Orobooks organizes accounts into three hierarchical levels for better categorization and financial reporting:

• Account Type – The highest level of classification, defining the fundamental nature of an account.
• Account Category – A more specific grouping under each account type.
• Account Subtype – A further breakdown within each category to provide detailed classification.

1. Account Type
There are five main account types in Orobooks:

• Income – Represents revenue earned by the business.
• Expense – Tracks costs incurred by the business.
• Asset – Includes resources owned by the business, such as cash and receivables.
• Liability – Represents obligations or debts owed to others.
• Equity – Captures the owner’s stake in the business.

Each account type serves a distinct role in financial reporting and is essential for accurate bookkeeping.

2. Account Category

Within each Account Type, Orobooks provides predefined Account Categories to ensure structured organization. For example, predefined account categories under the Income account type include Sales of Product Income, Service Income, and Other Income, among others. Each Account Category helps group similar accounts for streamlined financial tracking and reporting.

3. Account Subtype
For even greater detail, certain categories offer further Account Subtypes.

• For example, Expense accounts include over 25 different subtypes to allow precise categorization.
• This level of classification is particularly useful for expense tracking and tax reporting.

When setting up your Chart of Accounts, carefully choose Account Categories and Subtypes to ensure proper classification that aligns with your organization’s financial needs.

** Important Note **

• Users cannot manually select an Account Type.
• When choosing an Account Category, the system automatically assigns the corresponding Account Type based on predefined mappings.

This automated classification helps maintain consistency and simplifies account setup.

You should set an opening balance for a new account in Orobooks in the following situations:

1. Migrating from Another Accounting System

If you are switching from another accounting software or spreadsheet to Orobooks, you will need to enter the opening balances of your Asset and Liability accounts as they were at the time of migration. This ensures continuity in your financial records.

• No opening balances are needed for Income or Expense accounts, as they track financial activity over time rather than carrying forward balances.
• Equity accounts do not require an opening balance either. Instead, Orobooks uses the Opening Balance Equity - Default (OBE) account as a temporary holding account during migration.

To facilitate a smooth transition, Orobooks uses a special account called Opening Balance Equity - Default (OBE):

• Any opening balances recorded for Asset or Liability accounts are temporarily offset against the OBE account.
• The remaining balance in the OBE account reflects the organization's net equity at the time of migration.
• After all asset and liability balances are entered, the OBE balance can be transferred to other equity accounts (e.g., Retained Earnings) to ensure accurate financial records.

2. Setting Up an Account for Historical Purposes

If you need to track past balances that were not previously recorded—such as an outstanding loan from a prior year—you should enter the opening balance to reflect the current balance of that account.

An opening balance is not needed in the following situations:

• For accounts with no existing balance – If the account starts with a zero balance, Orobooks automatically considers it a new account with a $0 starting point, so no opening balance is required.
• For income and expense accounts – These accounts track financial activity over time and do not carry forward balances. Therefore, an opening balance is not necessary.

Migrating to Orobooks is a straightforward process. Follow these steps to ensure a smooth transition. Here is a video demonstrating a migration example for reference Watch Video.

1. Select a Migration Date

Choose a migration date—ideally at the beginning of a quarter, month, or year—to simplify the transition and maintain clean financial records.

2. Prepare a Balance Sheet

Generate a balance sheet as of your migration date, listing all Asset, Liability, and Equity accounts along with their respective balances.

3. Set Up Your Chart of Accounts in Orobooks

Orobooks automatically creates three default accounts with a zero balance for each organization:

• Accounts Receivable - Default: Tracks customer invoices.
• Accounts Payable - Default: Tracks vendor bills.
• Opening Balance Equity - Default (OBE): Temporarily holds migrated opening balances.

In addition to these default accounts, create any additional accounts needed to match your balance sheet. Navigate to Accounts > Create Account to add them.

4. Enter Opening Balances for Asset and Liability Accounts

For each Asset and Liability account, enter the closing balance as of your migration date as the opening balance in Orobooks.

When you set an opening balance for an Asset or Liability account, Orobooks automatically updates the balance in the Opening Balance Equity - Default (OBE) account.

5. Review and Adjust Equity Accounts

Once all Asset and Liability balances have been entered:

• The OBE account will reflect your organization’s total net equity at the time of migration.
• Transfer balances from the OBE account to the appropriate Equity accounts (e.g., Retained Earnings) to restore their correct balances.

6. Set Up Income and Expense Accounts

For Income and Expense accounts, create them without any opening balances—set them to zero since they track financial activity over time rather than carrying forward balances.

You cannot delete an account in Orobooks, but you can deactivate it.

