In government institutions, such as municipalities, provinces and safety regions, the VAT reclaim component works differently from the business and healthcare/education sectors. Government agencies can reclaim the VAT paid on purchased goods or services partly (prorated) from the tax authorities, but also partly from the VAT compensation fund (BCF).
You can specify which reclaim rates apply under the allocation code (cost centre). When entering a purchase invoice or purchase order, Profit then automatically enters the correct allocation of VAT reclaim, VAT in costs and VAT compensation fund. You claim the BCF in a separate return by means of a report/analysis.
Before you can use this, activate the VAT compensation fund (BCF) functionality and set it up further in Financial.
In government agencies, the calculation for depreciation of fixed assets works differently than in the business sector. Because the government has to comply with the BBV (Decree on Budgeting and Accountability of Provinces and Municipalities), interest expenses are entered in addition to depreciation. For this, two new fixed asset depreciation methods are available from Profit 3 onwards:
Before you can use this, activate the Fixed Assets Interest Calculation functionality and set it up further in Financial.
Government agencies can set an interest rate per year at the administration or asset group level. Depreciation and interest expenses are journalised separately.
The IV3 report is a financial analysis that government organisations use to justify to the central government how they are doing financially. These data are important in the distribution of the municipal fund, among other things. This IV3 reporting is now possible in Profit.
To use this functionality, you need to activate Reporting Information for Third Parties (IV3). As administrator, you can define what the link looks like with your general ledger accounts and cost centres. You can then extract a full IV3 analysis from Profit. This makes the process a lot simpler than handling the data outside Profit, and also less error-prone. Our aim is always to adapt things at the source. If something is entered incorrectly, you don't adjust it in your Excel, but in the records. At the press of a button, you then have a new IV3 analysis with the change incorporated.