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IMPLEMENTATION OF INTUIT QUICKBOOKS IN
PT. TRISAN PAKAR BAJA
SKRIPSI
Presented in partial fulfillment of the requirements for The Bachelor’s
Degree in Accounting
By
Roy Bratakusuma Uni
008201500027
FACULTY OF BUSINESS
ACCOUNTING STUDY PROGRAM
PRESIDENT UNIVERSITY
Cikarang Baru – Bekasi
2018
v
ACKNOWLEDGEMENT
All gratitude and praises to The Almighty God, with all God’s blessings so the researcher
finally able to complete the thesis with entitled” Implementation of Intuit Quickbooks in
PT. Trisan Pakar Baja” as one part of the fulfilments to graduate as Bachelor Degree of
Science in Accounting.
I would like to give special gratitude toward the several people that always provide support
for me from the beginning until the end of this thesis.
1. Mrs. Andi Ina Yustina, M.Sc.,CMA as Head of Accounting Study Program
President University. I would like to express my gratitude for Mrs. Ina for the
motivation, support, and encouragement and provide me the best advisor that can
guide from beginning until completing my thesis.
2. I would like to express my sincere gratitude to my advisor, Mrs. Setyarini Santosa,
SE.,MAFIS.,Ak for the support, her advice, motivation, patience, knowledge, and
encouragement. Her guidance helped me in writing and completing this thesis.
3. Deepest gratitude goes to my parents, Fransiskus Ateng Uni and Linda Susanti, my
sister, Christine Angelia. Thank you for all the support and prayer that has been
given to me. Without them, I would not be able to go through many hard times.
4. Thank you to my friends, Fernando Van Wis Lee, Robin, Billy Sutanto, Kevin
Marcelius, Richard Wijaya, Jonathan Hardi, and Ignatius Maria for always remind
me to finishing my thesis, and give me motivation also spirit to do this research.
5. Finally for all the other parties that I could not mention one by one who help and
support me during the thesis writing process. May God gives the blessings.
vi
RECOMMENDATION LETTER FROM THESIS ADVISOR
This thesis is prepared and submitted by
Name : Roy Bratakusuma Uni
Student ID : 008201500027
Faculty : Business
Study program : Accounting
Field of study : Management Accounting
Thesis title :
IMPLEMENTATION OF INTUIT QUICKBOOKS IN PT. TRISAN PAKAR
BAJA
has been reviewed and found to have satisfied the necessities for oral defense as
partial fulfillment of the requirements for the Bachelor’s Degree in Accounting.
Cikarang, 13th December 2018
Bekasi, Indonesia
Acknowledged
Head of the Accounting Study Program Thesis Advisor
(Andi Ina Yustina, M. Sc.,CMA) (Setyarini Santosa, SE.,MAFIS.,Ak)
vii
TABLE OF CONTENTS
SKRIPSI TITLE….................................................................................................i
PLAGIARISM DOCUMENT……………………………………….......………ii
DECLARATION OF ORIGINALITY……………….....………………….......iii
PANEL OF EXAMINERS APPROVAL SHEET……………………………..iv
ACKNOWLEDGEMENT...…………………………………………….….........v
RECOMMENDATION LETTER FROM THE THESIS ADVISOR………..vi
TABLE OF CONTENTS………………………………………….……….…...vii
LIST OF FIGURES……………………………………………………….….…..x
LIST OF TABLES..……………………………………………………………xiii
ABSTRACT…………………………………………………………….......…...xv
INTISARI……………………………….………………………………...…….xvi
CHAPTER I INTRODUCTION………………………………………………...1
1.1 Research Background…………………………………...…………1
1.2 Problem Identification and Statement…...........................................6
1.3 Research Scope and Limitation……………………………………9
1.4 Research Objectives……………………………………………...10
1.5 Research Benefits………………………………………………...10
1.5.1 For The Researcher…………………………………………10
1.5.2 For The Future Researcher………………………………….11
1.5.1 For PT Trisan Pakar Baja…………………………………...11
1.6 Research Method…………………………………………………11
1.6.1 Interview……………………………………………………11
1.6.2 Observation………………………………………………...11
1.6.3 Documentation……………………………………………..12
1.6.4 Tracing……………………………………………………..12
1.6.5 Vouching…………………………………………………...12
1.6.6 Conversion…………………………………………………12
CHAPTER II LITERATURE REVIEW………………………………………13
2.1 Faithful Representation as Fundamental Quality of Financial
viii
Statement………………………………………………………..13
2.2 Timeliness in Financial Reporting……………………………....14
2.3 Manual Accounting Process and Computerized Accounting
Process…………………………………………………………15
2.4 Intuit Quickbooks…………………………………………..…..16
CHAPTER III DATA PROCESSING METHOD AND COMPANY'S
EXISTING CONDITION……………………………………..18
3.1 Data Collecting and Processing………………………………….18
3.1.1 Interview…………………………………………………..18
3.1.2 Observation……………………………………………….20
3.1.3 Documentation……………………………………………24
3.2 Company's Existing Condition…………………………………..26
3.2.1 History of PT. Trisan Pakar Baja………………………….26
3.2.2 PT. Trisan Pakar Baja's Operation………………………...27
3.2.3 PT. Trisan Pakar Baja's Organization Structure…………..28
3.2.4 PT. Trisan Pakar Baja’s Accounting Activities……………29
3.3 Consideration of PT. Trisan Pakar Baja Accepting Adoption of
Intuit Quickbooks……………………………………………….30
CHAPTER IV ANALYSIS AND EVALUATION…………………………….32
4.1 Faithful Representation Checking in PT. Trisan Pakar Baja……..33
4.2 Faithful Representation (Free From Error) Issue in PT. Trisan Pakar
Baja……………………………………………………………...44
4.2.1 Proposed and Implemented Solution……………………...46
4.3 Timeliness Issue in Generating Monthly Financial Report………51
4.3.1 Proposed and Implemented Solution……………………...52
4.3.1.1 Installation and Chart of Account Setup in Intuit
Quickbooks ………………………………………53
4.3.1.2 List of Vendors, Inventory, and Customers Setup in
Intuit Quickbooks ………………………………..57
4.3.1.3 Balance Amount and Accounting Period Setup in
ix
Intuit Quickbooks………………………………...61
4.3.1.4 Generalization of Inputting The Transactions in Intuit
Quickbooks ………………………………………63
4.3.1.5 Creating Financial Statement in Intuit Quickbooks .84
CHAPTER V CONCLUSION AND RECOMMENDATION………………..93
5.1 Conclusion……………………………………………………….93
5.2 Recommendation………………………………………………...94
COMPANY'S CONFIRMATION LETTER………………………………….95
REFERENCES………………………………………………………………….96
APPENDICES…………………………………………………………………..98
x
LIST OF FIGURES
Figure 1.1 The Recorded Journal of Vehicle Acquisition by Credit (In Rupiah) ...... 3
Figure 1.2 The Value of Vehicle Fixed Assets Acquired (In Rupiah) ....................... 4
Figure 3.1 Monthly Income Statement PT. Trisan Pakar Baja December 2017 ...... 22
Figure 3.2 Monthly Statement of Financial Position PT. Trisan Pakar Baja December
2017 ........................................................................................................ 23
Figure 3.3 Illustration of The Invoice of Vehicle Acquisitions ............................... 25
Figure 3.4 Illustration of Inventory Bill of Ladding ................................................ 26
Figure 3.5 PT. Trisan Pakar Baja Organization Chart ............................................. 29
Figure 4.1 Company’s Problem Framework ............................................................. 33
Figure 4.2 Adjustment Journal for Mistatement Value of Vehicle .......................... 47
Figure 4.3 Recording for Monthly Installment Payment of Vehicle ......................... 50
Figure 4.4 Revision of Recognition of Vehicle in Financial Statements ................... 50
Figure 4.5 Accounting & Finance Department Job Description ................................ 52
Figure 4.6 Established Chart of Account Using Intuit Quickbooks (Asset
Accounts) ................................................................................................ 55
Figure 4.7 Established Chart of Account Using Intuit Quickbooks (Liabilities and
Equity Accounts) .................................................................................... 56
Figure 4.8 Established Chart of Accounts Using Intuit Quickbooks (Revenue and
Expenses Accounts) ............................................................................... 57
Figure 4.9 List of Customers and Vendors of PT. Trisan Pakar Baja ........................ 58
Figure 4.10 Established Customers Lists Using Intuit Quickbooks........................... 59
Figure 4.11 Established Vendors Lists Using Intuit Quickbooks .............................. 60
Figure 4.12 Established Inventory Lists Using Intuit Quickbooks ............................ 60
xi
Figure 4.13 First Steps in Adding Beginning Balance of Account in Intuit Quickbooks
............................................................................................................... .62
Figure 4.14 Second Steps in Adding Beginning Balance of Account in Intuit
Quickbooks ............................................................................................ .63
Figure 4.15 Data Flow Diagram of PT. Trisan Pakar Baja Sales Transactions ......... 66
Figure 4.16 Data Flow Diagram of PT. Trisan Pakar Baja Purchasing Transactions 67
Figure 4.17 Data Flow Diagram of PT. Trisan Pakar Baja Other Transactions......... 68
Figure 4.18 Data Flow Diagram of PT. Trisan Pakar Baja of Monthly Financial
Statement ................................................................................................ 69
Figure 4.19 Accountant Center Menu in Intuit Quickbooks ...................................... 70
Figure 4.20 Creating The Sales Order in Intuit Quickbooks ..................................... 72
Figure 4.21 Processing The Sales Order Into Invoice in Intuit Quickbooks .............. 73
Figure 4.22 Inputting The Customers Payment in Intuit Quickbooks ....................... 74
Figure 4.23 Creating The Purchase Order in Intuit Quickbooks ............................... 75
Figure 4.24 Processing The Purchase Order Into Bill in Intuit Quickbooks .............. 76
Figure 4.25 Inputting The Payment to Supplier in Intuit Quickbooks ....................... 77
Figure 4.26 The Payment Summary in Intuit Quickbooks ........................................ 78
Figure 4.27 Inputting The Fund Transfer to Bank Account in Intuit Quickbooks ..... 79
Figure 4.28 Inputting The Liquidized Giro Amount to Bank Account in Intuit
Quickbooks ............................................................................................. 80
Figure 4.29 Recording for Salary Payment Into Intuit Quickbooks .......................... 80
Figure 4.30 Recording for Monthly Expenses Payment Into Intuit Quickbooks ....... 81
Figure 4.31 Recording for Sudden Expenses Payment Into Intuit Quickbooks ......... 82
Figure 4.32 Recording for Depreciation of Fixed Assets Into Intuit Quickbooks ..... 82
Figure 4.33 Income Statement Generated by Intuit Quickbooks ............................... 83
xii
Figure 4.34 Recording Adjustment Journal for Misstatement Value of Vehicle into
Intuit Quickbooks ................................................................................... 84
Figure 4.35 Recording of Monthly Installment Payment of Vehicle into Intuit
Quickbooks ............................................................................................. 85
Figure 4.36 Statement of Financial Position Generated by Intuit Quickbooks .......... 86
Figure 4.37 Income Statement Manually Generated by PT. Trisan Pakar Baja for
January 2018 ......................................................................................... 89
Figure 4.38 Statement of Financial Position Generated by PT. Trisan Pakar Baja for
January 2018 ......................................................................................... 90
xiii
LIST OF TABLES
Table 1.1 The Monthly Comparisson Effect of Depreciation Charg between The
mistatement and Real Value of Vehicle Fixed Assets from October until
December 2017 ........................................................................................ 5
Table 3.1 Illustration of The Journalizing Transactions in PT. Trisan Pakar Baja .. 21
Table 3.2 Monthly Inventory Evaluation Summary PT. Trisan Pakar Baja December
2017 ........................................................................................................ 24
Table 4.1 Conducted Checklist of All Accounts in PT. Trisan Pakar Baja .............. 36
Table 4.2 Example of Recapitulated Transactions List of Cash Account in PT. Trisan
Pakar Baja ............................................................................................... 38
Table 4.3 Example of Recapitulated Transactions List of Account Payable Account
in PT. Trisan Pakar Baja ......................................................................... 40
Table 4.4 Example of Recapitulated Transactions List of Sales Revenue Account in
PT. Trisan Pakar Baja ............................................................................. 41
Table 4.5 Example of Recapitulated Transactions List of Expense Account in PT.
