After you have your business up and running on Odoo accounting, your single best resource is the accounting journal. Whatever it is that you are monitoring in terms of purchases, sales, or expenses, journals are your business transaction ledgers. In this tutorial, we will lift the veil on what the account journals in Odoo accounting are, how to construct and install them, and how to use them so that your books are workable.

What are Odoo Accounting Journals?

Before exploring how to deal with accounting journals, let’s first see what they are and why they matter in Odoo accounting.

What is an Accounting Journal?

An Odoo journal of accounts is a ledger book of financial records of a company. It is a journal book with detailed recordings where all financial transactions are accounted for before being posted to the general ledger account. The journal captures all business transactions from sale and purchase up to banks.

All journal postings in Odoo have:

  • Transaction Date: Date of transaction
  • Accounts Involved: Debiting account and credit account
  • Transaction Amount: Financial value of the transaction
  • Description: Short description of the transaction

Various Types of Journals in Odoo

Odoo provides various pre-configured journals to account for various types of transactions. Some of the most widely used ones are:

  • Sales Journal: To account for sale transactions.
  • Purchase Journal: To account for purchase transactions of goods or services.
  • Bank Journal: Accounts for bank account transactions, for example, deposits and withdrawals.
  • Cash Journal: To account for cash transactions in your business.
  • Payroll Journal: For recording accounting payroll transactions, i.e., employees’ salaries and benefits.
  • Miscellaneous Journal: For recording any other transaction that is not to be recorded in the given types of transactions.

All these are purpose-based journals, and Odoo also offers you the facility to plan or create a new journal according to your very own business requirements.

Creating and Setting up Accounting Journals in Odoo

Now that you have an idea of what are journals in accounting, let us go ahead further to learn how to create and configure journals in Odoo accounting as per your requirement.

How to Create a New Journal

It is not a complicated task to create a new journal in Odoo. Follow the below steps to go ahead:

  1. Go to Accounting Module: Position yourself on the Odoo Accounting dashboard.
  2. Click on “Journals“: In the menu, find and select “Journals.”
  3. Click “Create“: You will now have an empty form to fill your new journal into.
  4. Select Journal Type: Select the journal type (e.g., Sales, Purchase, Bank, etc.).
  5. Specify Journal Parameters:
    • Give the journal a name
    • Specify the default debit account
    • Specify whether it’s an automatic or manual journal

Configuring Journal Settings

After you’ve set up your journal, you must set up its parameters. Here’s how:

  • Sequence Configuration: Journals require a configuration of the sequence so that entries are saved in sequence. Odoo will automatically number your entries according to this sequence.
  • Default Accounts: Default debit and credit accounts must be defined for every journal. These can be defined beforehand for normal transactions to avoid mistakes and save time.
  • Personalize Journal Entries: If you want something special for your business, you can also personalize the journal by adding more categories or sub-accounts. For instance, if you are handling a particular customer on a regular basis, you can make him a personalized journal.

Managing Accounting Journals in Odoo

Now that your journals are available, it’s time to lay hands on them. Below are the fundamentals you have to know to make use of your journals.

Editing, Copying, or Deleting Journals

You will one day be editing your journals. Below is how you do that:

  • Editing a Journal: Choose the journal you want to edit, do what you want to change, and click on “Save” to save it.
  • Copy Journals: To copy the journal, you simply click on “Copy” to make a copy of the current journal settings and go and adjust as desired.
  • Removing Journals: You can remove a journal as well, but note that it will remove all similar-journal transactions as well. You will be asked to confirm that the journal is no longer necessary before removing.

Organizing Your Journals

Journal organization helps you keep your books in order. Among the tips that you can use in attempting to stay organized are:

  • Categorize Transactions: Have the transactions kept in their own journal. Sales transactions, for instance, are kept under the Sales Journal while purchases are kept under the Purchase Journal.
  • Link Journals to Specific Transactions: You can link your journals to specific sections of your business. Your Payroll Journal would be linked to your employees’ transactions, and your Bank Journal would be linked to all bank transactions, for instance.
  • Use Descriptions to Clarify: Don’t leave the description columns blank on all journal entries. This is particularly useful in classifying transactions and providing additional information for future use.

Balancing and Reconciling Journals

Another of the key things to realize about balancing your journals is that they will need to balance. Odoo needs a credit and a debit on each journal entry, and the two should always be the same.

 

  • Automatic Reconciliation: Odoo automatically reconciles some of its transactions like payments against invoices. When you are paying against an invoice, Odoo will automatically journal the payment.
  • Manual Reconciliation: if automatic reconciliation has not been performed, then you can even perform it manually. You just have to go through the entries and balance all accounts.

Conclusion

Odoo accounting journal management is an essential component of keeping your business accounts current. Creating the proper journals, balancing transactions in the correct way, and posting entries in balance keeps your finances current and accurate.

Having your Odoo accounting journals under management by the step-by-step tutorial in this lesson will place you in control of your finances and keep your company running smoothly.

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