INTERNAL and EXTERNAL ACCOUNT Controls

These 2 accounts are set up in Nominal Links – see INTER DEPARTMENT Transfers and Vehicle Stocks Parameters for EXTERNAL WORK Carried Out.
 
These accounts are Control accounts and in a perfect world they will have matching debits and credits. The outstanding items are therefore unmatched which means the posting process has not been completed – it is a Work in Progress account through which you can identify and chase up invoices from suppliers or postings required to vehicles to complete the costing analysis.
 
So - when you post an invoice to a suppliers account it credits Creditors Control. This account maps the debits and credits and keeps a running total - so it 'controls' that accounting function.
 
Some purchases are similar and can be made by different departments. So a CD player could be bought by Parts to go into stock - you debit Stock and credit Creditors Control (via purchase ledger). The same CD could be purchased by Service as fitted to a customers car - a sub-contract purchase sold out as a sub contract sale. In this case you debit Sub Contract Purchases and credit Creditors Control. And then there is the Car Sales dept. Most accounting problems occur because of salesmen ! So when they buy a CD player from the same supplier as the above and fit it themselves, it needs to be posted to the vehicle to keep the profitability correct. 
 
All the nominal codes are set up for car sales in the Vehicle Groups menu. So when you post to a vehicle you are debiting the cost centre in this case Dealer Fitted Accessories.  But you are not in Purchase Ledger so you cannot credit Creditors Control.  Instead you elect during posting to say if this is an Internal or External purchase.  In so doing you credit the Internal or External Control Account.  The posting is complete and the invoice now goes to the Accounts Dept for posting to the appropriate suppliers account.
 
But hang on a minute - what nominal code do you use ?  It is a Dealer Fitted Accessory so if you post it to Dealer Fitted Accessories you are posting it a second time. You have to use a nominal code as this is how the accounts system works - so you post to the External Control Account. This time you debit External Control.  If this was the only posting to the account you would have a debit from Car Sales and a credit from Accounts thus matching the posting.  This posting is now complete and therefore "Controlled".
 
By regularly looking at the External Control account and matching the postings through Account Reconciliation you can make sure that all purchases through the Sales Dept and properly controlled.  A debit and no credit means the invoice has been lost or posted to the wrong nominal account.  A credit and no debit means Sales have not posted the cost to the vehicle. You keep them in check and your DP has accurate accounts.   It is much the same with Internals.  Service or Parts post to the INTER sales ledger account. As soon as the invoice hits the account an automatic posting takes place to credit the Debtors Control account and debit the Internal Control Account. When you go through the Accept Workshop Costs routine you agree the invoices from Service and post then to the vehicle. In so doing you are debiting the cost centres as set up in Vehicle Groups and crediting the Internal Control account. This posting is now complete and therefore "Controlled". 
 
By regularly looking at the Internal Control account and matching the postings through Account Reconciliation you can make sure that all purchases through the Sales Dept and properly controlled.  A debit and no credit means the invoice has not gone through the Accept Workshop Costs routine and therefore is probably stuck in the CASHR Sales Ledger account.  A credit and no debit means Sales have not posted the cost to the vehicle.     It will all become clear as you start to do it