Trisan Pakar Baja .................................................................................... 43
Table 4.6 Comparisson of Monthly Depreciation Charge for Credited Vehicle Fixed
Assets ...................................................................................................... 45
Table 4.7 Revision of Recognition of Vehicle after Adjustment ............................ 49
Table 4.8 PT. Trisan Pakar Baja’s Chart of Account Before Conversion into Intuit
Quickbooks ............................................................................................. 53
Table 4.9 Types of PT. Trisan Pakar Baja’s Transactions ...................................... 64
Table 4.10 Inventory Evaluation Summary Generated by Intuit Quickbooks ......... 87
xiv
Table 4.11 Inventory Evaluation Summary Generated by PT. Trisan Pakar Baja for
January 2018 ......................................................................................... 91
xv
IMPLEMENTATION OF INTUIT QUICKBOOKS IN
PT. TRISAN PAKAR BAJA
ABSTRACT
This research aims to implement the Intuit Quickbooks software as the new
accounting process in PT. Trisan Pakar Baja for improving the timeliness and
faithful representation aspects. Timeliness in PT. Trisan Pakar Baja refers to
ability for the company to create the financial statement on-time which at the end
of month. Faithful representation refers to how the company presents all the
accounts in financial statement in correct amount. These problems happened due
to conventional accounting process that adopted by the company and lack of
experience of the Accounting & Finance Department in treating each type of
transactions.
This research is a qualitative research. The object of this study is accounting
process of PT. Trisan Pakar Baja especially in general ledger and financial
statement. The research methods used are interview, observation, documentation,
tracing, vouching, and conversion. The research uses primary data.
The results of this study show that a lot of side effects caused by timeliness
and faithful representation issues that still not been solved yet by the company. The
delayed in deciding to restock the inventory happened due to delayed financial
statement generated from Accounting & Finance Department for two weeks after
the end of month. Also, overstatement in recording the amount of credited vehicle
happened in the company that resulting the depreciation charged higher and
lowering the profit,
To improve timeliness and faithful representation at PT. Trisan Pakar Baja,
the researcher implemented Intuit Quickbooks as the new accounting process in
recording and reporting.
Key words: Timeliness, Faithful Representation, Intuit Quickbooks, Financial
Statement, Decision Making.
xvi
IMPLEMENTATION OF INTUIT QUICKBOOKS IN
PT. TRISAN PAKAR BAJA
INTISARI
Penelitian ini bertujuan untuk mengimplementasikan perangkat lunak Intuit
Quickbooks sebagai proses akuntansi baru di PT. Trisan Pakar Baja untuk
meningkatkan ketepatan waktu dan representatsi yang terpercaya. Ketepatan
waktu di PT. Trisan Pakar Baja mengacu pada kemampuan perusahaan untuk
membuat laporan keuangan tepat waktu yang pada akhir bulan. Representasi yang
terpercaya mengacu pada bagaimana perusahaan menyajikan semua akun dalam
laporan keuangan dalam jumlah yang benar. Masalah-masalah ini terjadi karena
proses akuntansi konvensional yang masih diadopsi oleh perusahaan dan
kurangnya pengalaman dari Departemen Akuntansi & Keuangan dalam
memperlakukan setiap jenis transaksi.
Penelitian ini merupakan penelitian kualitatif. Objek penelitian ini adalah
proses akuntansi PT. Trisan Pakar Baja terutama dalam buku besar dan laporan
keuangan. Metode penelitian yang digunakan adalah wawancara, observasi,
dokumentasi, penelusuran, vouching, dan konversi. Penelitian ini menggunakan
data primer.
Hasil penelitian ini menunjukkan bahwa banyak efek samping yang
disebabkan oleh ketepatan waktu dan masalah representasi terpercaya yang masih
belum dapat diatasi oleh perusahaan. Penundaan dalam memutuskan untuk
mengisi kembali persediaan terjadi karena laporan keuangan tertunda yang
dihasilkan dari Departemen Akuntansi & Keuangan selama dua minggu setelah
akhir bulan. Kemudian, kesalahan pencatatan dalam harga yang berlebih pada
kendaraan yang dikreditkan terjadi di perusahaan yang mengakibatkan depresiasi
dibebankan lebih tinggi dan menurunkan laba.
Untuk meningkatkan ketepatan waktu dan representasi yang terpercaya di
PT. Trisan Pakar Baja, peneliti melakukan implementasikan Intuit Quickbooks
sebagai bagian dari proses akuntansi dan pelaporan.
Kata kunci: Kinerja Perusahaan, Keuntungan, Peraturan, Standar Operasional
Prosedur, Target Perusahaan.
1
CHAPTER I
INTRODUCTION
1.1. Research Background
As the market constantly change from time to time, timely and precise
information will be needed in order to face the global economic situation. This
condition will affect to the decision making process conducted by the manager to
decide the direction of the company. Nowadays, it really hard to make decision
making process when the information are not presented in accurate and timely
manner.
In Indonesia, small or big companies currently facing the impact of slow
action to face the current market. For example, Matahari is a well-known company
that suffers from the impact of slow reaction of decision making in concerning
market needs and trends from information that already obtained (Julianto, 2017).
As a results, a lot of branches in Indonesia right now are closing due to lack of
action conducted to face the market that rapidly changes.
This study will discuss a company that suffers from the economic changes.
PT. Trisan Pakar Baja is a steel distributor located in Pontianak, West Borneo. The
company established in 2015. During the year of operations until right now, this
company already build many relations with different kinds of customers from inside
and outside of Pontianak as the company keep to expanding their business.
2
It is necessary for company to concern about the market demand on the
product being sold to get more profit. According the interview results from the
General Manager from PT. Trisan Pakar Baja, they experienced the decision
making lateness since business expansion in 2017. The lateness to decide on
ordering the product appeared due to timeliness issue related with delay in
presenting the company’s monthly financial statement. In that monthly financial
statement contains additional information regarding summary of inventory
evaluation for one month, which will be used as main information for deciding the
types of inventory that need to be purchased.
The financial statement is one of the core information that necessary for the
manager to know financial condition of the company and as the benchmark for
various types of decisions such as resupplying inventory or providing incentives/
bonus to the manager. One of the factor, that caused the lateness of information
presentation come from the accounting cycle that adopted by the company. The
company still adopt conventional/ manual accounting process in journalizing the
transaction and later on process it. As the result, these process tend to generate the
financial report for two or three weeks after the end of month. However, the General
Manager of PT. Trisan Pakar Baja feel concerned regarding these situation. Since,
the company’s monthly financial statement usually generated in two or three days
after the end of month due to lack of manpower in handling the accounting tasks
and during 2017 the situation changed drastic into lateness in presenting the report.
These problem will certainly related the timeliness factor that concerned with the
speed of presenting the current financial condition in the company.
3
It is also important to consider the content of information in reporting the
financial report especially regarding the value that presented. The mistake in
presenting the information in financial report will lead into misinterpretation of
decision and create unfaithful representation of financial information. Issue
regarding faithful representation happened in this company in the form of
misconception in recording the value of credited vehicle assets that creating the
overstatement at the time of acquisition that can be seen in Figure 1.1.
FIGURE 1.1
THE RECORDED JOURNAL OF VEHICLE ACQUISITION
BY CREDIT (IN RUPIAH)
Source: PT. Trisan Pakar Baja
In the recorded journal in Figure 1.1, there were mistakes in recording the
amount that did not match with the invoice that already received (one of example
of invoice can be seen in Appendix A). Even though in those invoice already consist
of costs to make vehicle operate immediately, still the amount were not matched
between the journal and the invoice of acquisition. These overstatement appeared
due adding the total value of interest that need to be paid into the value of assets
that lead into this condition that can be seen on Figure 1.2. As the results, the
4
depreciation expenses that incurred for this company were higher than what it
should be and will lowering the monthly profit. The comparison of depreciation
value between the journalized and real version can be seen in Table 1.1. Even
though the value were not significant in lowering the profit, still it need to be fixed
in accordance with existing Indonesian accounting standard and provide faithful
information.
FIGURE 1.2
THE VALUE OF VEHICLE FIXED ASSETS ACQUIRED (IN
RUPIAH)
Source: PT. Trisan Pakar Baja
5
TABLE 1.1
THE MONTHLY COMPARISSON EFFECT OF
DEPRECIATION CHARGE BETWEEN THE MISTATEMENT
AND REAL VALUE OF VEHICLE ASSETS FROM OCTOBER
UNTIL DECEMBER 2017 (IN RUPIAH)
Corresponding with the current company situation, lighten up the researcher
initiative to solve the problem occurred and implementing accounting software in
the current accounting process by using Intuit Quickbooks. If this issues related
with accounting process keep on existing, it will certainly affect the future condition
of company in decision making process. By that means, PT. Trisan Pakar Baja
accepting for improving their accounting process using Intuit Quickbooks as part
of accepting and moving forward from the existing problem to avoid any kinds of
new potential side effects occurred.
Therefore, the researcher expects that by translating PT. Trisan Pakar Baja
into computerized version with Intuit Quickbooks will help on improving the time
Source: PT. Trisan Pakar Baja
6
consumption in creating the monthly financial report and the accuracy of providing
the reliable information. Also, with solving the faithful representation issue
regarding the overstatement in vehicle fixed assets will provide more reliable
financial information presented.
1.2. Problem Identification and Statement
The current accounting process adopted by the company was still in
conventional ways. All of the process begin with the manually recording the
transactions into a book by handwriting. At the end of month, they will compile all
of the journals and process it to create the company’s own monthly financial
statement that consist of income statement, balance sheet, and inventory valuation
summary. This process had already been done ever since it was built until the end
of 2017.
However, in the beginning of 2017 when the company’s business keep
expanding, these accounting process could not keep up with the tasks and
transactions being given to Accounting & Finance Department. That result to the
delayed time in creating and presenting the monthly financial report from 2 or 3
days after the end of month to 2 or 3 weeks. With these circumstances, the decision
making process that relied on monthly financial report also affected. The company
usually order for resupply inventory at the beginning of month dragged into middle
of next month due to these lateness. Due to ordering the inventory around middle
of next month resulting on the goods delivered to the company at the end of month
during the ordering month. That situation was very risky for the stock of inventory
in that company especially when they had zero stock of inventory and there were
7
some customers ordered that products. Which make the company lost some of its
customers for not having inventory prepared for them. According interview result
from the General Manager, those situation already happened for several times in
2017, but the customers were still able to tolerate that situation and wait until the
inventory were ready. Therefore, the problem lead into the timeliness factor of the
accounting process that need to be improved and updated with current new
technologies by using computerized accounting process.
