[GNC] Accounting Modules

[Stephen M. Butler]

On 11/27/18 3:11 PM, David Cousens wrote:
>
> Robert, Geert,
>
> On Tue, 2018-11-27 at 07:46 -0500, Robert Heller wrote:
>> At Tue, 27 Nov 2018 10:13:37 +0100 Geert Janssens <geert.gnucash at kobaltwit.be> wrote:
>>
>>> Op dinsdag 27 november 2018 00:17:06 CET schreef John Ralls:
>>>>> On Nov 27, 2018, at 6:35 AM, Stephen M. Butler <kg7je at arrl.net> wrote:
>>>> The other big issue is that your description of the various modules in a
>>>> business accounting system is for *big* business. That’s not what GnuCash
>>>> is designed for and not what the current development team is interested in,
>>>> never mind (as you point out) capable of supporting. There are a several
>>>> open-source projects in that space, search the web for “foss erp” to find
>>>> them. GnuCash is focussed on very small businesses (as in sole
>>>> proprietorships) and individuals.
>>> I mostly agree, yet I think many small businesses would benefit from a simple
>>> inventory management system. My own business would have for that matter.
>>>
>>> And while inventory is not strictly accounting it would make gnucash a viable
>>> option to quite a few extra small businesses. So I'm in two minds with respect
>>> to inventory support and have been for quite a while. In the past I envisioned
>>> implementing it myself (reusing certain parts of the existing code and adding
>>> the missing bits) but for various reasons shifted to other priorities. If
>>> someone would step in to write it, I would still support the effort though.
>> "Inventory Management" is so close to managing stocks, that it should be
>> possible to implement with bit of recycling/repurposing the existing code for
>> stocks...  One can *almost* fake it now by considering physical inventory as
>> if it were a stock and using a "stock" type account.
> I too have looked at the use of lots in the stock management as a possible basis
> of a basic inventory system. A full cost management system as used in a
> manufacturing business would likely be out of scope for GnuCash but a system for
> managing inventory that is bought and sold would look very similar. The main addition
> would probably be a product table possibly using KVPs for product attributes.
>
>>> Payroll on the other hand is not my cup of tea and likely more targeted at
>>> larger businesses.
>> Yes, a full fledged Payroll module would likely to be major bit of coding, but
>> maybe a simplified small scale Payroll module *might* be of use to smaller
>> businesses (say < 5 employees).
> This a brief illustrative description of what a payroll system has to cover in Australia. I am sure to have left
> something out and some things may have changed since I last employed anyone (2004) or was employed (2013). Perhaps
> gathering similar descriptions for at least some of the major jurisdictions e.g. US, EU, UK GnuCash has to deal with may
> provide a better outline of the scope of such an undertaking and how much is common across various jurisdictions and
> what it might be possible to address within Gnucash.
>
> I had originally envisaged a separate payroll program which exported the appropriate accounting information to GnuCash
> (OFX etc) but maintained its own internal database and records which were payroll specific.
>
> With a payroll system, the number of employees is not really a factor in the coding effort as you have to have the same
> basic facilities in place to deal with a single employee or 100. The only thing that differs is the size of the employee
> database/file not the complexity of its content. I don't think that there is such a thing as a simple payroll system in
> most juridictions.
>
> The most difficult part is setting up a system for deductions of income tax, superannuation etc. and dealing with the
> different conditions for casual, part -time and full time staff. You also have to track employee benefits like annual
> leave, sick leave, parental leave, long term service leave etc, where these often accumulate on the basis of total hours
> worked.
>
> When I used MYOB for calculating my staff salaries I entered the appropriate hourly rates (set by industrial agreements
> and industrial court decisions most of which are now available on-line) and whether casual/part-time/fulltime for each
> individual in an employees record. Most of my staff were casual or part time at the time.
>
> Our tax office provided online calculators based on the total weekly wage for tax deductions. A lot of these
> calculations were based on a table of thresholds and % rates which applied between each threshold and these and the
> calculation methodology were available on the ATO website so they can be included in software. There were also additions
> to the tax based on an income threshold for basic medicare coverage which also had an additional levies for those who
> did not have private hospital insurance.
>
> There were also compulsory superannuation deductions (over a very low threshold) for all employees at a fixed % of gross
> pay. (All employees also had to be covered by compulsory insurance cover for workplace injury and death. This was
> generally in the employers overheads however and not charged to employees.)
>
> A payroll system also has to deal with overtime rates and in Australia at least, penalty rates normally expressed as a
> multiplier of normal pay rates, which applied for work on Saturdays, Sundays and public holidays. They also included
> Time off in Lieu provisions for overtime and penalty rates. A further complication is that these penalty rates were part
> of industrial awards and agreements for specific occupations and sometimes varied considerably between specific
> occupations so all this was all employee specific if you employed people in severl occupational categories and had to be
> tied to each employee's record.
>
> Other common deductions sometimes handled by an employer included:
>      union fees for union members,
>      private health insurance premiums,
>      private superannuation.
>      other life income protection etc insurance premiums.
> These have probably been simplified since most employers now pay net pay directly to an employees bank account and it is
> now much easier for an employee to organize deductions themselves.
>
> To calculate  the payroll, you entered the hours worked by the employee in each category of employment (normal
> hours/overtime hours, various penalty rate categories and the gross pay, tax to be withheld and the deductions to a
> variety of payees were calculated. My bank business account had portal provisions where I could upload a file detailing
> the payments to the employees and various bodies which was then processed electronically by the bank - for which I paid
> a fee naturally. MYOB could create that file (which had to be massaged in Excel for import to the bank) and /or access
> that portal directly if you paid them an extra amount for their electronic banking module.
>
> This will not be not to implement in a way that can deal with differences in the rules and types of calculations used in
> different jurisdictions. Some payments were to our federal government and others wer to state governments depending on
> which administered a particular aspect.
>
> Some calculations depended totally on gross income but some were based on taxable income. The latter is difficult if the
> employee has more than one employer. Often one was specified as the main employer and all other employers were required
> to extract income tax at the maximum marginal rate.
>
> The other bugbear is maintenance. Much of this information changes over time, usually minor adjustments to pay rates,
> but sometimes modifications to thresholds and occasionally the complete method of calculation. As an employer you have
> to stay on top of those changes. I was union friendly and most of my employees were members of a union I had been a
> member of and they provided updates on changes, self interest but it reduced my workload. MYOB had annual updates which
> incorporated such changes for which they charged appropriately
>
> I am sure most other jurisdictions have similar but also different complex systems to deal with.
>
> Underpaying the tax office their share where it was collectable by the employer is of course a punishable civil offence
> should you be caught doing it in an audit. This is an increasing problem with the gig industry in Australia as many such
> businesses think they are somehow exempt from industrial laws or are deliberately ignorant.
>
> David Cousens
Ounch