# Accounting

How NFE keeps its books in ERPNext: the migration record, chart of accounts and cost centres, and the monthly and year-end close. Adapted from GitLab's Accounting and Reporting pages.

# Open Collective → ERPNext migration: decisions and status

# Open Collective → ERPNext migration: decisions and status

**Owner:** Aaron Tushabe · **Last reviewed:** 29 Oct 2026 · Part of the [Finance book](/link/212) · **Company in ERPNext:** Watt Works Foundation Limited (base currency UGX, financial year 1 Jul – 30 Jun)

This page records how NFE's accounting history moved from Open Collective ([opencollective.com/nfe](https://opencollective.com/nfe)) into ERPNext, and every accounting decision made along the way. Check here before changing any of the migrated entries.

## Where things stand

| Item | Status |
|---|---|
| Migrated history | **140 journal entries** submitted, ACC-JV-2026-00001 to 00140 |
| Watt Works UGX bank account (1220) | **1,531,613 UGX** at 12 Oct 2026, matching the bank statement exactly |
| Open Collective Funds clearing account (1210) | **0 USD / 0 UGX**, cleared at cut-over on 13 Jul 2026 |
| Owner's Capital – Aaron Tushabe (3110) | 44,141,363.38 UGX |
| Owner's Capital – Hillary Arinda (3120) | 3,588,210 UGX |
| Equipment capitalised as fixed assets | 14 reclassification entries (ACC-JV-2026-00141 to 00154) and 4 asset records (29 Oct 2026) |

**Still open:**
- [ ] **VAT:** the accountant is reviewing how VAT payments are treated against output VAT. VAT payments are currently debited to the VAT account.
- [ ] **Depreciation for FY 2025–26 (30 Jun 2026):** ERPNext's daily scheduled job should post this. It hadn't posted by 29 Oct 2026. Check Journal Entry → type "Depreciation Entry". If nothing appears, the scheduler may be switched off on the server.
- [ ] **Bank reconciliation:** clearance dates haven't been set in ERPNext yet.
- [ ] **Generator deposit:** chase the supplier for the refund (see decision 4).

### Finding a migrated entry

Every migrated journal entry's **User Remark** starts with its source:

| Key | Meaning |
|---|---|
| `[OC-<id>]` | An Open Collective transaction (its Open Collective ID) |
| `[BANK-<line>]` | A UGX bank-statement line with no Open Collective entry |
| `[OWNER-n]` | Paid personally by Aaron, in neither Open Collective nor the bank |
| `[CUTOVER-n]` | The two 13 Jul 2026 entries that cleared the Open Collective account |
| `[RECLASS-<entry>]` | Moves an original expense entry into fixed assets, a deposit or work in progress |

ACC-JV-2026-00001 to 00006 were the approved test batch. Their remarks say "TEST" instead of a key.

### Source files

These stay with the finance files in Aaron's Accounting folder (Nearly Free Energy drive, `Accounting/migration/`):
- **OC to ERPNext mapping.xlsx:** every transaction with its account, cost centre, BoU rate and UGX amount, plus the bank reconciliation check and the cut-over sheet.
- **bou_usd_ugx_rates.csv:** the 54 daily Bank of Uganda rates used.
- The Open Collective all-time CSV export and the UGX bank statement CSV (19 Apr – 12 Oct 2026).

## Decisions

### 1. Real money accounts and the Open Collective clearing account

- **Watt Works UGX bank account (1220):** the company's local account. All company cash now sits here.
- **Wise USD account (1230):** stays in use from now on, starting at zero. Before the migration it also carried other business, so its history wasn't used.
- **Open Collective Funds (USD) (1210):** a temporary clearing account. All Open Collective history before 19 Apr 2026 was posted against it. It stood for company money wherever it actually sat.
- **19 Apr 2026, when the bank statement starts:** the bank's opening balance of 3,661,171 UGX moved from the clearing account into the bank account. After that date, anything on the bank statement was posted to the bank at the bank's actual UGX amount, with Open Collective supplying the description and category.
- **Cut-over, 13 Jul 2026.** The Open Collective balance turned out to be in the UGX bank, so the USD 211.75 left in the clearing account didn't correspond to cash anywhere. Two entries cleared it:
  - USD 211.75 (780,043 UGX at BoU 3,683.79) to **5228 Research and Prototyping**, NFE Operations. This is probably testing hardware such as Raspberry Pis that was never recorded in Open Collective.
  - 787,587 UGX to **5219 Exchange Gain/Loss**. This difference built up because USD flows were converted at different daily rates.
- **Expenses Aaron paid personally that Open Collective already counted** as part of his contributions went through the clearing account like everything else. Posting them again against equity would count them twice.