Also, the other function that decision making relied upon the monthly
financial report for providing the bonus reward for the General Manager from the
Board of Directors of PT. Trisan Pakar Baja. The monthly financial statement
mostly will be reviewed by the Board of Director for gaining the financial insight
of this company. When, the company is in profitable situation, the Board of Director
will provide the bonus personally for the General Manager as the present for his
effort. However, since there was lateness in presenting monthly financial report
affect to the time of incentive provided. Where this result might impact the General
Manager behavior to be less motivated in making the company more profitable.
These condition is important for the company’s initiative especially the General
Manager in this company being responsible for decision making on profitable daily
activities.
In order to implement the new computerized accounting process in the
company to solve timeliness, there will be need strong foundation for all of accounts
that presented in financial statement to avoid misleading information. To ensuring
the quality of information, it need to be determine by comparing all of accounts
8
whether in accordance with the existing conceptual framework especially in faithful
representation concept. The faithful representation aspects focus in presenting the
reliable financial information by checking all the accounts with completeness,
neutrality, and free from error as part of quality that focused by faithful
representation.
During the checking of all the accounts towards the faithful representation
aspects, there were several errors detected in the accounts recorded. The error
related with misstatement in the recordings of book value of vehicle fixed assets.
In that value of credited vehicle fixed assets, there are overstatements of the value
of the assets that mismatch with the documentation (invoice). These overstatement
appeared due to capitalizing of all interest expense that need to be paid as the initial
recording during the acquisitions. Also, The method of capitalizing interest
conducted by the Accounting & Finance Department due to not knowing the
existing rule for treating these kind of transactions. With that conditions, provide
the researcher need to solve these problems first to assure that the accounts are in
accordance with faithful representations before converted into the computerized
accounting process to ensure the quality of information provided and help to solve
the timeliness issue.
In conclusion, the existing problems could be identified into several
research questions which are:
1. How to solve the accounting information system problem occurred in the
company which resulting the delay in generating financial statement?
2. How to assure all of accounts in comprehend with faithful representation?
9
Questions that will need to be investigated in this research whether the
solution provided by researcher capable in solving the company’s current
accounting process using Intuit Quickbooks as the new method of recording and
reporting. This research will solving, translating and implementing the new
computerized accounting process that is in accordance with existing standard of
accounting.
1.3. Research Scope and Limitation
PT. Trisan Pakar Baja concerns in upgrading their accounting process by
adopting the new accounting software to improve general ledger and financial
statement. The company already approved and accepted to implement Intuit
Quickbooks as their new accounting process. Therefore, this research will focus on
general ledger and financial statement conversion to Intuit Quickbooks by using the
existing daily operations activities in the company as the data sources.
This study will focus on the journalizing process of this company as the first
step and process it for creating the monthly financial statement with the use of Intuit
Quickbooks software. Besides from that, this research will translating the current
accounting process of the company in computerized method in Intuit Quickbooks
which will create the synchronization of existing procedures by using the source of
data from existing operations of the company. These procedure conducted in order
to improve the effectiveness in recording the transactions and ensuring to generate
the monthly financial statement on time (at the end of month).
10
1.4. Research Objectives
Due to lateness of decision making from conventional method of accounting
control adopted by PT. Trisan Pakar Baja researcher will conduct research, with the
objectives:
1. Success in journalizing all of the transactions in accordance with faithful
representations concepts embed in each accounts for providing non-
misleading information.
2. Success to convert the current general ledger and reporting cycle of PT.
Trisan Pakar Baja into Intuit Quickbooks as the new computerized
accounting process for this company in order to improve the timeliness in
reporting financial statement.
1.5. Research Benefits
This research will provide benefit about improving current conditions of
accounting process in the company that impacted to the decision making that based
on timeliness and precise information financial report. Moreover, this research will
be expected to be beneficial for the following parties and uses:
1.5.1 For the Researcher
Researcher will obtain more knowledge regarding the accounting process
of the company especially in general ledger and reporting. Also, it will provide the
additional knowledge in converting the existing accounting process into accounting
software.
11
1.5.2 For Future Researchers
This research will provide the readers better understanding toward the
company’s accounting process. Specifically the research will focus on the aspects
of general ledger and reporting for the faithful representations and timeliness in
presenting monthly financial report. Furthermore, it will give insight for readers to
test other possibilities of software or program to be implemented for improving
other aspect of internal company’s activities.
1.5.3 For PT. Trisan Pakar Baja
The benefits for the company is to be able to identify and present the reliable
information related with the accounting information that happened during the
accounting process adopted and provide improvement in faithful representation and
timeliness of the company in generating the monthly financial statement for
decision making process.
1.6. Research Method
1.6.1 Interview
Based on Arens et al. (2017) interview means giving oral questions or
discussion from the members of the company being researched. From the
invalidated information obtained will be validated with other procedures.
1.6.2 Observation
Based on Arens et al. (2017) observation mean obtaining information
related with company situation, activities, and procedures of certain task, and work
environment by observation itself (smelling, hearing, feeling, and seeing).
12
1.6.3 Documentation
Based on Arens et al. (2017) documentation refers to tracking down the
internal or external evidences from the researched transactions or activities.
Furthermore, the result form investigation will be explained later on by the
researcher.
1.6.4 Tracing
According to Arens et al. (2017), tracing refers to activity in tracking the
recordings of transactions back into the document source all the way until the
financial statements reporting. This method will be used by the researcher to ensure
the faithful representation concepts existed in each accounts of PT. Trisan Pakar
Baja.
1.6.5 Vouching
According to Arens et al. (2017), vouching refer to activity that ensuring
the amount that existed in financial statement can be found in the original
recordings or documents that proved that transactions exist. This also another
method used by the researcher to provide the assurance that faithful representations
concepts already appeared in each accounts of the company.
1.6.6 Conversion
This method refers to changing the existing condition into the new activities
that lead into same end results (Kawulich, 2004). Before these method conducted,
the existing condition need to be prepared thoroughly and free from error to avoid
failure in conversion.
13
CHAPTER II
LITERATURE REVIEW
2.1. Faithful Representation as Fundamental Quality of Financial
Statement
In presenting the financial statement for the use of stakeholders, it need to
concern about the quality of information presented (Krismiaji et al., 2016).
According to Krismiaji et al. (2016), the quality in reporting is essential as the basis
for economic decision making for internal and external party. In high quality of
financial statement, the faithful representation will be the core concept that need to
be embed in the statement (Cheung et al., 2010). Faithful representation refers to
the representation of financial condition that related with amount and details are
same with the real condition that existed. The concept of faithful representation
exist as part on conceptual framework of qualitative reporting that focus in
representing the information regarding financial conditions of the company to be
not misleading (Kieso et al., 2011).
In order to obtain faithful representation in financial statement quality,
several ingredients of fundamental quality need to be existed and conducted
altogether. There are three essential areas which are completeness, neutrality and
free from error (Kieso et al., 2011). The completeness refers to the all content of
information presented in financial report have provided thoroughly (Kieso et al.,
2011). Then, neutrality concern in limiting the company in selecting the
14
information for one of party interest only over another (Kieso et al., 2011). Finally,
all information that presented need to be free from error to provide accuracy
representation of financial information of the company.
Financial statement is important since the several decisions require financial
statement as their base in making decision for internal or external perspective.
Without the quality, misleading and information asymmetry could be possible to be
happen and will impact to wrong decision that taken for.
2.2. Timeliness in Financial Reporting
As the quality aspects are important for the financial report presented,
timeliness also become additional aspect to add the relevancy of information
(Agyei-Mensah, 2018). Timeliness refers to the availability of information at the
point of decision-makers need it. The other capability of timeliness related in
reducing the environmental uncertainty especially in making decision using the
timely information (Gullberg, 2016). When the information could not be available
at needed time or available for longer period after the reported transaction, it will
give no value toward future action since the relevancy of information decreasing
and becoming less useful. Therefore, lack of timeliness will be able to lower
relevancy of information especially for the decision of future action.
15
2.3. Manual Accounting Process and Computerized Accounting
Process
The accounting process always exist in each company for presenting
financial information of the company (Ji et al., 2016). This process itself refers to
the step by step procedures from the recording of transactions to journal, post to
ledger, prepare the trial balance, prepare adjustment of end of period trial balance,
and finally preparing the financial statement.
The accounting process has already been growing to provide more
convenience and saving cost while presenting the high quality of information.
Based on Victoria (2017), there are transition from manual accounting process until
the recent development of computerized accounting process that mostly used by the
companies. Manual accounting process implies the employee will conduct the
accounting process manually on periodic basis from journalizing until the creation
of financial statements which requires a lot of time spent and effort to conduct the
process. However, using computerized accounting means the employee only
conduct recording of the transaction to the computer that already been installed with
certain accounting software and the rest of the process will be automatically
processed until the financial report.
The main advantages of computerized accounting will definitely provide the
timeliness of reporting as the effectiveness of work increasing which can reduce the
amount of error happened in manual accounting (Victoria, 2017). Grant et al. (2008)
also supported the use of computerized accounting to be accounting process of the
16
company, where the use of the accounting software will reduce the significant error
that usually appeared in financial report.
2.4. Intuit Quickbooks
Quickbooks is software developed by Intuit. This software coverages in
accounting section in business area. One capability of this software is its ability to
confront on a whole accounting process in one business (McCraigh et al. 2000).
Also, there are nine significant features that differentiate Intuit Quickbooks with
other accounting software according to Schiff & Szendi (2014) which are: 1)
organized main interface on daily business operations; 2) command using English-
language; 3) Error can be adjusted; 4) a single journal combined all transactions; 5)
help certain transaction to be efficiently inputted; 6) closing entries at the end of
fiscal year are unnecessary to conducted; 7) payroll tax returns can be easily printed
and income tax return can be connected with various individual accounts; 8)
Extensions software, which are internet banking and verification of credit card, can
be synchronized with this software to increase convenience and efficiency of
transaction; 9) Personalized version of Intuit Quickbooks based on the industries or
variant users are available. These features made the popularity of using this
software as main operation in handling all financial transactions in the firm rather
than manual accounting process and other software.
According to Schiff & Szendi (2014), the Intuit Quickbooks software
already almost used by the small business in United States. The reasons behind it
due to use uniqueness and simplicity of this software towards the accounting
17
process in the business. The capability and features in handling the accounting
aspect in business provide convenience for the users that lack with accounting
background (Perry, 2006). However, Schiff and Szendi (2014) suggested that
person with the accounting background should be the one handle this software in
order to avoid any kind of error during the inputting the data and due to the
accountant is the person who understand the process of creating reliable financial
statement. Therefore, the user need to be someone that at least have knowledge of
accounting in principle for the implementation of accounting process from using
this software.
18
CHAPTER III
DATA PROCESSING METHOD AND COMPANY’S
EXISTING CONDITION
3.1. Data Collecting and Processing
This research will improve and convert the current accounting process of
PT. Trisan Pakar Baja. Data collection was conducted to gather the evidence and
insight regarding the condition of the company by conducting interview with
related stakeholders, observation, and documentation.
3.1.1 Interview
Researcher conducted unstructured interview with General Manager and
Head of Accounting & Finance for the concern about the current accounting process
did by the company that lead toward decision making process. The real interview
results from General Manager and Head of Accounting & Finance can be seen in
Appendix B and C. The summary of information obtained by the researcher during
interview are:
1. PT. Trisan Pakar Baja consistently having growth from year over year
since it was founded on 2015, which came from getting more diverse
type of customers from time to time. In 2016, the numbers of customers
of PT. Trisan Pakar Baja were only 70 customers and all of them reside
in Pontianak, West Borneo. Then in 2017, sudden increase in the
19
numbers of customers and the different area that customers reside in the
total of 157 new customers varied from other area such as Singkawang,
Punggur, Bengkayang.
