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Processing invoices in LoMag software

LoMag is based on 3 independent but integrated modules:

  • the Warehouse Module
  • the Orders Module
  • the Invoices Module

The warehouse and orders modules are described in separate instructions. This instruction is dedicated to the invoice module's functionality. This module may work in conjunction with the orders and warehouse modules.

Depending on the purchased module, the application's window (interface) may have a more or less advanced look. The invoice module window will look like this:

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With all three modules, the invoice app will have the following appearance - this instruction has been prepared based on such full option.

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NOTE: To enable invoice processing for the demo version, please select "Active modules": Invoices when you run the software for the first time. The setting is also accessible through the menu Programme / Settings wizard

1. Invoice Module

The LoMag Software features the following invoice issuing options:

  • Pro forma invoices
  • VAT invoices
  • Corrective invoices

1.1. Invoicing Settings

VAT

Businesses which are exempt from the VAT tax should change LoMag settings prior to issuing an invoice to exclude VAT calculations. Go to application's setting (LoMag), to LoMag section, and next in the LoMag section deselect this option: LoMag and confirm the change with the LoMag button. From now on invoices will be issued without the VAT tax deductions - see below

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VAT rates

LoMag features 6 default VAT rates, and these are:

  • 23%
  • 8%
  • 5%
  • 0%
  • VAT exemption (EX)
  • Non-taxable (NT)

To set up your own VAT rate use the LoMag module available in software's menu (LoMag).

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Invoicing methods

LoMag software features 2 algorithms for VAT invoice calculations: VAT calculated on net and on gross prices. Most business owners in B2B relations use net prices and in such cases the VAT calculations should include net prices. The VAT tax is rather seldom based on gross proces, e.g. when the tax payer is obliged to use specific government-set prices. LoMag lets you switch from net-based invoices (default) into gross ones. To do this, go to settings (LoMag), the LoMag tab, and then in the LoMag section choose the right invoicing algorithm (see below).

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1.2 Issuing invoices

There a few ways to generate an invoice; first - through the LoMag button located in the upper menu, where you next choose your document. Alternatively, you can open documents by using shortcut keys - F11 (Invoice), F10 (Pro forma Invoice).

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Order-related documents can also be opened with one of the icons of the app's toolbar - see below.

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New document window interface for different document types are very similar to each other and have numerous functions; below you'll find a brief outline of specific elements of the interface, and next a more detailed description of some of them follows.

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LoMag - a field where you adda a contractor to the document. The contractor can be selected from a drop-down list after clicking LoMag (for a faster search you may enter first letters of the contractor's name and click the button). Use the LoMag function to add a new contractor to your base. By using the LoMag button you can print out an address label (e.g. for a letter).

  • The contractor field may not be displayed if you turn off this function in the settings.

LoMag - the application automatically generates dates of sale, issuing, and payment for the invoice, as well as the number of the generated document (i.e. invoice).

  • You can change the issue date of a document and its number; please remember, however, to maintain the right document chronology. When entering past documents start from the oldest one and continue until the latest one.

LoMag - setting status and type of payment (e.g. a copy, an original). By default, there are two statues available (paid and due); to set a custom status click LoMag. To set a custom payment status click LoMag.

LoMag - the field LoMag allows you to determine the type of a print-out (e.g. a copy/original). The field LoMag determines the type of print-out (invoice by default). The field LoMag may be used for making on the invoice at hand.

LoMag - this part of the interface allows you to save a document in a pdf file (LoMag), print it out (LoMag), and edit document template (LoMag). Learn how to edit a warehouse document with the LoMag editor here. Additionally, you can send an invoice to the contractor's e-mail address by using the LoMag button.

LoMag - Button for generating a VAT invoice based on a proforma invoice. The function is available only via LoMag document.

LoMag - buttons for saving or cancelling invoice issuing action.

LoMag - buttons for adding new goods to the invoice,

LoMag - buttons for editing goods already added to the invoice.

LoMag - buttons for deleting goods from the document.

LoMag - a button for printing out a list of goods included on the invoice.

