Tag Archives: Malaysia

Reinstall MoneyWorks accounting software

Besides using it as a test drive, the trial version can also use to reinstall MoneyWorks when changing new hardware.

Select the appropriate platform (Windows or macOS) and the version you wish to reinstall from the download dropdown list when filling up the request form. You will then receive an email with the download link requested.

Download MoneyWorks Accounting Software
Download MoneyWorks Accounting Software

Enter your license key if reinstalling your Express or Gold version; it does not require a license key to connect to your MoneyWorks Datacentre or access the company file in the MoneyWorks Now cloud server as a client.

Useful information:

How to record a payroll entry?

MoneyWorks is accounting software, not a payroll system; it will not auto-compute the staff salary (e.g. bi-monthly part-timer’s hourly wages or change of CPF contribution according to the employee’s age). A payroll system or a spreadsheet (if it is simple) will do a better job than an accounting system. 

Of course, although the accounting system does not compute payroll, you still have to record the monthly payroll via a general journal or payment transaction to update the ledger.

If you are entering the payroll in a lump sum via a general journal, then the journal could be:

DR. Salary expense (PL)
DR. CPF employer contribution (PL)
     CR. Accrued CPF payable (BS)
     CR. Accrued salary or the bank account (BS)

CPF, the Central Provident Fund, is like the Social Security fund in some countries. The contribution rate will change according to the employee’s age. The employer contribution is a company expense, whereas the employee contribution is deductible from the employee’s salary. Both CPF contributions will be accrued together with the SHG funds and paid out to the CPF Board on the next due.

SHG funds (Self-help group funds) include:

  • Chinese Development Assistance Council (CDAC) Fund
  • Mosque Building and Mendaki Fund (MBMF)
  • Eurasian Community Fund (ECF), and
  • Singapore Indian Development Association (SINDA) Fund.

Assuming the monthly payroll for the company is:

Salary: 10,000
CPF Employer (17%): 1,700
CPF Employee (20%): 2,000
Self-help group funds: 2

Then, the general journal will be:

DR. Salary (PL): 10,000
DR. CPF Employer (PL): 1,700
     CR. Accrued CPF (BS): 3,702
     CR. Accrued salary or the bank account (BS): 6,298

Credit the accrued salary account instead of the bank account, and then use a payment transaction to pay the employee individually with the accrued salary account to facilitate the bank reconciliation later. Of course, you should consider setting a security level on those payroll-related accounts to prevent unauthorised MoneyWorks users from viewing the transaction history.

Set the account security level
Setup Security Level

Payment transaction method

You may also consider using a payment transaction to enter the monthly payroll of each employee instead of using a general journal to record the payroll for the month in a lump sum. This method works if you prefer to view the ledger detail by the employee.

Assuming you have two employees. 

Employee A:
Salary: 3,000
CPF employer contribution (17%): 510
CPF employee contribution (20%): 600
SHG fund: 1

Employee B:
Salary: 4000
CPF employer contribution (17%): 680
CPF employee contribution (20%): 800
SHG fund: 1

To enter the employee payroll for the month, you have to add the expense and less the accrual within a payment transaction. In the payment transaction, select the appropriate bank account and payee, and in the detail section, enter as:

Row1: Salary expense: 3,000
Row2: CPF employer contribution: 510
Row3: Accrued CPF payable: -510 (for CPF employer contribution)
Row4: Accrued CPF payable: -600 (for CPF employee contribution)
Row5: Accrued CPF payable: -1 (for SHG funds deduction)

So, the transaction gross for the payment will be 2,399.00

Payroll payment transaction
Payment transaction

You can enter all the accrued CPF payable into a single row (lump sum) or multiple rows as in my above example, but having rows with descriptions separating different type of deduction facilitate inquiry and printing reports. 

Assuming you wish to print a report by the employee by account. You can first create an account inquiry, then shortlist the employees or transactions and print the list with subtotal by the employee.

Payroll report. By employee by account.
By employee by account report

A payroll system will be more complex in reporting, and more features available (e.g. adjusting CPF rate based on the employee age, calculating the hourly wage for each employee, etc.). Using an accounting system for recording payroll may be workable for those SOHO or small businesses with fewer employees or require only basic payroll entry.

Do visit the Cognito website if your development team would like to integrate the payroll system with MoneyWorks accounting software, or engage a MoneyWorks consultant if you wish to import transactions into the accounting system.

How to record retention in QuickBooks?

Retention is money withheld by the customer of a contract (project); protect the customer against incomplete or defective works. The retained sum is usually released to the supplier once the project ends or after the warranty period.

Assuming the sum withheld is at every stage of the progress claim. For a progress claim of $100,000 with 5% retention, the journal behind the sales invoice will be:

DR. Accounts Receivable $101,650
DR. Retention Receivable $5,000
CR. Sales $100,000
CR. GST Payable: $6,650

To record the retention in QuickBooks Online, first, you create a retention item (can be a service item) and link it to the retention receivable (a current assets account). Then, use it in the invoice with a negative value to reduce the invoice total (the objective is to reduce the receivable and not the revenue).

To view the retention receivable, you may run a report for the retention receivable account (from the Chart of Accounts) and group it by the customer to check the retained sum by the customer or for a job (if you are using the project feature in QuickBooks Online).

QuickBooks Retention Report
Retention – Quick Report

You may then issue an invoice to the customer for the retained sum once the project ends. The journal for the invoice:

DR. Accounts Receivable $5350
CR. Retention Receivable $5000
CR. GST Payable $350

QuickBooks Online is a small business account system suitable for small businesses and SOHO. Although it does not have a complex project accounting feature, it should be sufficient for basic project tracking.

Note:

  1. The letter of claim is not a tax invoice, and the retained amount has to account for the GST upon payment received or invoice issued, whichever earlier.
  2. To create an account in QuickBooks Online (QBO):
    • Click on the Gear icon and select Chart of Account from the list.
    • Click on the New button in the Chart of Account list to add an account.
  3. To create an item in QuickBooks (QBO):
    • Click on the Gear icon and select Products and Services.
    • Click on the New button in the Products and Services list to add an item.