2. PT. Trisan Pakar Baja accounting process mainly constructed from the
moment of the invoice or any supporting documents came to the
Accounting & Finance Department, all of transactions will be
collectively journalize at near end of working time in the empty blank
sheet. At the end of month all of the journal will be directly grouped
based on each accounts and totaled the amount alongside with the other
necessary adjustment entries that need to be made too. After that, the
grouped account will be used to make the financial statement.
3. PT. Trisan Pakar Baja’s Accounting & Finance Department only
consist of two persons which one act as Head of Accounting & Finance
and the other as the Vice. They explained responsibilities of the
Accounting & Finance Department not only to prepare the financial
statement, but to make the invoice, deposit money to bank, make
transfer payment, settle any expenditures for operation and conducting
stock opname. Due to overwhelming transactions need to be processed
by the company, the financial statement tend to get delayed until middle
of next month rather than in the end of month.
4. General Manager of PT. Trisan Pakar Baja confessed that during year
of 2017 as the business expanding, he sensed the lateness on making
decision for resupplying inventories from supplier since he usually
20
refers to the monthly financial report especially on inventory evaluation
summary as the part of consideration. The decision will be based on
percentage of retail contained in that inventory evaluation summary for
the each item to be exceed 10% of the retail amount and the resupply
can be conducted on each item that meet that criteria.
The General Manager felt that delay is the main problem since monthly
financial statement provided by the Accounting & Finance department
from usually at four or five days after the end of month into two or three
weeks after the end of month. Also, the General Manager was afraid if
this condition continued further it will make certain demanded product
will be out of stock when customers wanted to purchase the product
which will make the company lost their customer.
5. Both of General Manager and Head of Accounting & Finance confess
that they need some kind of accounting software that can help them to
create faster financial report without trouble by only input the journal
of the transactions
3.1.2 Observation
During the four months of observation in PT. Trisan Pakar Baja, researcher
could obtain data and information. The researcher observes PT. Trisan Pakar Baja
employee’s activities especially in Accounting & Finance Department. Result of
observation obtained by researcher:
1. Observation in accounting process in the company especially in
journalizing the transactions that occurred in daily operations of the
21
company. In that company, handwriting journal still conducted to record
each transactions that can be seen in Appendix D. The illustration from
the observed result of Appendix D can be seen in Table 3.1. The point
of time journalizing conducted mostly at the time when Accounting &
Finance Department did not have any tasks at near end of work time.
TABLE 3.1
ILLUSTRATION OF THE JOURNALIZING
TRANSACTIONS IN PT. TRISAN PAKAR BAJA
2. Observation related with whole accounting process in the company
conducted from beginning of journalizing until the creation of financial
statement. After the process of journalizing has been conducted for one
month, the Accounting & Finance Department will compile all of the
journal and categorized by using Microsoft Excel first. Then, after the
categorization successfully conducted, they will construct all of the
necessary account into monthly financial statement that can be seen in
Figure 3.1, 3.2 and Table 3.2.
Source: PT. Trisan Pakar Baja
22
FIGURE 3.1
MONTHLY INCOME STATEMENT PT. TRISAN
PAKAR BAJA DECEMBER 2017
Source: PT. Trisan Pakar Baja
23
FIGURE 3.2
MONTHLY STATEMENT OF FINANCIAL
POSITION PT. TRISAN PAKAR BAJA DECEMBER
2017
Source: PT. Trisan Pakar Baja
24
TABLE 3.2
MONTHLY STATEMENT OF FINANCIAL
POSITION PT. TRISAN PAKAR BAJA DECEMBER
2017
3.1.3 Documentation
Source: PT. Trisan Pakar Baja
25
Documentation conducted inside PT. Trisan Pakar Baja. Researcher found
out that,
1. There are several mismatch of journalized book value of credited
vehicles in where the book value recorded amount are larger than the
value when acquisitions. The document can be seen in between Figure
1.1 as the recorded journal and Appendix A as example of invoice of
credited vehicle acquisitions. The content of information that presented
on Appendix A can be illustrated in the Figure 3.3.
FIGURE 3.3
ILLUSTRATION OF THE INVOICE OF VEHICLE
ACQUISITIONS
2. The delivery of inventory from supplier tends to arrive usually at the
end of next month after the order. Since the purchase order from
Source: PT. Trisan Pakar Baja
26
company to supplier tend to be sent during the middle of month and
resulted the inventory will be arrived to the company at the next month.
Evidence of the arrived goods delivery order can be seen on Appendix
E. Where this goods were arrived at near end of January due to the
ordering conducted at middle of December 2017. The content of
information on Appendix E can be illustrated in Figure 3.4.
. FIGURE 3.4
ILLUSTRATION OF INVENTORY BILL OF
LADDING
3.2 Company’s Existing Condition
3.2.1 History of PT. Trisan Pakar Baja
PT. Lintas Bahari Nusantara
Bill of Lading/ Konosemen
Kepada: PT. Trisan Pakar Baja, Pontianak
Kolies/ QTY Items Weight
6 Bundle 12 BDS 21.480 Ton
5 Bundle 10 BDS 11.980 Ton
4 Bundle 10 LSP 9.584 Ton
4 Bundle 8 LSP 9.531 Ton
5 Bundle 8 SBK 10.070 Ton
62.645 Ton
Date Delivered: 22 January 2018
Sukarto
Total
Source: PT. Trisan Pakar Baja
27
Mr. Fajar Tjandra is the founder of PT. Trisan Pakar Baja. The company
was established in Pontianak, West Borneo on 2015. PT. Trisan Pakar Baja build
as a distributor of steel company, which helps other companies or projects to fulfill
their need of resources in building construction or for selling. PT. Trisan Pakar Baja
continuing as a resources provider due to less number of distributor in steel operated
in Pontianak and great demand of steel in Pontianak, made them able to operate
well.
3.2.2 PT. Trisan Pakar Baja’s Operation
As in 2015 until right now, PT. Trisan Pakar Baja act as the distributor of
steel in Pontianak. The main operation that conducted by this company is trading
steel products. The product that are traded consist of:
Plain Steel, this type of steel is one of the most purchased items due to its
function for main material for building construction in order to create strong
foundation. This product varies into several size which are 4 mm x 10 m; 5
mm x 10 m; 5 mm x 12 m; 6 mm x 10 m; 6 mm x 12 m.
Threaded Steel Bars, this product is the second best seller item that used
alongside with plain steel bars. As the use of this threaded steel bars mainly
complement with the use of plain steel bars. This product also varies in
terms of size which can be defined into 10 DMK, 13 DMK, and 13 DMK-
2.
Elbow steel, this product is one of the newest product that offer by this
company to the customers around October 2017. This product mainly help
in construction of building especially in connecting between steels in order
28
to create more than one floor building and etc. This product varies with the
size which are Siku 30, Siku 40, Siku 50.
All of the current stock and details of each quantity of stock can be seen in
Inventory Evaluation Summary of PT. Trisan Pakar Baja in Desember 2017 at the
Figure 3.4. That report contains the details of beginning stock of each inventory and
how much inventory being sold and resupplied to get the ending quantity of each
inventory.
3.2.3 PT. Trisan Pakar Baja’s organization structure
This research will only focus in observing on Accounting & Finance Department
activities on accounting process especially in journalizing and reporting activities.
PT. Trisan Pakar Baja Organization Structure Chart can be seen on Figure 3.5.
Where the total of employees that worked in this company only twenty five
employees with the Accounting & Finance Department only two people handling
that department, one as the head of Accounting & Finance Department and the other
as the Vice of this department.
29
FIGURE 3.5
PT. TRISAN PAKAR BAJA ORGANIZATION CHART
3.2.4 PT. Trisan Pakar Baja’s Accounting Activities
Accounting activities in PT. Trisan Pakar Baja mainly adopting manual
accounting process that consist of several activities to create monthly financial
statement which are:
1. Every transactions that already occurred will be compiled together and
journalized at the end of day by handwriting in the folio size book.
Source: PT. Trisan Pakar Baja
30
2. After the transactions recorded already one month, all of the journalized
journal will be sorted based on each account and summation also conducted
to get the amount. These step conducted by using Microsoft Excel.
3. Financial statement can be constructed by using account that already prepared
from previous step. In preparing and presenting the financial statement the
company used Microsoft Excel.
3.3 Consideration of PT. Trisan Pakar Baja Accepting Adoption
of Intuit Quickbooks
In order to improve the company accounting control especially in the flow
of reporting, Intuit Quickbooks software was introduced to the General Manager
and Head of Accounting & Finance in the company. In order get approval to install
these software, the author explain the advantages of using this software compared
with the other accounting software such as Xero, Freshbooks, Wave, and Zoho in
the following explanations:
1. User-friendly interface that provided by Intuit Quickbooks make it easy to
use and understandable even for someone without any of accounting
background.
2. Integration with whole operations in the business compared with other
competitors software, make Intuit Quikbooks become convenient tools to
control and monitor the existing operations in the business.
3. The customization based on the need and business type of each company
can be conducted by using Intuit Quickbooks. That allows the company to
31
set the projected report in the form of table, diagram, or in the financial
statement for showing financial condition of company right now.
These features of Intuit Quickbooks become good input to explained to
General Manager and Head of Accounting & Finance in PT. Trsian Pakar Baja,
made them accepted and approved the implementation of Intuit Quikbooks to their
accounting process. That will lead this research focus toward beginning
implementation of Intuit Quikbooks. It need to be started from the setting up of the
chart of accounts until the setting up recording the daily transactions occurred in to
setting up a complete monthly financial statement.
32
CHAPTER IV
ANALYSIS AND EVALUATION
There are one of the major aspects that become focus in this study, which is
decision making process conducted by general manager of PT. Trisan Pakar Baja
that concerned with faithful representation and timeliness issues in presenting
monthly financial statement. In each issues there are several problems existed in
the current condition of this company. First, regarding the faithful representation
leading the free from error concern related with misstatement by capitalizing
interest expense on vehicle fixed assets account. Next, regarding the timeliness
issue that lead toward the timing issue/ punctuality of generating monthly financial
statement that could halt the decision in resupplying inventory and bonus reward
for General Manager from Superior since these report will be the basis on those
decisions.
33
FIGURE 4.1
COMPANY’S PROBLEMS FRAMEWORK
Source: Researcher
In accordance with Figure 4.1, the discussion of this research will be divided
into two sections that consist of description related with the problem and
implemented solution to solve each problems. Following discussion will start from
the misstatement due to capitalize interest expense. Then it will be continued to
improving the speed/ timeliness of reporting the monthly financial statement.
4.1 Faithful Representation Checking in PT. Trisan Pakar Baja
The researcher conducted the checking regarding all accounts that presented
in monthly financial statement are in accordance with the faithful representation
aspects especially in terms of completeness, neutrality, and free from error. In order
to know whether each account comply with three aspects of faithful representation
34
or not, several requirements have been set in completeness, neutrality and free from
error aspects alongside with the method that will be conducted to check:
In completeness, all of the existing accounts need to be presented from the
beginning of recording until in financial statement without omitting any part
of information. That means, the checking on all of the accounts started on
transactions that happened in the beginning of December 2017 until the end
of month. In condition where the certain accounts that listed on company’s
chart of account such as vehicle and building did not appear during the
journalizing in December 2017, the researcher will look into the existing
journal related with that account to assess the completeness aspect.
