Lebanon follows the International Financial Reporting Standards (IFRS) for accounting.
Differences in the Lebanese system necessitate modifications to standard accounting software.
These adjustments are vital to meet the specific requirements of Lebanon’s accounting rules.
Multi Currencies support
Currency Handling: Software stores journal vouchers in the main currency with extra data for multi-currency support.
Lebanese Requirement: Auditors in Lebanon need to view journal vouchers in Lebanese Pounds and foreign currencies.
Additional JV Data: Our system captures currency-specific debit/credit at transaction exchange rates.
Currency Reports: Financial reports are generated per currency, aligning with Lebanese accountants’ preference for transaction date rates.
Handling Discrepancies: At closing, any differences between financial reports in different currencies are posted as exchange discrepancies.
Multi Exchange Rate
Official rate: $1 = 1,500 LBP.
Bank rates: 4,500 and later 8,000 LBP.
Black market rate.
Application of Rates:
B2C dealings: Netting amounts in LBP based on the black-market rate, with taxes also applied at this rate.
B2B dealings: Billing in USD, collecting in USD, VAT initially priced at official rate, then 15,000 rate, and finally Sayrafa rate. VAT paid in LBP.
Accurate Financial Reports: Solely using the official rate made fiscal declarations challenging, hindering the accuracy of financial reports.
Payment Allocation Issues: Paying invoices in USD and VAT in LBP complicated the allocation of payments, making it difficult to mark invoices as closed.
Stock and Account Inaccuracies: Resulted in incorrect stock valuation and inaccuracies in bank and cash accounts.
Automatic closing vouchers
Closing Vouchers Usage:
Lebanese accountants use closing vouchers regularly, not just annually.
Quarterly VAT Declaration:
In Lebanon, VAT is declared quarterly.
Azkatech’s accounting module automates this by summing VAT received and paid, adding the difference to the appropriate account for payment to VAT authorities.
Azkatech’s module automates the process, selecting and consolidating the right amounts, generating a draft Journal Voucher. Optional consolidation with all relevant VAT transactions is ready for auditor approval.
Top 10 Customers, top 10 Suppliers
Ministry Requirement in Lebanon:
The Ministry of Finances mandates businesses in Lebanon to submit top customer and supplier lists to combat tax evasion.
Azkatech’s accounting module links every customer and supplier to transactions at the Journal Voucher level, facilitating accurate generation of top 10 customer and supplier lists to meet ministry requirements.
Per customer/supplier accounts & VAT
Traditional systems merge customer, supplier, and VAT accounts, posing issues for Lebanese accounting distinctions.
Lebanese Accounting with Azkatech Odoo:
Azkatech’s Odoo accounting allows the same partner to serve as a customer, supplier, or asset supplier with separate accounts and VAT accounts.
Users select the purchase type (e.g., asset or raw material) during transactions, ensuring accurate financial logging under the right accounts.
Postdated check – specific to Lebanese accounting
Azkatech’s system manages postdated checks in Lebanon for guaranteed payments.
It credits the partner account upon check receipt, debits a temporary account instead of the bank.
Generates a report of checks due, sent to the bank for collection.
Upon the bank’s confirmation, credits the temporary account and debits the bank account.