Payable Header Level Posting (HLP)

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Overview

Accounting Seed supports two methods of posting Billings and Payables: Header Level Posting (HLP) and Line Level Posting (LLP). There are significant advantages to adopting HLP, which includes the following:

The reduction of data usage
The reduction of clutter in the AP Control GL Account
The ability to include Payable Line Level tax calculations by using a Tax Group. For more information, refer to the Set up AS Native Tax article.

With Payable LLP, once a Payable is posted, the Payable Line record creates a pair of transactions for each Payable Line:

The debit entry is made to the GL Account that is set in the Expense GL Account field on the Payable Line
The credit entry is made to the AP Control GL Account that is set in Default GL Accounts.

Each Payable Line will repeatedly post to the AP Control GL Account. This can result in an inefficient number of credit transactions created to the AP Control GL Account. Additionally, there will be numerous credit transactions from each line cluttering your AP Control GL Account. For example, with Payable LLP, if you have a Payable with 500 lines, this will result in 1000 transactions to the General Ledger, of which 500 will post to Accounts Payable. Under Payable HLP, you would have 501 transactions to the General Ledger, of which only one transaction will be posted to Accounts Payable.

Under Payable HLP, the credit to the AP Control GL Account does not inherit any of the Payable Line dimension characteristics, i.e., the GL Variable 1-4, Product, Project, Project Task, or the Quantity. As a result, the GL Variable 1-4 filters will not display on the following Accounting Seed Financial Reporter statements:

Balance Sheet
Trial Balance
Cash Flow Statement

The filters will not display because these reports include the AP Control GL Account and you cannot filter by GL Variable 1-4 since none of the credits to this GL Account have this information.

Note: To create GL Variable 1-4 filtered reports on Financial Statements, use the Custom Reporter, but note that this same limitation applies.

For industries such as, “Not For Profits” that need to segment Balance Sheet accounts by dimension (i.e., GL Variable 1-4), Payable LLP would be a more suitable option.

With Payable HLP, the number of posted transactions for Payables can be reduced in the following two ways:

A debit transaction is created for each unique combination of the following dimensions:
-- Expense GL Account
-- GL Variable 1-4
-- Product
-- Project
-- Project Task.
Only one credit transaction to the AP Control GL Account will be posted for all of the Payable Lines that are associated with a Payable record.

Note: Payable HLP is supported for Multi-Currency users.

Note: For users of Accounting Seed’s Orders and Inventory module, Payable HLP is available to be used with the Weighted-Average Cost system. It is not available if you are using the Standard Cost version of the Orders and Inventory module. If you wish to migrate, please contact Customer Support.

Do you want to view one of the following:

Sample Payable Record without a Tax Amount
Sample Payable Record - Accounting Transactions without a Tax Amount
Sample Tax Group and Tax Rate Information
Sample Payable Record with a Tax Amount
Sample Payable Record - Accounting Transactions with a Tax Amount

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Sample Payable Record without a Tax Amount

Payable Record: 0005
Payable Line	Product	Expense GL Account	Qty	Amt	Tax Group	Tax Amount	Total	GLAV 1-4	Project	Project Task
APL-1000	Control Panel	5000-Product Expense	1.00	$100.00	---	---	$100.00	---	---	---
APL-1001	Control Panel	5000-Product Expense	1.00	$200.00	---	---	$200.00	---	---	---
APL-1002	Control Panel	5000-Product Expense	3.00	$450.00	---	---	$450.00	Dept A	---	---
APL-1003	Control Panel	5000-Product Expense	4.00	$600.00	---	---	$600.00	Dept A	---	---

Sample Payable Record - Accounting Transaction without a Tax Amount

Based upon the Sample Payable record above, with Payable HLP, only three transactions will be posted to the GL. For the debit side of the entry, the Expense GL Account is the same for all four of the Payable Lines. However, there are some differences in the GLAV 1-4 dimension. On the first two Payable Lines, no department is listed. But, on the last two Payable Lines, Department A is listed. Therefore, two debit transactions will be posted based upon the two unique dimension combinations.

Expense GL Account = 5000-Product Expense

GLAV 1-4 = No department specified, with a total amount of $300.00

Expense GL Account = 5000-Product Expense

GLAV 1-4 = Department A, with a total amount of $1,050.00

Accounting Transactions
TRN	Product	Expense GL Account	Qty	Amount	GLAV 1-4	Project	Project Task	Account	Payable
TRN - 01	Control Panel	5000-Product Expense	2.00	300.00	---	---	---	Alpha Comm	0005
TRN - 02	Control Panel	5000-Product Expense	7.00	1,050.00	Dept A	---	---	Alpha Comm	0005

There will be one transaction to credit the AP Control GL Account, which is the total of $1,350.00.

$100.00 + $200.00 + $450.00 + $600.00 = $1,350.00 (total amount)

Accounting Transactions
TRN	Product	GL Account	Qty	Amount	GLAV 1-4	Project	Project Task	Account	Payable
TRN - 03	---	2000-AP Control GL Account		(1,350.00)	---	---	---	Alpha Comm	0005

Note: Click here to view the above image in full screen.

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Sample Tax Group and Tax Rate Information

For information on how to set up a Tax Group and add a Tax Rate(s), refer to the Create a Tax Group article.

Tax Rate Name	Tax Type	Tax Rate GL Accounts		Tax Group A	Tax Group B
		Purchase Tax Expense GL Account	Sales Tax Liability GL Account
Tax Rate 1	Purchase	6000-DC Tax Expense		5.000%
Tax Rate 2	Purchase	6000-DC Tax Expense		2.000%
Tax Rate 3	Purchase	6000-MD Tax Expense		3.000%
Tax Rate 4	Purchase	6000-MD Tax Expense		1.000%
Tax Rate 5	Purchase	6000-MD Tax Expense		2.000%
Tax Rate 6	Sales & Purchases	6000-MD Tax Expense	2501-MD Tax Liability		3.000%
Tax Rate 7	Sales & Purchases	6000-MD Tax Expense	2501-MD Tax Liability		1.000%
Combined Tax Rate				13.000%	4.000%

The Combined Tax Rate for Tax Group A includes all of the rate percentages that are in Tax Rates 1-5 (5.000% + 2.000% + 3.000% + 1.000% + 2.000% = 13.000%). The Combined Tax Rate for Tax Group B consists of the two percentage rates that are in Tax Rate 6 and 7 (3.000% + 1.000% = 4.000%).

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Sample Payable Record with a Tax Amount

Payable Record: 0005
Payable Line	Product	Expense GL Account	Qty	Amount	Tax Group	Tax Amount	Total	GLAV 1-4	Project	Project Task
APL-1000	Control Panel	5000-Product Expense	1.00	$100.00	Grp A	$13.00	$113.00	---	---	---
APL-1001	Control Panel	5000-Product Expense	1.00	$200.00	Grp B	$8.00	$208.00	---	---	---
APL-1002	Control Panel	5000-Product Expense	3.00	$450.00	Grp B	$18.00	$468.00	Dept A	---	---
APL-1003	Control Panel	5000-Product Expense	4.00	$600.00	Grp B	$24.00	$624.00	Dept A	---	---

Sample Payable Record - Accounting Transactions with Tax Amount

Based upon the Sample Payable record above, with Payable HLP, for the debit side of the entry, the Expense GL Account is the same for all four of the Payable Lines. However, there are some differences in the GLAV 1-4 dimension. On the first two Payable Lines, no department is listed. But, on the last two Payable Lines, Department A is listed. Therefore, two debit transactions will be posted to the Expense GL Account based upon the two unique dimension combinations.

Expense GL Account = 5000-Product Expense

GLAV 1-4 = No department specified, with a total amount of $300.00

Expense GL Account = 5000-Product Expense

GLAV 1-4 = Department A, with a total amount of $1,050.00

Accounting Transactions
TRN	Product	Expense GL Account	Qty	Amount	GLAV 1-4	Project	Project Task	Account	Payable
TRN - 01	Control Panel	5000-Product Expense	2.00	300.00	---	---	---	Alpha Comm	0005
TRN - 02	Control Panel	5000-Product Expense	7.00	1,050.00	Dept A	---	---	Alpha Comm	0005

For the tax amount, Payable Line 1000 is in Tax Group A, which includes two different Purchase Expense GL Accounts. Refer to the Sample Tax Group and Tax Information table. Payable Line 1001 is in Tax Group B, which has the same MD Purchase Tax Expense GL Account as Tax Rates 3-5 under Tax Group A. Therefore, the Tax Group B portion of these two Payable Lines (APL 1000 and APL 1001) can be combined into one transaction. The debit transactions for purchase tax will require three separate transactions.

Purchase Tax Expense = 6000-DC Tax Expense

GLAV 1-4 = None

Tax Group A - Tax Rate 1, 5.00% + Tax Rate 2, 2.00% = 7.00%
$100.00 X 7.00% = $7.00

Purchase Tax Expense = 6001-MD Tax Expense

GLAV 1-4 = None

Tax Group A - Tax Rate 3, 3.00% + Tax Rate 4, 1.00% + Tax Rate 5, 2.00% = 6.00%
$100.00 X 6.00% = $6.00
Tax Group B - Tax Rate 6, 3.00% + Tax Rate 7, 1.00% = 4.00%
$200.00 X 4.00% = $8.00

Purchase Tax Expense = 6001-MD Tax Expense

GLAV 1-4 = Department A

Tax Group B - Tax Rate 6, 3.00% + Tax Rate 7, 1.00% = 4.00%

$1050.00 X 4.00% = $42.00

Accounting Transactions
TRN	Product	Expense GL Account	Qty	Amount	GLAV 1-4	Project	Project Task	Account	Payable
TRN - 03		6000-DC Tax Expense		7.00	---	---	---	Alpha Comm	0005
TRN - 04		6001-MD Tax Expense		14.00	---	---	---	Alpha Comm	0005
TRN - 05		6001-MD Tax Expense		42.00	Dept A	---	---	Alpha Comm	0005

There will be one transaction to the credit AP Control GL Account, which is the total of $1,413.00.

$100.00 + $200.00 + $450.00 + $600.00 = $1,350.00 (subtotal amount) + $63.00 (tax amount) = $1,413.00

Accounting Transactions
TRN	Product	GL Account	Qty	Amount	GLAV 1-4	Project	Project Task	Account	Payable
TRN - 06	---	2000-AP Control GL Account		(1,413.00)	---	---	---	Alpha Comm	0005

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When Payable Header Level Posting is enabled, keep the following points in mind:

The debit transaction(s) consolidates any Payable Line that has the same dimensions, i.e., the
-- Expense GL Account
-- Product
-- Project
-- Project Task
-- GL Variable 1-4.
The credit AP Control GL Account will NOT include a sum of the Payable Line Quantity. The debit to the Payable Lines will include the sum of the Payable Line Quantity.

Title

Payable Header Level Posting (HLP)

URL Name

835237500