As for neutrality refers to capability of each account to present based on the
reality without favoring one concerned parties over another. Where this
aspect refer to the how the recognition of the basis in each account. In order
to check whether all of the account using the consistent same basis from
time to time, the checking will be based on comparing the date of recording
of the transactions with the existing documents such as invoice, bills, or
other supporting documents. Since different recording time will result on
different value to be presented in financial statement. Therefore, the
checking will conducted to all of journalized transactions that occurred
during December 2017 until the end of that month by comparing it with the
supporting documents. The range of time checking conducted in
transactions occurred during December 2017 due to reassure that all of the
transactions been recorded properly since the balance amount of December
35
2017 will become the beginning balance for the new recordings that start in
January 2018.
Finally for free from error aspect, it requires for all of the accounts to be
accurate for presenting the value in financial statement. Specifically, the
value that represent each account need to free from misstatement especially
in the form of estimation of several accounts that require it. That means,
vouching will be conducted in order to ensure estimation in defining the
value such as vehicle, building, depreciation accounts. Moreover, in order
to confirm other accounts for free from error, the tracing will be conducted
to the journalized transactions in December 2017 till the end of month by
comparing the existing supporting documents whether the amount recorded
are same.
At that time, the researcher found out that all of the accounts were complete
and neutral. However, there are issues identified in several accounts due to
overstatement value of vehicle fixed accounts. The list and result of accounts that
have already been checked by researcher can be seen in Table 4.1.
36
TABLE 4.1
CONDUCTED CHECKLIST OF ALL OF ACCOUNTS IN
PT. TRISAN PAKAR BAJA
Completeness Neutrality Free from Error
Kas & Bank V V (Accrual Basis) V
Giro yang belum jatuh tempo V V (Accrual Basis) V
Piutang Usaha V V (Accrual Basis) V
Persediaan Barang Dagang V V (Accrual Basis) V
Kendaraan V V (Accrual Basis)
X (Error regarding the
misstament of recorded
value of asset at point of
purchase)
Bangunan V V (Accrual Basis) V
Akumulasi Penyusutan Kendaraan V V (Accrual Basis)
X (Error due to
overstament of creditted
vehicle fixed asset resulting
the depreciation rate per
monthly higher than it
should be)Hutang Usaha/ Dagang V V (Accrual Basis) V
Hutang Kendaraan Mobil Inova V V (Accrual Basis)
X (Error regarding the
misstament of recorded
value of asset at point of
purchase)
Hutang Kendaraan Truk Dyna V V (Accrual Basis)
X (Error regarding the
misstament of recorded
value of asset at point of
purchase)
Modal Awal V V (Accrual Basis) V
Laba V V (Accrual Basis) V
Revenue Penjualan Besi Beton V V (Accrual Basis) V
Beban Pokok Penjualan V V (Accrual Basis) V
Biaya Kirim Besi V V (Accrual Basis) V
Biaya Operasional Kantor V V (Accrual Basis) V
Biaya Gaji Karyawan V V (Accrual Basis) V
Beban Penyusutan V V (Accrual Basis)
X (Error due to
overstament of creditted
vehicle fixed asset resulting
the depreciation rate per
monthly higher than it
should be)
Biaya Umum & Lain-Lain V V (Accrual Basis) V
Equity
Expense
Faithful RepresentationsAccounts
Type of
Accounts
Assets
Liability
Source: Researcher Note: V= Checked with no errors
X= Checked but with errors found
37
Based on Table 4.1, that list provide the result of checking in each accounts
existing in company’s financial statement. The overall explanation regarding the
checking of faithful representation aspects towards the main five categories of
account that consist of asset, liability, equity, revenue and expenses can be
explained in below:
Assets= The accounts that used by the company in this type consist of Kas
& Bank, Giro yang belum jatuh tempo, Piutang Usaha, Persediaan Barang
Dagang, Bangunan, Kendaraan, Akumulasi Penyusutan Kendaraan. The
purpose of these accounts to be existed for making the main operating
activities of this company based on the business that company have. The
assessment of the asset accounts especially in faithful representation area
that consist of completeness, reliability, and free from error define several
findings. In completeness aspects, all of the accounts are cleared this
aspects. This can be proved based on the accounting process of this
company, where at the end of month the company will recapitulate
transactions based on the related accounts for making the financial
statement. The example of recapitulate conducted by the company can be
seen on Table 4.2. All of the transactions that journalized related with
respective accounts in assets have been recorded based on respective date
(accrual basis) and amount that located in supporting documents such as
invoice, bills, or others. However, the errors are found in Kendaraan and
38
Akumulasi Penyusutan Kendaraan accounts in the amount that already been
journalized. The sample of these errors can be found in Figure 1.1 as the
journal and Figure 3.3 as the supporting document.
TABLE 4.2
EXAMPLE OF RECAPITULATED TRANSACTIONS
LIST OF CASH ACCOUNT IN PT. TRISAN PAKAR
BAJA
Liability= The accounts that used by the company in this type consist of
Hutang Usaha/ Dagang, Hutang Kendaraan Mobil Inova, Hutang
Kendaraan Truk Dyna. The purpose of the existence of these accounts to
indicate that company still has debt that need to be paid and the settlement
will be conducted for the future period. The assessment of the liability
Kas
Tgl Keterangan Debet Kredit Nominal
Saldo Awal 14,587,381.00
1-Dec Bensin 20,000 14,567,381
Solar 198,000 14,369,381
Uang minum sopir ke Sei Landa 30,000 14,339,381
Uang minum kenek ke Sei Landak 30,000 14,309,381
2-Dec Solar 200,000 14,109,381
Penyeberangan Siantan-Singkawang 29,000 14,080,381
Penerimaan dari Abong (ST889776) 3,650,000 17,730,381
Uang keamanan (Ampera) 500,000 17,230,381
3-Dec Listrik (Ampera) 203,000 17,027,381
Penerimaan dari Asun (SN554026) 2,680,000 19,707,381
Solar truk hijau 200,000 19,507,381
Belanja ATK 200,000 19,307,381
Penerimaan dari Bintang Makmur (SM337889) 2,230,000 21,537,381
Beli materai 6000 70,000 21,467,381
Source: PT. Trisan Pakar Baja
39
accounts especially in faithful representation area that consist of
completeness, reliability, and free from error define several findings. In
completeness aspects, all of the accounts are completely present the amount
in financial statements. This can be proved based on the accounting process
of this company, where at the end of month the company will recapitulate
transactions especially the purchase to supplier based on the related
accounts for making the financial statement. The example of recapitulation
conducted by the company can be seen on Table 4.3. As for reliability and
free from error aspects, most the accounts already in complied, however
several errors found in that account. Regardless of all the account are in
terms of accrual basis and the journalized value are in accordance with
supporting documents such as bills, the errors are found in Hutang
Kendaraan Mobil Inova and Hutang Kendaraan Truk Dyna accounts in the
recorded value even though the date of recording are correct. The sample of
these errors can be found too in Figure 1.1 as the journal and Figure 3.3 as
the supporting document since the accounts that involved are connected
together.
40
TABLE 4.3
EXAMPLE OF RECAPITULATED TRANSACTIONS
LIST OF ACCOUNT PAYABLE ACCOUNT IN PT.
TRISAN PAKAR BAJA
Equity= The accounts that used by the company in this type consist of
Modal Awal and Laba. The purpose of the existence of these accounts to
indicate the current capital that company currently has. There is error
located on the amount of the Modal which happened due to the amount of
depreciation expense of credited vehicle. Due to the misstatement of
recording the value of the vehicle during the time of acquisition as
mentioned in the assets section. Since each month the company need to
create the monthly financial report, the company will recognize the
depreciation expense which come from the misstated amount of that
credited vehicle. From that time until right now, the amount of depreciation
expense will be accumulated in the Modal account in that company as the
result of none of adjustment conducted related with that situation.
Utang Dagang
Tgl Keterangan Debet Kredit Nominal
Saldo Awal 3,581,443,027.00
8-Dec Pelunasan tagihan ke SHP (HS-887923 & HS-887924) 124,336,000 3,457,107,027
19-Dec Pembelanjaan Stock Baru ke SHP (HS-1114267) 290,063,150 3,747,170,177
Source: PT. Trisan Pakar Baja
41
Revenue= The account that used by the company in this type only consist
of Penjualan Besi Beton. The purpose of the existence of these accounts for
indicate the main business activity that generating the revenue for the
company. In completeness aspects, the account comprehend with the
faithful representation. This can be proved based on the accounting process
of this company, where at the end of month the company will recapitulate
transactions based on the related accounts for making the financial
statement. The example of recapitulate conducted by the company can be
seen on Table 4.4. As for reliability and free from error aspects, the account
cleared these aspects too. All of the transactions that journalized related with
sales have been recorded based on the date that transactions happened
(accrual basis) which is date of the item delivered to the customers and
amount that accordingly based on the invoice.
Table 4.4
EXAMPLE OF RECAPITULATED TRANSACTIONS
LIST OF SALES REVENUE ACCOUNT IN PT.
TRISAN PAKAR BAJA
Penjualan
Tgl Keterangan Debet Kredit Nominal
1-Dec Kepada Abong (TS-8867813) 1,340,000 1,340,000
Kepada Asan (TS-8867814) 2,800,000 4,140,000
Kepada Bintang Makmur (TS-8867815) 6,280,000 10,420,000
Kepada Aneka Jaya (TS-8867816) 1,750,000 12,170,000
Kepada Bintang Terang (TS-8867817) 2,400,000 14,570,000
2-Dec Kepada Simpang Jaya (TS-8867818) 1,880,000 16,450,000
Kepada Jaya Abadi (TS-8867819) 3,150,000 19,600,000
Kepada ASUN (TS-8867820) 5,090,000 24,690,000
Kepada Bintang Makmur (TS-8867821) 1,120,000 25,810,000
Kepada Sahabat Kita (TS-8867822) 1,325,000 27,135,000
3-Dec Kepada Abong (TS-8867823) 1,325,000 28,460,000
Source: PT. Trisan Pakar Baja
42
Expense= The accounts that used by the company in this type consist of
Beban Pokok Penjualan, Biaya Kirim Besi, Biaya Operasional Kantor,
Biaya Gaji Karyawan, Beban Penyusutan, Biaya Umum & Lain-Lain. The
purpose of the existence of these accounts for supporting and ensure for
main operations of the company worked. In completeness aspects, all of the
accounts are in comprehend with the aspect. This can be proved based on
the accounting process of this company, where at the end of month the
company will recapitulate transactions based on the related accounts for
making the financial statement. The example of recapitulation conducted by
the company can be seen on Table 4.5. As for reliability and free from error
aspects, most the accounts cleared these aspects but, several errors found in
that account. All of the transactions that journalized related with respective
accounts in assets have been recorded based on the date of the transactions
happened (accrual basis) and amount that located in supporting documents
such as invoice, bills, or others. However, the errors are found in Beban
Penyusutan account in the amount that journalized even though the date of
recording are correct. This happened due to after effect from the error that
occurred in recording the acquisition value of credited vehicle that were not
same with the invoice.
43
TABLE 4.5
EXAMPLE OF RECAPITULATED TRANSACTIONS
LIST OF EXPENSE ACCOUNT IN PT. TRISAN PAKAR
BAJA
From the existing result from the checking, there are several error that need
to be readjusted in order to create better faithful representation of company financial
condition and as the preparation for converting all of existing accounts to the Intuit
Quickbooks. Therefore in the next section, it will be concern on how to solve the
error that happened in company especially in the misstatement issue.
Source: PT. Trisan Pakar Baja
44
4.2 Faithful representation (free from error) issue in PT. Trisan
Pakar Baja
Based on the Figure 4.1, the adding amount of total interest expense to the
book value of credited fixed asset (vehicle) will impact toward incompliance use of
existing accounting standard that is Pernyataan Standar Akuntansi Keuangan
(PSAK). These incompliance will create unreliable information related valuation in
financial statement. These issue itself can be considered as violation in faithful
representation aspect especially in free from error concept due to the transactions
are recorded in the wrong amount. The free from error aspects define that the
transactions need to be accurate in terms of amount and its estimation. With that
being said, the condition of the company had regarding with the credited fixed asset
(vehicle) is having issue with the free from error aspects in faithful representation.
Based on the conducted research methods, these action happened due to not
knowing the existing accounting standard treatment even though the all members
in Accounting & Finance Department having previous experience in accounting.
However, they confess that experience that they have only regarding about how to
record and process it into the financial statement with unawareness of the existing
regulations in PSAK. That resulting the all transactions that recorded by
Accounting & Finance Department mostly recorded in the total amount of each
transactions that will be charged only and recorded at the only time that transactions
happened since they think that the accounting treatment will be the same for all of
the account with only just record the same way as the other transactions. From that
45
point, it create the mind set for all members in Accounting & Finance Department
to record the transactions with the total amount that will be charged with that
transactions at the time transactions occurred without pay exact attention related
the treatment for each account.
The impact that connected with financial statement which are higher
depreciation expense amount that incurred by which created unreliable financial
condition of company. Also, this problem violates the PSAK No. 16 regarding fixed
asset. In the PSAK No.16 stated that the recognition of value of fixed assets is based
on the value at acquisition. As result from these action, the company understatement
profit. The comparison of those overstatment depreciation charge and the real value
charge can be seen in Table 4.6.
TABLE 4.6
COMPARISSON OF MONTHLY DEPRECIATION
CHARGE FOR CREDITED VEHICLE FIXED ASSETS
The monthly depreciation charge with misstatement of value occurred
The monthly depreciation charge with the real value that should be recorded
Source: Researcher
Type of Vehicles Recorded Value Useful LifeMonthly Depreciation
Charge
Kijang Inova 401,580,000 7 years (84 months) 3,887,857
Truk Dyna 356,200,000 13 years (156 months) 2,551,666
Type of Vehicles Recorded Value Useful LifeMonthly Depreciation
Charge
Kijang Inova 349,200,000 7 years (84 months) 3,264,285
Truk Dyna 326,300,000 13 years (156 months) 2,302,500
46
4.2.1 Proposed and Implemented Solution
a. Accounting treatment for the misstatement vehicle fixed assets
Since there is issue regarding overstatement of credited vehicle fixed assets
that need to be fixed in order to avoid the understatement of reporting the profit, the
discussion will lead in the way of researcher fixed the overstatement through
adjustment in the value of credited fixed assets. In order to create the faithful
representation information for financial statement, company need to change the
amount into real book value at the time of acquisitions. The book value according
to PSAK No.16 is the value at acquisition only without adding other component
which is value that existed in the invoice. Also, the amount of interest expense that
need to be paid during each month will be seperated and recorded when only paid.
All of these steps are necessary in order to comply with PSAK concept in recording
and reporting the fixed asset. Also, the accumulated depreciation account will be in
the seperated from the fixed asset account and act as the contra account of that
account.
Therefore, adjustment entries will be necessary to solve the valuation
problem of fixed asset there will be need of necessary adjustment entries for the
fixed asset vehicle account and the account payable amount that affected due to this
transactions. The adjustment journal for this kind of condition can be shown in
Figure 4.2.
47
FIGURE 4.2
ADJUSTMENT JOURNAL FOR MISTATEMENT
VALUE OF VEHICLE
For Kijang Inova adjustment
For Truk Dyna adjustment
The purpose in Figure 4.2 is to adjust and change the book value of vehicle
fixed assets based on the invoice supporting documents. The other purpose of these
entries to recognize the interest expense that previously omitted by deducting
(debitting) the amount into “Modal Awal” since this account represent as retained
earnings account for the company. According to the Head of Accounting &
Finance, the vehicle were ready to use at the point of invoice been issued by the car
agent. That means there are no additional cost indicating the increasement of the
value and lead to adjustment for that value for congruent with the documents. As
for the interest expense itself, it will only been incurred when the point of the
Source: PT. Trisan Pakar Baja
48
company monthly paid the payable to the car agent. Since the main purpose of this
research is record all of existing transactions into the Intuit Quickbooks for creating
the financial statements, the recordings of Figure 4.2 in the version of Intuit
Quickbooks will be displayed in the implementation section.
The depreciation expenses amount for the next month onward will be based
on the new book value. The depreciation method for all fixed assets in vehicle tend
to be same with previous by using straight line method. The company will monthly
charge of depreciation value based on the new value of that fixed assets and
continue to based on useful life continuationof the vehicle. From that point, the
depreciation will still continue for the rest of useful life with different value of
depreciation. Therefore, the comparisson before and after adjustment for the book
value of vehicle fixed assets toward depreciation rate charge and its useful life can
be seen in Table 4.7.
49
TABLE 4.7
REVISION OF RECOGNITION OF VEHICLE AFTER
ADJUSTMENTS
Before adjustment condition
After adjustment condition
In Table 4.7 provide the effect of each vehicle adjustment of its book value.
From the adjustment of vehicle fixed asset resulting into lower amount which
impact toward decreasing of monthly depreciation rate. Since the asset already been
used for several months, the Table 4.7 present the remainning useful life for the
asset can still be used by the company.
The impact of the adjustment resulting toward the change of recording the
account especially related on payment of monthly installment to be more detailed
Date Acquired Recorded Value
Current payable for
vehicle assets (31 Dec.
2017)
Useful Life Residual Value
Depreciation
rate per
month
8/11/2017 Rp 401,580,000
379,200,000 (payable for
3 years since acquisitions
15% interest)
7 years (6 years 10
months remained) Rp 75,000,000 Rp3,887,857
5/10/2017 Rp 356,200,000
311,675,000 (payable for
2 years with 10% of
interest)
10 years ( 9 years 9
months remained) Rp 50,000,000 Rp2,551,666
List of Credited Fixed
Assets
Kijang Inova
Truk Dyna
Date Acquired Recorded Value
Current payable for
vehicle assets (10 Jan.
2018)
Useful Life Residual Value
Depreciation
rate per
month
8/11/2017 Rp 349,200,000
379,200,000 (payable for
3 years since acquisitions
15% interest)
7 years (6 years 10
months remained) Rp 75,000,000 Rp3,264,285
5/10/2017 Rp 326,300,000
311,675,000 (payable for
2 years with 10% of
interest)
10 years ( 9 years 9
months remained) Rp 50,000,000 Rp2,302,500 Truk Dyna
List of Credited Fixed
Assets
Kijang Inova
Source: PT. Trisan Pakar Baja
50
and not omit the interest expense anymore. The recordings can be seen on Figure
4.3.
FIGURE 4.3
REVISION FOR MONTHLLY INSTALLMENT
PAYMENT OF VEHICLE
Then, the before and after result of implemented solution for these issue
regarding the book value of vehicle asset and its depreciation at December 2017
and January 2018 month can be seen in the form of partial statement of financial
position in Figure 4.4.
Source: PT. Trisan Pakar Baja
51
FIGURE 4.4
REVISION OF RECOGNITION OF VEHICLE IN
FINANCIAL STATEMENTS
4.3 Timeliness issue in generating monthly financial report
Based on Figure 4.1, delayed and slow process in generating the monthly
financial report will eventually impact toward company’s operations which relied
for future decision making process. Nowdays, these monthly financial statement is
for the high-level manager to make decision and know the condition of the
company. The other use of this information by this company is to decide the product
that need to be re-ordered due to the and other product that need to be cut off due
to lower demand from customers. Moreover, the other function for these monthly
financial statement as the base is providing the bonus reward to General Manager
from Superiors in PT. Trisan Pakar Baja when the company is in profitable
condition.
Source: PT. Trisan Pakar Baja
52
The delay in generating the financial report mostly in two or three weeks
later after the end of month. That preparation of the information generated regarding
the financial conditions of the company tend to be less timely and resulting the
lateness in decision making. Also, making the General Manager behave less
motivated since the reward given too late even though the company in profitable
condition. This case happened due to only two persons in this department and other
tasks that need to be done by Accounting & Finance Department other than
journalizing and generate monthly financial statement that can be seen in Figure
4.5. As the result, this condition created accounting information that were not
timely generated on time since the journalizing was condcuted during near end of
working time.
FIGURE 4.5
ACCOUNTING & FINANCE DEPARTMENT JOB
DESCRIPTION
Source: PT.Trisan Pakar
Baja
Statement
53
4.3.1 Proposed and Implemented Solution
In order to create timely monthly financial statement for management, the
company need to change their accounting process from manual accounting process
to the software based accounting process by using Intuit Quickbooks. However,
initial setup is needed to operate the software. The step that will be initial setup
explained as it follows.
4.3.1.1 Installation and Chart of Account Setup in Intuit Quickbooks
The first setp is to setup regarding chart of accounts and balance amount.
According to the previous existing chart of account in creating monthly financial
report, there are nineteen accounts in total and the details can be seen in Table 4.8.
TABLE 4.8
PT. TRISAN PAKAR BAJA’S CHART OF ACCOUNT
BEFORE CONVERTING INTO INTUIT QUICKBOOKS
From the Table 4.8, there will be few expansion of accounts that will be
added to the current chart of account. The reason behind it due to the neccessity in
providing detailed report and categorization in each part of account. Therefore, in
Kas & Bank Hutang Usaha/ Dagang Modal Awal Penjualan Besi Beton Beban Pokok Penjualan
Giro yang belum jatuh tempo Hutang Kendaraan Mobil Inova Laba Biaya Kirim Besi
Piutang Usaha Hutang Kendaraan Truk Dyna Biaya Operasional Kantor
Persediaan Barang Dagang Biaya Gaji Karyawan
Kendaraan Beban Penyusutan
Bangunan Biaya Umum & Lain-Lain
Akumulasi Penyusutan Kendaraan
Total Asset accounts= 7 Total Liabilities account= 3 Total Equity Accounts = 2 Total Revenue account= 1 Total Expenses account= 6
Assets Liabilities Equity Revenue Expenses
Source: PT. Trisan Pakar Baja
54
each categories of account of asset, liabilities, equity, revenue and expenses there
will be added with additional account that still related with company’s daily
operations for the purpose of detail reporting of monthly financial statement.
In asset account there will be added with another thirteen accounts. The
accounts that getting the additional expansion mainly refer to account that have
several balance in different place for example cash that being kept in the bank. Since
this company mostly keep their money in several bank, it is necessary to provide
several new accounts in order to know the balance amount of cash in each different
bank before accumulated into single amount. Also, the other expansion for the
accounts refer to account of fixed assets that owned by the company. These
expansions are necessary since the company acquired a lot of fixed assets and
categorization will be provide better self-assessment for the company on how is the
money being used in acquiring fixed assets.
As for liability and equity account there will be another two accounts. The
reason for the adding the accounts that related in liabilities is to provide better
distinguishment for account payable that resulting from purchase of goods with
other payabale that coming from salaries payable, and third-party payable since
these transactions were not same at all. By providing these expansions, it will help
the company to know their liabilites condition that currently faced on.
Finally, for revenue and expenses account additional of sixteen accounts
will be added. The expansions mainly toward the expenses account only. The
reasons for these expansions conducted are for better categorization of expenses
55
based on each activiity occurred in the company and provide better information for
the company to judge what kind of expenses that can be reduced or optimized more.
In the total of fourty eight accounts established for PT. Trisan Pakar Baja’s
chart of accounts in creating the monthly financial report. Whereas the established
chart of account in Intuit Quickbook of the assets accounts in total of twenty
accounts can be seen in Figure 4.6.