LoMag - a button for exporting a list of goods of from a specific invoice to an Excel file.

LoMag - a button for adding goods from a data collector. (See recommended devices for LoMag warehouse management software)

LoMag - a button for importing goods from an Excel file.

LoMag - a button for issuing an invoice on the basis of a previously created goods issue note (LoMag). This Module is not available for a proforma invoice.

LoMag - a button that displays relations between a document at hand and other documents.

1.3. Proforma invoice

The Proforma Invoice (LoMag) is a document used when selling goods and services, so it confirms the conclusion of a contract of sale, but it has no tax/bookkeeping effects provided for in the Goods and Services Tax Law. It is most often used to pay for transactions without bookkeeping or paying tax until the moment the order has been paid for.

Firstly, to issue a proper proforma invoice you should provide your client. To do this type first letters of his name in the LoMag field located in the LoMag window (provided the contractor has been previously entered into your LoMag data base) or add a new contractor with the LoMag button. A complete instruction on providing and adding contractors to LoMag is in the "contractor" instruction found here.

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Next, add goods to the proforma invoice by pressing the LoMag button (or by using the "Alt-D" keyboard shortcut).

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As an example, let's add to the invoice "Apples" as sample goods using the LoMag field and the LoMag button (or LoMag). To add the goods to the document it first has to be defined in the goods data file module (LoMag).

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Next, as you can see above, after determining your goods, you can see its available quantity and the price for which it was purchased. After providing the quantity of the "apples" goods you wish to sale and the price (per item), your gross price will be calculated, which will be your selling price - look below - e.g. You are selling 50 kg of apples for PLN 2.50 per 1 kg (and you paid for it PLN 1 per 1 kg). The gross price will rely on the selected VAT rate, which you can change LoMag field. To add goods to the proforma invoice click LoMag.

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All above values of "net price", "gross price", "VAT rate", and "mark-up" can be pre-defined in the LoMag module. After you add the goods to the proforma invoice it looks like this:

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If all the goods have been added to the invoice, remember to provide other details like date of transaction (sale, issuing, payment), its status, and type of payment and printout. Next you can print out (LoMag), save (LoMag) and send a proforma invoice to the client by e-mail - the way to do it is explained below.

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You have to remember that a proforma invoice has to include correct information about your company (the seller) - you have to provide them in LoMag settings (LoMag) in the LoMag tab.

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To send a proforma invoice to your contractor by e-mail, click the LoMag icon on the toolbar of the LoMag window.

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As presented above, first you have to configure e-mail in LoMag settings. To do this go to settings (LoMag), and next the LoMag tab. If the electronic mail settings have already been configured, the above information won't be displayed, and the process will open the LoMag module.

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In the LoMag tab provide the SMTP data of your e-mails service provider and the address and password of your e-mail account. You can get the SMTP details on your service provider's website. See illustrations with e-mail settings for most popular e-mail boxes in Poland.

E-mail settings for gmail.com

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After you provide the data click LoMag to go to your document and then click again the LoMag button. The LoMag window will open.

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Make sure the e-mail address of your contractor is correct and send the message by clicking LoMag. If the message is sent successfully, adequate information will follow.

After you issue a proforma invoice, save it and close the document window (LoMag). When some time later you register a payment for the proforma invoice, you'll be obliged to issue a VAT invoice. To avoid generating an invoice manually in the future, you can find the previous proforma invoice in the LoMag module, and next just by clicking (LoMag) you can generate an adequate VAT invoice.

For example, in the LoMag module and on the LoMag tab you will find your issued proforma invoice. To open the document, click on it twice with the right mouse button or use the LoMag button on the toolbar.

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After you open the proforma invoice, click on LoMag, which will automatically generate a VAT invoice.

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1.4 VAT Invoice

LoMag is a document which confirms a sale; unlike a proforma invoice, it leads to tax and bookkeeping obligations as described by the Goods and Services Tax Law. In LoMag software, VAT and the above-described proforma invoices are almost identical, but their legal effects are different. In the LoMag module there are two additional functions you won't find in the LoMag module - the LoMag tool and the LoMag tool (available if you use the warehouse module) described in further parts of the instruction.