• Deactivating an account prevents it from being used in new transactions while preserving its historical data. All past transactions associated with the account are retained and remain accessible for reporting purposes.

If needed, you can reactivate a deactivated account:

• Once reactivated, the account becomes available for new transactions again and its historical records are retained.

When creating an Asset or Liability account, you may set an opening balance to track its historical data. If the opening balance was entered incorrectly, you can reverse it by following these steps:

1. Navigate to General Ledgers > Create General Ledger.
2. Debit the account in question and credit the Opening Balance Equity - Default account.
3. To maintain consistency, set the Entry Date to match the Start Date of the account creation.
4. Once the adjustment is made, the account’s balance will be reset to zero.

If needed, you can also deactivate the account after making this adjustment.

Orobooks categorizes different entities to help businesses track financial transactions accurately.

Customers are individuals or businesses that purchase goods or services. They are used for:

• Invoicing, invoice payments, customer credits, and refunds
• Tracking sales revenue and accounts receivable

When creating an invoice, a customer must be selected to associate revenue and accounts receivables with that customer.

Vendors are suppliers or service providers the company purchases from. They are used for:

• Tracking bills, expenses, accounts payable, and purchase history
• Recording and managing bill payments

When entering a bill, a vendor must be selected to track expenses and accounts payables.

Employees are individuals who work for the company. In Orobooks, employees are currently used for:

• Employee reimbursements and expense tracking

Other entities include individuals or organizations that do not fall under customers, vendors, or employees, such as owners, investors, or partners.

For example, dividend payments to investors are recorded as equity distributions.

The Generate Report link in Entities > Customer List creates a PDF report for a selected customer over a specified time period. The report includes:

• Advance payments made by the customer
• Customer credits issued
• Customer refunds issued
• Invoices and corresponding customer payments
• Unpaid or partially paid invoices
• Net accounts receivable from the customer

This report provides a comprehensive summary of the customer's financial transactions and outstanding balances.

When you create an invoice through Invoices > Create Invoice, the Accounts Receivable - Default account is automatically debited, even though the debit account is not shown in the form. This approach centralizes all invoice-related debits, making it easier to track invoices and their corresponding accounts receivable.

It is considered best practice to track all income from customers through the invoice function to ensure that all income and accounts receivable data are complete and accurate.

In the Invoices > Invoice List, each invoice has options under the View column:

• PDF button: Downloads a PDF version of the invoice for review or archival purposes.
• Email PDF button: Sends an email to the invoice's customer with the invoice attached as a PDF.

Before using the Email PDF option, ensure that the customer has a valid email address on file. You can review or update the customer's details by navigating to Entities > Customer List > View or Edit.

To record a customer advance payment:

• First, create a Liability account (e.g., Customer Advance Payments) with the Account Category set to Other Current Liabilities and the Account Subtype to Advance Payments.
• Then, record the advance payment by navigating to Invoices > Enter Advance Payment, and credit the Customer Advance Payments (Liability) account.
• The advance payment can be used to pay off unpaid or partially paid invoices from the customer.

To record a customer credit:

• Create a Liability account (e.g., Customer Credits) with the Account Category set to Other Current Liabilities and the Account Subtype to Customer Credit.
• Record the issued credit by going to Invoices > Issue Customer Credit, and credit the Customer Credits (Liability) account.
• The customer’s credit can be applied to settle any unpaid or partially paid invoices from the customer.

A customer can pay an invoice using a direct payment, an advance payment they made earlier, or a customer credit they have available.

For direct payment:

To record a direct payment, go to Invoices > Record Payment on Invoice and enter the transaction details.

For advance payment:

To apply an advance payment, navigate to Invoices > Apply Advance Payment to Invoice. Ensure that the advance payment and invoice are associated with the same customer. Do not mix advance payments and invoices from different customers.

For customer credit:

To apply a customer credit, go to Invoices > Apply Customer Credit to Invoice. Again, make sure the customer credit and the invoice are for the same customer. Do not mix customer credits and invoices from different customers.

A customer refund can only be issued if the customer has available customer credits. To process a refund:

1. Go to Invoices > Issue Customer Refund.
2. Select an available customer credit for the customer.
3. Record the transaction.

When you create a vendor bill through Bills > Enter Bill, the Accounts Payable - Default account is automatically credited, even though the credit account is not displayed in the form. This ensures that all vendor bills are centralized in accounts payable, making it easier to track outstanding liabilities.

Each bill also requires a debit account, such as an expense account, which must be selected when entering the bill.

Using the bill function to record vendor expenses helps maintain accurate expense tracking and accounts payable balances, ensuring a clear record of outstanding vendor obligations.