56
FIGURE 4.6
ESTABLISHED CHART OF ACCOUNT USING INTUIT
QUICKBOOKS (ASSETS ACCOUNTS)
As for the liability and equity accounts that already established contained
five accounts in liability and two accounts in equity. The content chart of accounts
in liability and equity accounts can be seen in Figure 4.7.
Source: PT. Trisan Pakar Baja
57
FIGURE 4.7
ESTABLISHED CHART OF ACCOUNT USING INTUIT
QUICKBOOKS (LIABILITIES AND EQUITY
ACCOUNTS)
Then, for the revenue and expenses accounts that already been established
in Intuit Quickbooks contained one account for revenue and twemty one account
for the expenses. The chart of account content in revenue and expenses accounts
can be seen in Figure 4.8.
Source: PT. Trisan Pakar Baja
58
FIGURE 4.8
ESTABLISHED CHART OF ACCOUNT USING INTUIT
QUICKBOOKS (REVENUE AND EXPENSES
ACCOUNTS)
All of these new established chart of account in Intuit Quickbooks will be
used to create the monthly financial statement. Where all of accounts represent the
activity that occurred in company operations.
4.3.1.2 List of Vendors, Inventory, and Customers Setup in Intuit Quickbooks
The second step that need to done by inputting the list and information
regarding the name of customers, suppliers, and inventory. In order to input that
Source: PT. Trisan Pakar Baja
59
kind of data, it will refer to the list of customers and suppliers that already been
previously created by the company which can be seen in Figure 4.9.
FIGURE 4.9
LIST OF CUSTOMERS AND VENDORS OF PT. TRISAN
PAKAR BAJA
As for the list of inventory, it will be refer to the previous month inventory
evaluation summary (December 2017) in order to state the existing quantity, cost,
and price of each products which can be seen in Table 3.2. The example result of
inputted customers, suppliers, and inventory list can be seen in Figure 4.10, 4.11,
and 4.12.
Source: PT. Trisan Pakar Baja
61
FIGURE 4.11
ESTABLISHED VENDORS LISTS USING INTUIT
QUICKBOOKS
FIGURE 4.12
ESTABLISHED INVENTORY LISTS USING INTUIT
QUICKBOOKS
62
4.3.1.3 Balance Amount and Accounting Period Setup in Intuit Quickbooks
After the customers, vendors, and inventory list has been inputted, the third
step concern with inputting the beginning balance amount in fixed accounts of
assets, liabilities, and equity. The balance amount for the input will refer with
previous monthly financial report (December 2017) which can be seen from Figure
3.1, 3.2 and Table 3.2. Since there are several new accounts added that can be seen
in Figure 4.10, 4.11, and 4.12, the inputted value of the account based on
categorization of main category type of transactions from tracing the general
journal record in December 2017. As for the transactions that cannot be traced back
in December 2017, it will be based on direct information from staff of Accounting
& Finance Department to provide the amount since they manage the record and
documents of needed balance accounts. In terms of accounting period adopted, it
will adopting the calender year that started from 1st January until 31st of December
due to the company usually prepared the financial statement monthly that started
from the beginning of January until end of that January. To input the beginning
balance of each accounts, it can be done during the establishing the “Chart of
Accounts”. During the adding accounts to the chart of account, the user can input
the beginning balance by clicking the icon “Enter Opening Balance” in Figure 4.13.
63
FIGURE 4.13
FIRST STEPS IN ADDING BEGINNING BALANCE
ACCOUNT IN INTUIT QUICKBOOKS
In that section, the user will input the corresponding beginning balance that
can be seen in Figure 4.14 and clicking “OK” to confirm it . After that, by clicking
“Save & Close” it will save the current beginning balance that already been
inputted.
64
FIGURE 4.14
SECOND STEPS IN ADDING BEGINNING BALANCE
ACCOUNT IN INTUIT QUICKBOOKS
After the user already inputted the beginning balance of accounts, the user
able to add to new account with their respective beginning balance by clicking
“Save & New” on that menu displayed.
4.3.1.4 Generalization of Inputing The Transactions to Intuit Quickbooks
In order to create the effective use of Intuit Quickbooks software as the new
computerized accounting process, generalization of recording transactions in Intuit
Quickbooks is necessary to avoid wasting time resources. The main point to
conduct this in order to know what exactly need to be input to the software when
65
facing different kinds of transactions during operations. Therefore, the all
categories of this company’s transactions can be divided into main ten types of
transactions /cycles based on distinction of activies conducted in PT. Trisan Pakar
Baja. The details of transactions seperation based on its own catagories stated can
be seen in Table 4.9.
TABLE 4.9
TYPES OF PT. TRISAN PAKAR BAJA’S
TRANSACTIONS
From the catagorization of transactions into ten points, the generalization
can be conducted in order to create consistency of recording the transactions. This
Source: PT. Trisan Pakar Baja
No. Transactions/ CycleAction for Input in Intuit
Quickbooks
1 Selling Activity
2Receiving Payment from
Supplier
3Buying Inventory from
Supplier
4 Payment to Supplier
5 Deposit Money to Bank
6Liquidize the Giro to
Bank Account
7Employee Salary
Payment
8
Payment for Monthly
Expenses (Example:
electricity, water,
telephone)
9
Payment for Sudden/
Other Unexpected
Expense
10Depreciting the Fixed
Assets
Special Entries Provided
by Intuit Quickbooks
General Journal Entries
Input to Intuit
Quickbooks for
Recording and
Adjustments
66
creation will be based on chart of account that previously created. Then, it will
become the guidance for the staff to record the transactions to the software with
established pattern. Moreover, as the part of Intuit Quickbooks features, there are
special journal provided in handling several transactions for creating convenience
recording compared inputting in general journal. Whereas according to Table 4.9,
special entries will be utilized in transactions from number 1 until 6, and as for
transactions number 7 until 10 will be in form of general journal.
By the implementing the Intuit Quickbooks to the company’s accounting
process, it will constructed the condition of recording the transactions based on all
ten main types of transactions into Intuit Quickbooks by using the data flow
diagram. The data flow diagram created as the result of implementing these
software. Also, the other fucntion for the creation for data flow diagram especially
provide the insight regarding the timing of recording conducted in Intuit
Quickbooks. The data flow diagram for PT. Trisan Pakar Baja can be divided into
three data flow diagrams that cover up each own features. The first data flow
diagram can be seen in Figure 4.15, which covers up the operational activity of the
company in dealing the customers.
67
FIGURE 4.15
DATA FLOW DIAGRAM OF PT. TRISAN PAKAR BAJA
SALES TRANSACTIONS
Then, the next data flow diagram can be seen in Figure 4.16. This diagram
will covers up the purchasing activity that deals with the supplier.
68
FIGURE 4.16
DATA FLOW DIAGRAM OF PT. TRISAN PAKAR BAJA
PURCHASING TRANSACTIONS
The next the data flow diagram will covering up the other kinds of
transactions that occurred in the company such as payment for expenses or any
activities that do not related with main activity of the company. The next data flow
diagram can be seen in Figure 4.17.
69
FIGURE 4.17
DATA FLOW DIAGRAM OF PT. TRISAN PAKAR BAJA
FOR OTHER TRANSACTIONS
With the data flow diagram from the Figure 4.15, 4.16, and 4.17, the
company will create the monthly financial statement that covers up from the all
transactions that occurred in that period. The data flow diagram of these process
can be seen in Figure 4.18.
70
FIGURE 4.18
DATA FLOW DIAGRAM OF PT. TRISAN PAKAR BAJA
OF MONTHLY FINANCIAL STATEMENT
Based on Figure 4.15, 4.16, 4.17, and 4.18 the process of recordings of Intuit
Quickbooks in this company will refer to any of documentation evidence in form
of the copy of orders, or bill that already received and the recordings can start after
that receoving the document. From the recordings of the transactions to Intuit
Quickbooks, the user capable to command the software to create the financial
statement whenever needed.
The process of recordings using Intuit Quickbooks can be start from the
menu of “Accountant Center” in that program which can be seen in Figure 4.19.
From that menu, the user can utilize the recordings of the transactions especially in
special entries to input using the “Tools” section in that menu. In that sections
covers up on activity of sales, purchasing, payment, and receiving payment that
requires the special entries. As for the transactions that do not require special
71
journal, the user will only use “Make General Journal Entries” function to record
the transactions.
FIGURE 4.19
ACCOUNTANT CENTER MENU IN INTUIT
QUICKBOOKS
In “Accountant Center” Menu that can be seen in Figure 4.19, it can be
distinguished into four main parts that provided by the Intuit Quickbooks which are
“Tools”, “Reconciliation”, “Memorized Reports”, and “Accountant Updates”. The
explanation for each parts related on its function can be seen down below:
Tools= It refers to function of the company can do for conducting the
recording of the transactions. In this function, it has fourteen features that can used
by the compay. The first is “Create Sales Order” for make the sales order from the
sales activity. Second is “Create Invoice” for make the invoice after the sales order
been issued. Third is “Receive Payment” for record the payment that got by the
72
customers. Fourth is “Create Purchase Order” for make the purchase order when
the company wanted to purchase something to supplier. Fifth is “Receive Items and
Enter Bill” for the record then the company receive their items and bill after
deleivery from supplier. Sixth is “Pay Bills” for settle the payable to the supplier.
Seventh is “Make Deposits” for the company that need to deposit their cash to the
bank. Eighth is “Transfer Funds” for the purpose of liquidize the giro into the banks
accounts balance. Ninth is “Item List” for provide the information to the company
related with types and quantity of inventory. Tenth is “New Item” for the company
that wanted to add new type of product to sale to the customers. Eleventh is “Adjust
Quantity/ Value on Hand” for the company that wanted to manually adjust the
quantity of inventory when there is difference with the recordings and actual.
Twelveth is “Make General Journal Entries” for the company that wanted to record
other types of transactions from sales or payment activities. Thirteenth is “Working
Trial Balance” for the purpose of showing the current balance of each accounts
before process it into the financial statement”. The last one is “Set Closing Date”
for the purpose of setting the closing cut-off recording of the transactions in order
to be able process it into the financial report.
Reconciliation= It refers the function for the company to adjust the balance
of bank accounts with the actual balance that currently hold right now.
Memorized Reports= It refers the function to the company to easily pick the
type of reports that company wanted to generate it directly.
Accountant Updates= It refers the functions that provide insights in business
and in how to use these software properly.
73
In recording selling activity using the Intuit Quickbooks require the special
entries for inputting the transactions. It started from clicking the “Create Sales
Order” menu in Intuit Quickbooks that can be seen from Figure 4.20. After the
generating invoice, Intuit Quickbooks automaticly recorded as part of transactions
that occurred for this month.
FIGURE 4.20
CREATING THE SALES ORDER IN INTUIT
QUICKBOOKS
After the sales order has already been generated, the next step is processed
into “Create Invoice” menu for making the this transactions approved to impact
toward the balance amount. After the sales order completed in Figure 4.20, by
clicking “Save & Close” it will go back to “Accountant Center” Menu. Then, by
choosing “Create Invoices” menu, it will go to the specific menu entries. Which the
74
user will choose the sales order that previously been created and it will directly
converted into the invoice. The invoice has already been generated by Intuit
Quickbooks can be seen in Figure 4.21. After the invoice already inputted, click the
“Save & Close” to record these transactions.
FIGURE 4.21
PROCESSING THE SALES ORDER INTO INVOICE IN
INTUIT QUICKBOOKS
As for the receiving payment transactions, the users can directly go to the
“Receiving Payment” menu in “Accountant Center” and it will create the certain
special entries. In this type of transactions, the user can direclty select the name of
customers first and input the number of payment to settle the receivable that owed
by customers which can be seen in Figure 4.22. After the record of payment already
75
been inputted, the user can click “Save & Close” icon to save the record of the
transactions.
