Definition: Charges are iDempiere’s tool to code a document’s value to a specific general ledger account.

Charges are a powerful concept in iDempiere. They enable you to code value from a document to a specific general ledger account. One of the first questions I get from accountants are “Why do I need a Charge? Why not just let me code it directly to the GL account number?” Here are my answers:

  1. There are times when you need to expose accounting related options to non-accounting folks, and an appropriately named charge is the best solution. An example includes performing cycle counts. When using charges, you can create nicely named options for how to account for variances between what the system thinks and what really exists. The alternative is to expose GL account names like “5430 – Inventory Offsets”.
  2. There are times when you need to create multiple choices for the same GL account. Charges give you the ability to create this many-to-one relationship and still maintain your ability to report on what option the user/document selected. This situation is valuable for expense reports.
  3. Charges give you the ability to map a single user option to multiple accounting schemas. If you need to create financial reports via multiple standards or from multiple entity currencies, using iDempiere’s multiple Accounting Schema capabilities is advantageous. You can define “freight” to go to account XYZ in accounting schema 1, and you can define the same ‘freight” option to go account ABC in schema 2. iDempiere will maintain both accounting schemas simultaneously.

Example Usage – Sales Order

The Sales Order window => Order Line tab is an example where the charge feature is used. On any given order line, you have the option to choose a Product or a Charge. If you choose a charge from the drop down list, the product field grays out.

Charges on a sales order get propagated to the Shipment (Customer) window; however, the charges have no financial impact on the shipment’s posting. This feature represents a convenient way to create special shipping instructions on behalf of the customer.

Gift wrapping is an example situation when you might want to use a charge. By adding gift wrapping charge to an order, you can bill the customer for the service and communicate the instructions to the fulfillment department at the same time. The gift wrapping charge would have no financial impact on the shipment; however, it would recognize the revenue in the account of your choosing when the sales order raises the invoice in the Invoice (Customer) window.

Learning More

If you would like to learn more about Charges, I recommend you try the ERP Academy iDempiere Training program. It combines recorded explanations as well as live discussion about the Charge topic.


One thought on “Charge

Comments are closed.