Cash rounding is a process used in calculation when money in the low denomination is involved in a transaction. Sometimes, transactions become impractical when the denomination is very low. This could be either due to the unavailability of the coins to transact the exact amount. In such cases, every business firm depends on cash rounding.
For business firms handling several transactions, everyday cash rounding should be software-assisted. This will ensure accuracy and speed in the cash rounding process.
Odoo Accounting module has a Cash Rounding feature which is benefiting many business firms. In short, we can say that cash rounding is made possible when the base unit of an account is smaller than the most reduced denomination category of the currency. For example, in India the lowest denomination now is Rs 1. When the amount of 50 paise or 10 paise are involved in a transaction, it has to be rounded.
Cash rounding plays an important role in all types of business. This feature helps the vendor to round off the cost of any request when a cash installment is made. Odoo helps the user to round the total amount of a bill to the next available denomination of the currency. Taking the case of INR, the lowest existing currency is Rs 1. So a vendor using ODoo will be able to create a bill with a rounded total amount if any amount less than one rupee is involved in the transaction.
Odoo helps the user to quickly enable Cash Rounding. Go to Accounting module> Configuration> Settings> Taxes> Rounding Method
Round per Line: This method is used if the prices are tax-included. The round per line method helps a user to calculate the sum of line subtotals as equal to the total with taxes.
Round Globally:
Here, the user can select this directly. The user can also go to Accounting module -> Configuration -> Management -> Cash Rounding.
If you want to create a new cash rounding click the CREATE button.
In the create form a user will have to fill in the following details
Name: Name of rounding
Rounding Precision: Precision can be defined based on the precision of a numeric value. This indicates the number of digits that are used to express that value. While using this method, we consider the digits on the left and right of any decimal point. The rounding precision may also influence the rounding of the computed value.
Rounding Strategy: Odoo gives two strategies to manage cash rounding
1. Modify tax amount: This can be done by adding the rounding to the tax. Here, you have to select the highest tax amount.
2. Add a rounding line: Rounding can be added to a new line.
Account: Rounding will be recorded in the account
Rounding Method: Odoo offers three types of rounding methods. They are,
1. UP: When we choose UP, the value rounds towards plus infinity based on the rounding precision.
2. DOWN: On selecting DOWN, the automatically rounds towards minus infinity based on the rounding precision on choosing down.
3. HALF-UP: This method is used in the case of fractional values. If the fraction part of a value is greater than or equal to 0.5, the rounding will be done towards plus infinity. On the other hand, if the fraction part is less than 0.5 then round half towards minus infinity in this case.
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