You can enable the Anglo Saxon type of accounting from the Accounting module settings. Anglo Saxon type is mainly used by the small communities.

1. Odoo 15 Anglo Saxon &
Continental Accounting
in Odoo 15
www.cybrosys.com

2. INTRODUCTION
 The two main types of accounting practiced widely are the continental accounting and
anglo saxon accounting.
 Continental type of accounting is the most used type of accounting, Anglo saxon type on
the other hand is mainly used by the small communities.
 By default the Odoo uses continental type of accounting. You can enable the anglo saxon
type of accounting from the Accounting module settings.
 The continental type of accounting the amount of the goods is recorded as soon as the
product is received in the stock, where on the other hand in an anglo saxon type of
accounting the cost of the goods is recorded at the time of sale or delivery.

3.  To switch to anglo saxon type of accounting, first select the Settings option from the
Configuration tab of the Accounting module. Under the Accounting menu you can enable
Anglo saxon Accounting. By saving the changes, your further accounting will be executed in
the anglo saxon type.
 In Continental type of accounting the cost of goods and services is taken into account when
the product is received in the stock. In the case of Anglo Saxon type of accounting the cost is
recorded as expense only when the goods is invoiced to a final customer.

4. Accounting -> Settings -> Setup

5.  The accounting entries to value the inventory are not posted automatically when a product
enters or leaves the company. Moreover, while creating a new customer the payable account
is ‘Account payable’ and the receivable account is ‘Account receivable’ for understanding the
flow of journal entries
 when you purchase a product for a certain amount, the money you have to pay is affected in
this account.
Manual Inventory Valuation

7.  Here the Accounts Payable can be described as the payable account for the vendor,

8.  The accounts receivable over here can be defined as the receivable account of the customer.

9.  Product -> Select a Product -> Product Category

10.  Here is the Income account: When a product is sold, the Revenue will be used to record
the transaction based on the sale price, used while validating a customer invoice.

11.  In the expense account, the expense is accounted for when a vendor bill is processed
here, it is set as Purchased Goods.

12.  An accounting entry is automatically created to value the inventory when a product enters or
leaves the company.
 Moreover, the same product is considered with its inventory valuation as ‘Automated’ and selects
the corresponding accounts for each movement. Now set a vendor for the product and the price
of that product for which the vendor is selling.
Automatic Inventory Valuation

13.  Product -> Select a Product -> Product Category

14. Stock Valuation Account:
When a real-time inventory valuation is enabled on a product, this account inventory will hold the current value
of the product.
Supplier Invoice Validation
purchasing a product from a vendor and its actual price is 45/-, in this case, I have received the bill first,
but the product is not received yet. Then the ‘Expense’ ie, the Expense Account and the account
payable is affected.

16.  The balance sheet is also affected with the same change

17.  Done payment against my order and you can see that the Bank account is affected.
 Receive the product and will generate an entry for the Inventory ie the stock valuation
account.

18.  purchasing a product from a vendor and its actual price is 45/-, but before paying the
amount, the product is received. Then the stock valuation account and the stock input
account is affected with corresponding entries.
 the changes can also be viewed in the balance sheet of the platform
 while receiving the bill against the purchase, then the Accounts payable and Purchase
expense are affected by the purchase order
Supplier Goods Reception

19.  The similar effect can be seen in the balance sheet

20.  Selling this product to my customer and I have given the bill for the order. Then while processing
it, the ‘Goods’ ie, income and the ’Account Receivable’ account is affected with an entry.
Customer Invoice

21.  Similar implications can be seen in the balance sheet also

22.  Now when the customer has paid the amount for the corresponding order then ‘Bank’ is affected
with the payment
 delivered the product, it will generate an entry for the ‘Inventory’ i.e. the stock valuation account

23. Anglo-Saxon Accounting
Set the accounting configuration as Anglo-Saxon accounting. Accounting module > Settings >
Bank & Cash > tick the Anglo-Saxon accounting > save.

24. Manual Inventory Valuation
 Set the Products Property accounts for implementing Anglo Saxon with a manual inventory
valuation.

25.  The Income account is used when a product is sold, the Goods will be used to record the
transaction based on the sale price, used while validating a customer invoice.
 The Expense account when a vendor bill is processed, in Anglo-Saxon with perpetual
inventory valuation in which case the expense is recognized at customer invoice validation

26. Supplier Invoice Validation
 purchasing a product from a vendor and its actual price is 45/-, in this case, I have received the
bill first but the product is not received yet. Then the accounts affected will be the Cost of Goods
Sold and Account Payable with an entry.
Supplier goods reception
 In this action, no journal entries are being added.

27. Customer Invoice
 Selling a product to customer and have given the bill for the order. Then while processing it, the
accounts Goods and Account Receivable are affected with an entry.
Customer Shipping
 During this action no entries are being posted.

28. Automatic Inventory Valuation
change the product category to ‘Automated’

29. Supplier Invoice Validation
 A Request for Quotation (RFQ) is used when you plan to purchase some products and you would
like to receive a quote for those products. purchasing a product from a vendor and its actual price
is 45/-, but the bill for the order is received first.

30.  In the Purchases -> Create Request for quotation -> add Products

31.  The Stock Input account and the Accounts Payable accounts are affected with an entry for the
corresponding order
 While paying the amount against the bill the Bank account is affected.

32. ❖ Supplier Goods Reception ⤍ Then we have purchased a product from the vendor but the
product is received first before paying the amount. Then the Stock valuation account i.e.,’
Inventory’, and the Stock input account i.e. here ‘Goods received not purchased’ is affected
with corresponding entries as depicted in the following image.

33. ❖ Additionally, when the supplier gives the bill, then the Accounts payable is affected by the corresponding
purchase.

34. ❖ After receiving the bill and doing the payment it is affected in the Bank account

35. ❖ Anglo-Saxon based on Price Difference.
➢ Here, purchasing a product from a vendor but the product is received first before paying the amount.

36. ❖ Additionally, the actual price of the product is 505/- and here the price of the product is changed
in the bill received from the supplier as 510/-. Therefore, the difference in the price of the product
is added to the ‘Price Difference’ account as depicted.

37. ❖ In addition, this is reflected in the profit and loss report as it is the summary of income and
expense, in which the price difference is calculated as the difference of the actual cost of the
product and the cost of product while billing.

38.  When the same product to my customer and I have delivered the product before
receiving the payment. Now the Stock output account ie, ‘Goods Issued Not Invoiced’
and the Stock valuation account ie, ‘Inventory’ is being affected with the order as
depicted.
 Then given the bill against the order then the Accounts receivable is affected.
 In addition, while receiving the payment, it is affected in the Bank account.
❖ Customer Shipping

39.  When selling the same product to my customer and I have sent an invoice for the order.Then
the ‘Goods issued not invoiced’ ie, the stock output account and the ‘Accounts Receivable’
accounts are affected with an entry.
 If the customer paid the corresponding amount then the payment is affected in the ‘Bank’ account. As
the Anglo-Saxon will take the cost when a sales invoice is created, the income and expense accounts
are affected i.e., ‘Goods’ & ‘Cost of Goods Sold’,
Customer Invoice

40. For More
Details
Check our company website for related blogs and Odoo
book.
Odoo Book V15
Check our YouTube channel for functional and technical
videos in Odoo.
Odoo 15 Anglo Saxon and Continental Accounting

42. Thank You