FIGURE 4.22
INPUTTING THE CUSTOMERS PAYMENT IN INTUIT
QUICKBOOKS
In recording buying inventory from supplier using the Intuit Quickbooks
require the special entries for inputting the transactions itself. Where it started from
the “Create Purchase Order” menu in “Accountant Center” section on Intuit
Quickbooks that can be seen from Figure 4.23. After the generating bill, Intuit
Quickbooks automaticly recorded itself as part of transactions that occurred for this
month.
76
FIGURE 4.23
CREATING THE PURCHASE ORDER IN INTUIT
QUICKBOOKS
After the purchase order already been inputted, the user can click “Save &
Close” to continue to another step which processed it into “Received Items and
Enter Bill” in “Acountant Center” menu. The bill generated by Intuit Quickbooks
can be seen in Figure 4.24. After the bill already been inputted, it need to be saved
by clicking “Save & Close” to save the record of the transactions.
77
FIGURE 4.24
PROCESSING THE PURCHASE ORDER INTO BILL IN
INTUIT QUICKBOOKS
As for the settling payment to supplier transactions, the users can directly
go to the “Pay Bills” menu in “Accountant Center”. In this type of transactions, the
user can direclty select the name of suppliers first and selecting alongside with input
the number of payment to settle the payable that owed by supplier which can be
seen in Figure 4.25. Then, the payment summary will appeared after the deciding
which payment to settle with supplier which can be seen in Figure 4.26. After the
record of payment already been saved, Intuit Quickbooks automaticly recorded
itself as part of transactions that occurred for this month.
78
FIGURE 4.25
INPUTTING THE PAYMENT TO SUPPLIER IN INTUIT
QUICKBOOKS
After selecting the transactions that need to be settled. the payment
summary will appeared after the deciding which payment to settle with supplier
which can be seen in Figure 4.26. By clicking “Done” it will confirm and saved the
payment that already been conducted with the supplier.
79
FIGURE 4.26
THE PAYMENT SUMMARY IN INTUIT QUICKBOOKS
Then for the deposit money to bank transactions, the users can directly go
to the “Make Deposits” menu in “Accountant Center”. In this type of transactions,
the user can direclty selecting the bank account that need to be deposit alongside
with inputting the amount to be deposit to that bank account which can be seen in
Figure 4.27. After the record of deposit already been inputted, it need to be saved
by clicking “Save & Close” to record these transaction.
80
FIGURE 4.27
INPUTTING THE FUND TRANSFER TO BANK
ACCOUNT IN INTUIT QUICKBOOKS
Next, for the liquidizing giro transactions, the users can directly go to the
“Fund Transfer” menu in “Accountant Center” and it will create the certain special
entries. In this type of transactions, the user can direclty selecting the bank account
that need to be deposit by the liquidized giro alongside with inputting the amount
which can be seen in Figure 4.28. After the record of deposit already been inputted,
it need to be saved by clicking “Save & Close” to record these transaction.
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FIGURE 4.28
INPUTTING THE LIQUIDIZED GIRO AMOUNT TO
BANK ACCOUNT IN INTUIT QUICKBOOKS
Regarding the payment for employee salary, the user need only use “Create
General Jorunal Entries” menu in “Accountant Center”. After that, the input the
conducted based on respective account and value of the transactions. For the
recording of these transaction in Intuit Quickbooks can be seen in Figure 4.29.
FIGURE 4.29
RECORDING FOR SALARY PAYMENT INTO INTUIT
QUICKBOOKS
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Next for the payment for monthly expenses such as electricity, water &
phone, the user need to use “Create General Jorunal Entries” menu in “Accountant
Center”. After that, the input the conducted based on respective account and value
of the transactions. This condition will be applicable for any kind of expenses that
incurred monthly and with using the expenses account that already created in chart
of account. For the recording of these transaction in Intuit Quickbooks can be seen
in Figure 4.30.
FIGURE 4.30
RECORDING FOR MONTHLY EXPENSES PAYMENT
INTO INTUIT QUICKBOOKS
After that, for the payment for sudden expenses such as, the user need to
use to use “Create General Jorunal Entries” in “Accountant Center” menu. After
that, the input the conducted based on respective account and value of the
transactions. The user need to put these type of transactions into “Beban Lain-Lain”
as the expense account that set in chart of account and since this expense did occur
daily too. For the recording of these transaction in Intuit Quickbooks can be seen
in Figure 4.31.
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FIGURE 4.31
RECORDING FOR SUDDEN EXPENSES PAYMENT
INTO INTUIT QUICKBOOKS
Finally, for the depreciation of fixed assets, the user need to use “Create
General Jorunal Entries” in “Accountant Center” menu. After that, the input the
conducted based on respective account and value of the transactions. For the
recording of these transaction in Intuit Quickbooks can be seen in Figure 4.32.
FIGURE 4.32
RECORDING FOR DEPRECIATION OF FIXED ASSETS
INTO INTUIT QUICKBOOKS
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The manual adjusting entries that previously conducted in Figure 4.2 and
Figure 4.3 need to be inputted to Intuit Quickbooks as the new accounting process
of this company. The recordings from Figure 4.2 into Intuit Quickbooks can be seen
on Figure 4.33.
FIGURE 4.33
RECORDING ADJUSTMENT JOURNAL FOR
MISSTAMENT VALUE OF VEHICLE INTO INTUIT
QUICKBOOKS
For Kijang Inova adjustment
For Truk Dyna adjustment
Source: PT. Trisan Pakar Baja
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Then, for the recordings from Figure 4.3 into Intuit Quickbooks can be seen
in Figure 4.34.
FIGURE 4.34
RECORDING FOR MONTHLY INSTALLMENT
PAYMENT OF VEHICLE INTO INTUIT QUICKBOOKS
The all constructed solutions that provided by the researcher already been
implemented by the company after the installation of the software succesfully
conducted.
4.3.1.5 Creating Financial Statement in Intuit Quickbooks
Next, after the all transactions already have been recorded for one month,
the user can directly generate the monthly financial statement by using the
“Memorized Report” sections in Accountant Center menu. The content of monthly
financial statement prepared for General Manager consisted of Income Statement
(Profit & Loss), Statement of Financial Position ( Balance Sheet), and Inventory
Source: PT. Trisan Pakar Baja
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Valuation Summary. The example of monthly financial report generated by using
Intuit Quickbooks can be seen in Figure 4.35, 4.36, and Table 4.10.
FIGURE 4.35
INCOME STATEMENT GENERATED BY INTUIT
QUICKBOOKS
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TABLE 4.10
INVENTORY EVALUATION SUMMARY GENERATED
BY INTUIT QUICKBOOKS
Based on the monthly financial statement generated by the Intuit
Quickbooks, the General Manager in PT. Trisan Pakar Baja will evaluate the
current performance of the company. The Geneal Manager decision on making
supply of inventory will be based on the financial condition of the company and the
Inventory Evaluation Summary generated. When the financial situation of the
company in profit condition, the General Manager will look Inventory Evaluation
Summary as the foundation in deciding the most bought inventory during one
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month by looking at the percentage of retail form the report as the decision to buy.
Based on the Figure 4.46, the General Manager of PT. Trisan Pakar Baja re-order
the inventory according to percentage of retail of current month for each type of
product more than the ten percent of total retail. Which the ten percent is the
percentage that already been decided previously by the upper level management
especially when they wanted to resupplied the inventory. With that being said, the
General Manager will re-order the product which are:10 LSP; 10 SHP; 12 BDS; 12
SII; 13 DMK. Since the monthly financial report can be generated at any time the
General Manger wanted, the timeliness issue can be cured especially for the General
Manager side in making economic decision. With Intuit Quickbooks implemented
in this company, the Accounting & Finnace Department do not have heavy burden
in generating monthly financial report due to the program capability in automaticly
process the monthly financial report only by inputting the transactions occurred in
one month.
Alongside generating the financial statement from the Intuit Quickbooks,
the company also created the financial statement from the manual process for the
period of January 2018. The reason the company make two version of financial
statemet is for comparing each other in terms of accuracy. The financial report that
manually generated by the company for the period of January 2018 can be seen in
Figure 4.37, 4.38, and Table 4.11.
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FIGURE 4.38
STATEMENT OF FINANCIAL POSITION MANUALLY
GENERATED BY PT. TRISAN PAKAR BAJA FOR
JANUARY 2018
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TABLE 4.10
INVENTORY EVALUATION SUMMARY MANUALLY
GENERATED BY PT. TRISAN PAKAR BAJA FOR
JANUARY 2018
From the conducted comparisson, it can be found that the financial
statement that generated from both are generally same. Which can be seen that the
total amount of each monthly financial statement are clearly same. It can be said
93
that both version of financial statement are accurate in terms of amount that
presented. In terms of accuracy the both version can be accurate, when in terms of
timeliness it is different things. In Intuit Quickbooks, the Accounting & Finance
Department can easily generate the financial statement that they want at any time.
Different situation in terms of manual process that previosly adopted by company
requires 2 weeks after the end of month to generate the financial statement. Which
it is obvious that using the Intuit Quickbooks can out perform than manual process
that adopted by the compay previously by only having one person operate to
generate those report less than ten minutes.
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CHAPTER V
CONCLUSION AND RECOMMENDATION
5.1. Conclusion
The researcher already conducted the converting the accounting process that
PT. Trisan Pakar Baja adopted which is conventional method into the new
accounting process using Intuit Quickbooks. The reason for conversion conducted
due to PT. Trisan Pakar Baja having the issues related decision making for re-stock
the inventory getting halt due to delay in generating in financial statement. Where
these delay appeared due to the personnel in Accounting & Finance Department
lack of staff and they have other duties that need to be fulfilled other than
journalizing the transactions and create the financial statement. Therefore, to avoid
these delay the conversion conducted from the previous method that adopted by the
company into the new accounting process using the Intuit Quickbooks to improve
and solve timeliness issue. The improvement can be seen from two weeks needed
to create the monthly financial statement into less than ten minute, since Intuit
Quickbooks capable to process all of the existing transactions into monthly
financial statement by having one person to operate that software.
During the conversion process that conducted toward the accounting
process of PT. Trisan Pakar Baja, the researcher found out that the companies also
have another issue with the misstatement in recording the amount of credited
vehicle fixed assets. These misstatement resulting the overstatement in that assets
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with the total amount of Rp.82.280.000. These will impact to other account such as
the depreciation expense getting over charged every month in the total of
Rp.872.738. That resulted the decrease of the profit for 1% of the total net income.
These issue itself fall within the area of faithful representation especially in free
from error aspect since it is misstatement of the amount that presented in financial
statement. This condition happened as the result of lack of experience and
unawareness related with the existing accounting regulation in treating each of
account. From the analysis obtained and conducted, researcher can summarize that:
There are two factors that researcher having issues which are faithful
representation and timeliness in generating the financial statement. Where these
issues need to be solved in order to create reliable information provided by financial
statement and avoid any potential new issues that happened to the company.
There are detail solution, changing effect, and template for recording the
transactions already been provided and implemented in order to make PT. Trisan
Pakar Baja able to operate efficiently and create timely and reliable financial
statement. There are Accounting & Finance Department job description,
categorization of company’s transactions, and established pattern of recordings to
Intuit Quickbooks based on type of transactions.
5.2. Recommendation
The future research is necessary to expand the research in other factors
besides the journalizing and reporting in accounting process, accounting treatment
for the certain account. Future research also able to take the same topic with
implemented on other companies.
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