How to configure Tax Rates, Accounts and Tracking Categories

How to configure Tax Rates, Accounts and Tracking Categories

Configuring Xero Tax Rates, Chart of Accounts and Track Categories is the first step to improved stable management via the Prism Finance module. 

Every single expense should have a Tax Rate and an Account assigned to it, whether it be in your Rules set up or when you are manually adding a single expense or group of expenses. Tracking Categories are optional, but they can enable improved Profit and Loss reporting in Xero.

Setting this up correctly the first time ensures all expenses captured in Prism are correctly allocated into Xero to enable you to run your standard accounting reports and ledgers, including balance sheets, profit and loss, accounts receivable etc. By setting up the Rates, Accounts and assignment of these to the relevant Expenses, enables your key reports to be built automatically in Xero, increasing efficiencies, reducing admin hours and errors. 


Configure Tax Rates

Although you can enter Tax Rates in either Prism or Xero, and then sync the two systems, we do recommend configuring Tax Rates in Xero.

Once you have set up Tax Rates in Xero, you can sync the list to Prism and keep the two systems in sync. 

Review how to setup Tax rates in Xero, here: https://help.xero.com/int/Tax-Add

SYNC TAX RATES FROM XERO TO PRISM

Once you have defined or added/updated/deleted tax rates in Xero, follow the steps in How to integrate Prism and Xero to sync them with Prism.

Once this synchronisation is complete, you can see Tax Rates in Prism. Navigate to Finance > Configure > Tax Rates.

Note: By default, there are some standard tax rates that are automatically synced via Xero that cannot be changed – these are represented by the padlock icon.

Add New Tax Rate In Prism

Although we recommend configuring Tax Rates in Xero first, you may choose to add new Tax Rates in Prism and sync them to Xero. 
  1. In Tax Rates screen, click + Add button on the top right
  2. Input Tax Rate Name -  identify the tax rate in the chart of accounts and on your transactions. It's only shown within Prism/Xero and not external items
  3. Input Type of Tax Rate from the drop down
  4. Input Components – this is the percentage rate applied to an item when you use the tax rate – eg., GST of 10%
  5. Then click Save
  6. The new Tax Rate will be shown in the list

Note: 
  1. You may need to add additional components to your Tax Rates. You can see the effective rate shown in the screen. Please confirm the number before applying to your system.
  2. With Xero sync, your tax rates will always be updated in both systems so regardless of where you add the new rate, it will update in both Prism and Xero. To do this, follow Synchronise to Xero instruction.

Delete a Tax Rate

All Tax Rates you created are able to be removed, however bear in mind that this action may affect your accounts – to be safe you may be better off creating a new tax rate. 

If you do wish to delete a Tax Rate, click on the Trash icon next to the item or you can choose multiple items and hit the Delete button located in the top right.  



Note: With Xero sync, your tax rates will always be updated in both systems so regardless of where you add the new rate, it will update in both Prism and Xero. To do this, follow Synchronise to Xero instruction.

Edit a Tax Rate

Some system tax rates can’t be edited, but some can. Click on Edit icon next to the Tax Rate, the dialog will be shown for you to update.

Note: 
  1. All tax rate you created, you are able to edit or delete it but be careful about your actions since it may affect to your accounts and/or transaction. For safety, if you do not want to use a rate anymore, keep it as is and create a new one instead.
  2. With Xero sync, your tax rates will always be updated in both systems so regardless of where you add the new rate, it will update in both Prism and Xero. To do this, follow Synchronise to Xero instruction.
  3. Currently we have the limitation when users edit tax rate in Xero, it will not be updated in Prism. So if you don’t want to use the rate any more, ignore it (keep it in Xero) and create the new tax rate to use. 
  4. If the error shows when synchronising, please contact support@prism.horse to solve the problem.

Configure Chart of Accounts

We recommend configuring Chart of Accounts in Xero, then can sync the list to Prism. 

Review how to configure Chart of Accounts in Xero, here: https://help.xero.com/int/Settings_ChartofAccounts

Once you have set up Chart of Account in Xero, you can sync the list to Prism. Go to Finance page and then Configure tab, click on Connect to Xero and follow the steps as defined in How to integrate Prism and Xero.

After you synced to Xero, the Xero Chart of Accounts will be in there and you will be able to add in your own if required.

With Xero synchronisation, there are some accounts already defined and used as standard by Xero. 

Some of these can be changed and some can’t. You can add, edit, delete all of your own accounts as well as any that are not locked by Xero. 

The list can also be re-ordered as required to help you view them how you wish. To re-order, click on the headers to sort as required. 



 Note that you are not required to use Xero to manage your accounts, however it is the only end to end solution offered by Prism at this point.

Add a New Account in Prism

Although we recommend configuring Accounts in Xero first, you may choose to add new Accounts in Prism and sync them to Xero. 
  1. In Chart of Accounts screen, click + Add button on the top right
  2. New Account dialog displays
  3. Input Code, Name, Description (internal overview), define Type and Tax Rate related then click Save .A message shows that you have created new account successfully
  4. New account will be shown in the list.


Note: With Xero sync, your chart of accounts will always be updated in both systems so regardless of where you add the new rate, it will update in both Prism and Xero. To do this, follow the sync steps in Synchronise to Xero.