### 2. Transactions found only on the bank statement

These May–June 2026 payments aren't in Open Collective:

| Date | UGX | What | Party | Cost centre |
|---|---|---|---|---|
| 21 May | 5,001 | Refund of a test "customer" payment (the test inflow is in the 19 Apr opening balance) | Aaron Tushabe | Main (posted to owner's capital) |
| 5 Jun | 88,500 | UEDCL inspection, new three-phase grid connection | UEDCL | Kyanja Town Homes |
| 6 Jun | 1,000,000 | Battery/inverter shelter civil works (part payment) | MOTECH Constructions Solutions Limited | Sezibwa Homes |
| 7 Jun | 80,000 | Electrician's wiring certificate | Hats Engineering Works Limited | Kyanja Town Homes |
| 9 Jun | 118,000 | UEDCL inspection, new three-phase grid connection | UEDCL | Pearl Marina |
| 11 Jun | 500,000 | Battery/inverter shelter civil works (final payment) | MOTECH Constructions Solutions Limited | Sezibwa Homes |

Other rules for bank-only lines:
- **Transfer charges and fees:** each payment's mobile-money transfer charge and excise duty go to 5221 Bank Charges, under the same cost centre as the payment. The monthly 25,000 UGX management fee and its excise go to NFE Operations.
- **"Contributions from NFE Business"** (Oct 2025 – Jan 2026 in Open Collective) and the bank's monthly inward RTGS deposits are **electricity sales from the Sezibwa Rentals pilot**, NFE's only sales so far. They post to 4110 Sales, Sezibwa.
- **Daphine Nabwami's stipend:** Daphine was the onsite microgrid manager, paid 50,000 UGX/month from Sep 2025 to about Jun 2026, when the onsite work was largely automated. The Sep and Oct 2025 stipends were paid from Aaron's personal account and aren't in Open Collective. They're posted as expense against Aaron's owner's capital.

### 3. Owner contributions are owner's equity

These go to owner's equity, never to income and never to be repaid:
- **Aaron Tushabe (3110):** the $10,000 contribution (Dec 2024), the $1,782.86 contribution (Oct 2025), the $35 monthly Stripe contributions, and expenses Aaron paid personally that aren't in Open Collective. The 5,001 UGX test refund reduces it.
- **Hillary Arinda (3120):** a $1,000 contribution (Jul 2025), in a separate account.

Contributions from anyone else, such as Energy IoT Open Source ($2,800, Apr 2026), are **grant/donation income** (4230 Grants and Donations).

### 4. Equipment is capitalised and depreciated on URA rates

**Decided 29 Oct 2026.** This replaced an earlier decision to expense all pilot-site equipment.

**What's capitalised.** Everything first posted to 5130 Microgrid Equipment and Installation, about 28.7M UGX, has moved out of expenses. That includes installation labour, inspection fees and certificates, because they were needed to get the equipment working. The original entries are unchanged, and a dated `[RECLASS-…]` entry moves each one:

| Asset (ERPNext) | Cost (UGX) | In use from | Category |
|---|---|---|---|
| ACC-ASS-2026-00001-1 Sezibwa Phase 1 | 9,883,771.96 | 30 Sep 2025 | Microgrid Equipment (URA Class 3) |
| ACC-ASS-2026-00005 Phase 1 Calin meter installation labour (scrapped 31 Mar 2026) | 2,001,841.38 | 30 Sep 2025 | Microgrid Equipment (URA Class 3) |
| ACC-ASS-2026-00002-1 Sezibwa Phase 2: inverter and batteries | 9,209,385.83 | 31 Jul 2026 | Microgrid Equipment (URA Class 3) |
| ACC-ASS-2026-00003-1 Sezibwa battery/inverter shelter (MOTECH) | 1,500,000 | 31 Jul 2026 | Buildings and Shelters (5% straight-line) |
| ACC-ASS-2026-00004-1 Sezibwa tenant meters (2) DDSU666, Green Volta INV-000057 | 348,926.03 | 21 Jan 2026 | Microgrid Equipment (URA Class 3) |

**Changes on 30 Oct 2026.** Records 00001–00004 were cancelled and re-issued with `-1` names. Phase 2 and the shelter moved from 30 Jun to 31 Jul 2026, when Phase 2 went live. The INV-000057 meters turned out to be tenant meters, so they stay assets and moved to Sezibwa from 31 Mar 2026. The Calin meter installation labour came out of Phase 1: see [Write-off of the Calin meter installation labour (31 Mar 2026)](/link/221).

**Not assets:**
- **Kyanja (168,500) and Pearl Marina (118,000):** those sites aren't live yet, so these costs sit in **1790 Capital Work in Progress**. When a site goes live, move its balance into a new asset record.
- **Perkins 60kVA generator + 10 Wi-Fi smart meters (5,467,711 UGX, Jun 2025):** a partial deposit of about 10%. Nothing was delivered, because NFE dropped diesel to focus on solar, and the supplier hasn't refunded it. It's tracked as **money owed to NFE** in **1652 Supplier Deposits Recoverable**. Write it off to expense only if recovery is abandoned.
- **Metering samples and testing hardware** (Raspberry Pis, etc.) stay as expenses (5228 Research and Prototyping).

The rules (what's capitalised, URA-based rates, recording new site equipment) are in the [Fixed assets and depreciation policy](/link/213).

### 5. Exchange rates

- **Before 19 Apr 2026:** USD transactions were converted at the **daily Bank of Uganda official mid rate** for the transaction date. On weekends and holidays, the last rate published before that date was used. The rates came from the BoU Data Portal (bou.or.ug → