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Unit 5 – Masters 79

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Unit 5 – Masters 79

Securities & Deposits (Assets)

Stock-in-Hand

Sundry Creditors

Sundry Debtors

Suspense Account

Unsecured Loans

All the 29 default Account Group masters are pre-defined (See topic 5.1.1) Account Group masters. Pre-defined Account Groups in BUSY, are based on the common requirements of the Indian Accounting System.

Classification of Account Groups

Pre-defined Account Groups are classified in primarily two categories:

Primary – These Account Groups represent the top-most level in the hierarchy of Account Groups.

Secondary – These Accounts Groups are grouped under the Primary Groups. For example, Cash-in-Hand is a secondary group under the Current Assets Primary Group.

Importance of Classifying Account Groups

The flexibility of creating sub-groups under the groups according to your requirements helps in organizing large number of accounts in a systematic manner. This in turn enhances the information system in the organisation. For example, you can divide your sundry debtors according to the region where their office is located. Thus, you can create various Account Groups as North Delhi Debtors, East Delhi Debtors, South Delhi Debtors and West Delhi Debtors under the Account Group Sundry Debtors. This will help you in viewing report for a single debtor, for all the debtors of East, West, North or South Delhi and for all the debtors of Delhi region.

è Classification of Account Groups should be governed by the needs of your organization. Use

this facility of grouping various Account Groups judiciously. Do not create unnecessary

Key Points while classifying Account Groups

hierarchy in account groups since it can lead to confusion.

Given here are the key points to be kept in mind when you are creating Account Groups.

Create accounts for income or expenditure under the Revenue Accounts Account Group only. The reason is that only the Revenue Accounts Account Group and Stock-in-Hand Account Group affect the Profit & Loss account of the company.

Create tax related accounts under the Duties & Taxes Account Group. The basic functionality of Duties & Taxes Account Group is to maintain accounts for Sales Tax, VAT and other such liabilities of the company towards the government.

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Create a Sundry Debtor or Sundry Creditor account based on the type and the frequency of transactions that you carry out with the party.

è BUSY does not distinguish between Sundry Debtors and Sundry Creditors while entering the Sales or Purchase vouchers. Thus, you can enter both Sales and Purchase voucher for Sundry Debtors and Sundry Creditors.

Given here is a diagram of the hierarchical representation of the Account Groups.

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