Delete an Account in Prism

To remove an account, you can click on the Trash icon next to the line item. A confirmation will be shown. If you agree, the account will be deleted.


Note:
There are some accounts that you will not be able to delete due to some reasons below (You can move your cursor over the padlock icon at each line item to view more information):
  1. standard/locked system account of Xero
  2. accounts used by Fixed Assets
  3. accounts used by a tracked Inventory item
  4. accounts used by a repeating transaction
  5. accounts used to assign to bills/invoices
With Xero sync, your chart of accounts will always be updated in both systems so regardless of where you add the new rate, it will update in both Prism and Xero. To do this, follow the sync steps in How to integrate Prism and Xero.

We have a restriction when users delete an account in Xero then get it synchronised to Prism, error may show due to the technical limitation from Xero. If you’ve got this issue, please contact  support@prism.horse to solve it.

Edit an Account in Prism

You can edit accounts to make them suitable for your purpose. Click on Edit icon of each line item and it will show the Edit Account dialog so you can update as required.


Note: With Xero sync, your chart of accounts will always be updated in both systems so regardless of where you add the new rate, it will update in both Prism and Xero. To do this, follow the sync steps in How to integrate Prism and Xero.

Configure Tracking Categories

Tracking Category helps the businesses see how different areas are performing (such as departments, cost centres or locations).

As with Tax Rates and Accounts, we recommend configuring them in Xero. You can set up Tracking Categories then assign costs and sales to tracking categories to use various features provided by Xero such as Tracking Summary Report, Budget Reports (Budget Summary, Budget Variance, Profit and Loss), Balance Sheet, Statement of Cash Flows and others…

Review how to configure Tracking Categories, here: https://central.xero.com/s/article/Set-up-tracking-categories-GL

Tracking Categories are not required. If you do define some and use it in Prism, you can enjoy the advanced features in Xero. If not, it’s nothing impact to your Finance experience with Prism. 

Sync Tracking Categories From Xero To Prism

If you have defined tracking categories follow the steps in How to integrate Prism and Xero to get synced, after the process completed, the Xero Tracking Categories will be in there and you will be able to add in your own if required.
  1. Go to Finance - Configure, in Tracking Categories screen, click + Add button at the top right
  2. Add New Tracking Category dialog shows. 
  3. Input Tracking Category Name -  identify the tracking you want to use. It's only shown within Prism/Xero and not external items
  4. Input options of the tracking.
  5. Add New Tracking Category Option if you run out the number of options in the dialog.
  6. Then click Save
  7. The new Tracking Category and its options will be shown in the list.


Note: 
  1. You can edit the name of the tracking or the options right in the Add New Tracking Category screen. Or you delete an option if you want. All will be saved once Save button is hit.
  2. With Xero sync, your tracking categories will always be updated in both systems so regardless of where you add the new tracking or its options, it will update in both Prism and Xero. To do this, follow How to integrate Prism and Xero instruction.
  3. Due to the limitation of Xero, error may show to alert the problem. Follow the instruction in the message or contact support@prism.horse for help.

Enable Location Tracking

You may want to track the cost against each location. To do that Prism has an option to let you set up the tracking category due to your locations list quickly. 

In Tracking Categories screen, you can see “Enable Location Tracking” option, click on that button then you can see the locations list on the screen. Since then you are able to use that list as a tracking category.


To stop using tracking by location, you can simply click on “Disable Location Tracking” and confirm your action.


Deleting Tracking Categories

You can delete whole Tracking Category or just one or some options of a tracking. If you wish to do so, click on the Trash icon next to the item or you can choose multiple items and hit Delete button located in the top right.


If you are using the tracking for one or some costs/sales, when you delete it, the tracking and using options will be archived, other options that are not in-use will be deleted right away. 

If the tracking is not being used, you will be able to delete it completely. 

**More information on update Tracking Category can be found via Xero here: 

Note: If you delete (archive) a tracking category/ option, you won’t be able to use that value in the future and the value is removed from the expenses you have not synchronised to Xero. This action doesn’t remove the tracking categories you have used with the expenses that were synchronised to Xero already.

Edit Tracking Categories

You can edit tracking and/or options to make them suitable for your purpose. Click on Edit icon of each line item to make it editable inline so you can update as required. Please make sure you tick  before you go to save the change. 




Note:
  1. With Xero sync, your tracking categories will always be updated in both systems so regardless of where you add the new tracking or its options, it will update in both Prism and Xero. To do this, follow How to integrate Prism and Xero instruction
  2. Once you edit the tracking category/ options, it will update the value in all expenses using it no matter that the expenses have been synchronised to Xero or not

**More information on update Tracking Category can be found via Xero here: 

Restore An Archived Tracking Category/Option

Archived Tracking Categories and options are managed in Archived Tracking Category section. If you want to restore it to continue using, click on Restore icon next to each option. A confirmation dialog will so, follow the instruction in the screen to finish.      



Note: Xero has some limitations in number of active tracking categories so it may through errors if you exceed their standards. Please check https://central.xero.com/s/article/Rename-delete-or-restore-tracking-categories


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