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1.5 Corrective invoice

Corrective invoices amend data of a transaction and regard e.g. a discount, goods return or a mistake in price, VAT rate, or any other data is found. After you open the LoMag module you will first see a list of invoices from which choose the one you wish to correct and then click LoMag.

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After choosing the source document, the corrective invoice will include all the data, unchanged, of the original document, as can be seen below:

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Let's assume you want to amend the price of goods sold on the basis of document no. VI3/16 - M1. To perform the correction, select the goods and change the price by clicking LoMag.

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The net and gross fields present the current prices of the sold goods; to correct them go to the LoMag field and change the values (e.g. from PLN "1" to PLN "1.50"). Confirm the change with the LoMag button.

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The sale price on the invoice has been overwritten. Below you can see a printout preview for the invoice that has just been corrected.

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1.6 Dedicated columns on invoices

Dedicated columns allow you to add extra fields to invoices (e.g. "Client's order no.", which is a number used by your client to identify this transaction in his system). To add such extra field to a document go first to LoMag, and next the LoMag tab. Then select "Invoices" in the LoMag field.

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As an example, let's add a number column for transaction identification number used by the client in his system. To do so click LoMag to open a new window, where you enter in the LoMag field "Client's order no.", and then select the right column type (number column) and click the LoMag button to confirm the operation.

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After you've added a dedicated field, it will be located in the main window of order documents.

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Dedicated fields may also be included on document printouts.

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To have dedicated columns on your printouts (as seen above), edit the document template and place a dedicated column using the LoMag module. Editing and creating custom invoices in the LoMag module is explained in detail here.

You can create different types of dedicated columns. The above example regards number columns, but you can also add text columns, references (e.g. your client's website), yes/no surveys, dates and drop-down fields. Dedicated fields can be also placed in specific invoice sections (e.g. in the field for adding goods).

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2. Connecting modules: ORDERS - WAREHOUSE - INVOICES

As mentioned at the beginning of the instruction, each module of the LoMag software (Orders, Warehouse, and Invoices) are integrated. To illustrate this, there will be a series of operations presented from creating an offer all the way to issuing invoices. To be able to perform all the steps presented below, you will need to have all three LoMag modules.

Settings

LoMag lets you run your warehouse inventory both in net and gross prices. You can configure this in settings (LoMag), in the LoMag field located in the LoMag tab (see below). This setting works regardless of the VAT setting. With VAT processing on, the warehouse is run in net prices by default and without VAT in gross prices, but the program allows you to choose different configuration.

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Connections

Let's assume the following series of operations: (LoMag) you send a sales offer to your client, and he accepts it. Next (LoMag), on the basis of the offer, you have to generate an recipient order document. After a few days your client arrives to pick up the ordered goods - when he receives it, a document is generated for goods warehouse release.

LoMag - you want to make an offer for your client (Mr Smith). To do so, open a New offer document (LoMag), where you specify you want to sell 100 kg of apples for their purchasing price (i.e. with no LoMag imposed), and you send the offer to your client by e-mail.

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LoMag - after a few days the client expresses his interest, so you generate an order document, which is based on the offer document you've sent over to him. To do so, find the offer document in the LoMag module and open it.

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Generate an order document with the LoMag key.

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You can send the document to the client's e-mail address using the LoMag button. Save the operation with LoMag. You can change the price - just select the goods and click on LoMag

LoMag - the client came to pick up his ordered goods. When you hand over the goods, you also generate a GIN document (LoMag) (on the basis of a recipient order document). To do so, just like above, first find the previously generated order document in the LoMag module and click LoMag to create a GIN document.

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After the Goods Issue Note has been generated, you issue an invoice for the purchased goods LoMag. You can do it immediately in the Goods Issue Note (LoMag) by clicking LoMag.

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Alternatively to point LoMag, you can issue an invoice with a function "connect with Goods Issue Note (LoMag) in the document window LoMag going directly to the document (LoMag).

