrived, entered by whoever received them, against the purchase order that ordered them. It creates the liability for what has been received but not yet invoiced, and it is the second leg of three-way matching.
The consultancy that configures the system, migrates the data and trains the users — often a different company from the one that sells the licence. Vendor directories rank partners by tier, which reflects certifications and sales volume rather than the quality of any particular team.
Removing transactions between entities of the same group so the consolidated accounts show only dealings with the outside world. A sale from one subsidiary to another is real for each entity's own books but is not group revenue, and any profit still sitting in unsold stock has to come out too.
A posting to the ledger, with debits equal to credits, that records something the transactional modules did not already record — an accrual, a reclassification, a correction, an allocation. Manual journals are the finance team's own instrument, which is exactly why they are watched closely.
A company that exists in law, files its own statutory accounts and tax returns, and holds its own set of books. A group is a collection of them, and the reporting structure the business talks about day to day often cuts across the legal one.
The country-specific behaviour a system needs to be usable in a jurisdiction: statutory chart requirements, tax calculation and filing formats, invoice layout and numbering rules, payroll and payment file formats, language, and whatever the local authority mandates electronically. It is supplied by the vendor in some countries and by a partner or third-party add-on in others.
Combining the accounts of several entities into one set of group figures — translating foreign currencies, eliminating internal transactions, and accounting for the share of subsidiaries the group does not own. The mechanics differ under IFRS and various national frameworks, so the reporting standard a group applies shapes what its system has to do.
An architecture in which all customers run the same version of the application, with their data separated logically, and everyone is upgraded together on the vendor's schedule. The alternative — a single-tenant or hosted instance per customer — allows deeper modification and version control at the cost of doing your own upgrades.
The routine that finishes a month, quarter or year: posting the remaining accruals and adjustments, reconciling the subledgers to the ledger, reviewing the results, and locking the period so nothing moves after it is reported. Most finance teams measure it in working days from period end to reported numbers.
Cash paid in advance for something you have not yet consumed — insurance, an annual software subscription, rent — held as an asset and released to expense over the period it covers. It is the mirror image of an accrual.
Tracking revenue and cost against a project rather than only against the ledger — time and expenses booked to a job, work in progress, billing on milestones or on time and materials, and margin per engagement. Services businesses and construction firms usually need it; product businesses often do not.
The document that commits the business to buying something at an agreed quantity and price, issued to the supplier after whatever internal approval the spend requires. It is the authorisation record that later invoices are checked against, and it also gives you a view of committed spend before any invoice exists.
Deciding when and how much revenue to record, which is not the same question as when you invoice or get paid. The prevailing frameworks — ASC 606 under US GAAP and IFRS 15 — work through identifying the contract and its distinct promises, setting a transaction price, allocating it across those promises, and recognising each as it is delivered; local frameworks elsewhere may differ, and any specific treatment is a matter for your auditors.
Splitting a sensitive process so that no one person can complete it alone — the person who sets up a supplier is not the person who approves its invoices or releases the payment. In a system this is expressed as roles and permissions, and as rules about which combinations of them one user may hold.
The filings a business is legally required to produce — annual accounts in the local framework, tax returns, and in many countries periodic electronic submissions in a prescribed format. What is required, in which format, and how often varies substantially by jurisdiction, and management reporting rarely satisfies it as-is.
A detailed ledger for one class of transaction — receivables, payables, fixed assets, stock — that holds the line-by-line records behind a single summary balance in the general ledger. The subledger is where you see which customer owes what; the ledger only shows the total.
Paying an ongoing fee for the right to use software, usually per user per period, as against a perpetual licence bought once with an annual maintenance fee on top. The subscription is an operating cost that continues for as long as you use the system; the perpetual model front-loads the spend and is increasingly hard to buy for cloud products.
The component that decides what tax applies to a transaction — the rate, the jurisdiction, the treatment of a cross-border or exempt sale — and keeps that logic current as rules change. Some systems have a capable one built in; many businesses with complex footprints run a specialist third-party engine alongside.
Checking a supplier invoice against both the purchase order that authorised the spend and the goods receipt that confirms it arrived, before the invoice is approved for payment. All three have to agree on quantity and price, within whatever tolerance you set.
What the system costs over a realistic horizon, not what the licence costs: subscription or licence and maintenance, implementation, integration, data migration, third-party add-ons, infrastructure where relevant, training, and the internal time the project consumes. The last item is usually the largest and the least often written down.
A listing of every account with its balance at a point in time, where total debits equal total credits. It is the working view a finance team reviews before the statements are drawn from it, and the file most often handed to auditors as a starting point.
Running a large system at head office and a lighter one in subsidiaries or newly acquired businesses, with the smaller entities reporting up rather than being migrated onto the corporate platform. It trades the cost and disruption of a full rollout for the work of keeping two systems in step.
The stage where the people who will actually use the system run their own real processes through the configured build and say whether it works, as against the implementer demonstrating that it does. Scripts are written from the business's own scenarios, and defects found here are ranked and fixed before go-live.