To record a vendor bill payment:

1. Navigate to Bills > Pay Bill.
2. Select the vendor bill from the dropdown list.
3. Choose a Bill Payment Account (typically a bank account).
4. Enter the bill Payment Amount and Payment Date.
5. Click Submit to complete the transaction.

Once the payment is recorded:

• The Accounts Payable - Default account is debited (reducing the liability).
• The selected Bill Payment Account is credited (reducing cash or bank balance).

To record an employee reimbursement:

1. Navigate to Reimbursements > Enter Employee Reimbursement.
2. Select the employee from the dropdown list.
3. If the employee is not listed, go to Entities > Add Employee to add them.
4. Select a Debit Account (an Expense account).
5. Select a Credit Account (a bank account).
6. Fill out the remaining fields:
• Processed Date: The date the reimbursement was paid to the employee.
• Submitted Date: The date the employee submitted the reimbursement request.
7. Optionally, you can upload an attachment, such as a receipt.
8. Click Submit to complete the transaction.

Once the reimbursement is recorded:

• The selected expense account is debited (increasing expenses).
• The selected bank account is credited (reducing cash or bank balance).

In Orobooks, every transaction generates a pair of general ledger entries to ensure balanced accounting.

• You can review all general ledger records by date range and/or account by navigating to General Ledgers > General Ledger List.
• Records can also be downloaded in CSV format for further analysis.

For manually created general ledger entries (added via General Ledgers > Create General Ledger):

• A Void button is available in the Actions column, allowing you to void these entries if needed.
• However, system-generated general ledger entries cannot be voided to maintain data integrity.

You can manually create a pair or multiple pairs of general ledger entries by navigating to General Ledgers > Create General Ledger.

When selecting Debit and Credit accounts, certain rules apply to ensure proper tracking of accounts receivable and accounts payable:

• If either account is Accounts Receivable - Default, the entry must be associated with a customer to maintain accurate receivable records.
• If either account is Accounts Payable - Default, the entry must be associated with a vendor to ensure complete tracking of payables.

The form allows users to enter one to four entries at a time to facilitate faster data entry.

After creating the entries, you can review them by navigating to General Ledgers > General Ledger List.

Manually created entries can be voided by clicking the Void button in the General Ledger List.

To record depreciation and amortization, follow these steps:

1. Choose a Depreciation Method

Common depreciation methods include:

• Straight-Line Depreciation – Spreads the expense evenly over the asset’s useful life.
• Declining Balance Depreciation – Allocates a higher expense in the early years and reduces over time.

For simplicity, we will use the Straight-Line Method.

2. Calculate Depreciation

For example, if you purchase a fixed asset for $10,000 with a useful life of 5 years (60 months):

• Annual depreciation expense = $10,000 ÷ 5 years = $2,000 per year
• Monthly depreciation expense = $10,000 ÷ 60 months = $166.67 per month

3. Set Up Accounts for Depreciation

Create two accounts:

• Depreciation Expense (Expense account) – In Orobooks, select Expenses as its account category.
• Accumulated Depreciation (Contra asset account) – In Orobooks, select Fixed Assets as its account category.

Accumulated Depreciation reduces the value of the fixed asset on the balance sheet without affecting the original asset cost.

4. Record Monthly Depreciation Entry

Each month, post the following journal entry:

        Debit: Depreciation Expense       $166.67  
        Credit: Accumulated Depreciation  $166.67  
            

Depreciation Expense increases, reducing net income. Accumulated Depreciation offsets the asset’s book value on the balance sheet.

5. Continue Depreciation Until the Asset is Fully Depreciated

• Post this journal entry each month for 60 months.
• After 5 years, total accumulated depreciation will be $10,000, reducing the asset’s net book value to $0, unless there is a residual value.

6. Recording Amortization

Amortization follows a similar approach to depreciation, but it applies to intangible assets (e.g., patents, trademarks).

The journal entry for amortization is:

        Debit: Amortization Expense       $XXX.XX  
        Credit: Accumulated Amortization  $XXX.XX  
            

Amortization Expense records the cost allocation, while Accumulated Amortization reduces the intangible asset’s book value.

To grant access to another user:

1. Navigate to Settings > Invite User.
2. Enter the user's email and send an invitation.
3. The user will receive an email with a registration link.
4. Once registered, the user will have full access to your organization’s data.

To disable a user's access:

1. Go to Settings > User Management.
2. In the Action column of the user list, click Deactivate to revoke access.

Note: If a user registers with Orobooks without an invitation, they will not have access to your organization’s data. Instead, they will start a new book for a new organization.

No, your username and email address cannot be changed in Orobooks.