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Visualisation of connections

When issuing an invoice, it is worth having a look at the LoMag tool, where you should be able to see the entire operation detailed above. The LoMag module is a visual representation of document icons, which facilitates analysing document flow history. This allows you to quickly check which documents were created on the basis of other documents (e.g. a VAT Invoice generated from a Proforma Invoice). Such two documents may be drawn-up by different people and the prices may differ. So when you view an invoice window click LoMag.

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Let's have a closer look at connection visualisations.

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The box above shows the current document, i.e. VI3/16 - M1, and how it was created based on previous documents (LoMag). First, there was offer no. OF1/16 - M1 (LoMag), next an order document no. OC1/16 - M1 (LoMag), and Goods Issue Note no. GIN1/16 - M1 (LoMag). Also, you can see that the Goods Issue Note no. GIN1/16 - M1 was based on an opening balance. The GIN document was connected with the OB, because the warehouse stock changes only after the goods are released from the warehouse (the documents with the offer and order do not affect the actual stock). In the visualization you can see that the GIN was based on two client order documents and an OB used to receive goods into the warehouse. To view any of the documents just double click on it.

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The remaining part of the tree (below) depicts other warehouse operations linked to the OB document (and not with your current document). On right of the LoMag window there is a list of warehouse documents you can manage.

3. Fast invoice issuing with automatic stock update

If you are in the warehouse module, you may want to quickly issue an invoice and take goods off the warehouse stock. To do so you can first register a transaction by issuing a VAT invoice and only then will a Goods Release Note (GIN) be generated updating the stock. Let's issue a sample VAT invoice for sold goods and then click LoMag.

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A question will pop up asking whether you want to create a GIN document on the basis of the invoice. After you click LoMag a GIN document window will open (LoMag).

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4. Issuing summary invoices (Invoice wizard)

If you've purchased at least two LoMag modules - the warehouse and invoices ones - you can additionally issue invoices with an invoice wizard (LoMag). It allows you to issue invoice in three ways:

  • New blank invoice
  • Invoice generated based on warehouse releases
  • Invoice generated based on several warehouse releases

To start the LoMag module click the LoMag icon located on LoMag bar.

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New blank invoice

Next, in the interface of the LoMag window there are 3 options for generating invoices. If you choose the first one - LoMag, confirm it with the LoMag button and an interface for issuing invoices will open LoMag.

Invoice generated on the basis of a release from warehouse

If you choose the LoMag option, you can issue an invoice based on the already existing GIN document. The function is analogous to the described "connect to GIN" function (LoMag), which is available in the LoMag module. To use this way of issuing invoice, select the LoMag option and then click LoMag. This will open a window with documents on warehouse goods release. You can use these documents to generate an invoice.

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After you choose the right GIN document by a double-click, the document will be added to the wizard. To confirm your choice click LoMag. A window for issuing invoices will open, where you can generate the document.

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As can be seen above, the invoice now contains the goods from the GIN document of your choice.

  • Importantly, a given GIN document may be used only for one invoice. In other words, you can't create a few invoices with one GIN document.

Issuing invoice based on multiple warehouse releases

LoMag software also features the function of issuing summary invoices based on a few GIN documents. In such a case, the third option in the wizard will help, namely LoMag. After you choose it, the function for adding GIN documents to a specific contractor and/or adding other GIN documents becomes active. Go the first field LoMag, click on LoMag, and a list of contractors available in LoMag will appear. To add GIN documents of a given contractor to the wizard double click on the contractor and then click LoMag.

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As illustrated above, clicking LoMag adds all contractor-specific warehouse GIN documents to the field under the form (to delete any of these documents select it and hit LoMag.

Let's assume that once forgot to add your contractor (Smith) to one GIN document no. GIN7/16 - M1. Now you have to add him in the LoMag module with the option LoMag. As previously, click on LoMag, where you will see a list of documents, and then double click on your document (no. GIN7/16 - M1), and next click LoMag to add the document to the list.

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If you have chosen and processed all the documents on the basis of which you wish to issue an invoice, click the LoMag button in the wizard. The invoice now contains information about goods from the three above selected documents LoMag (see below).

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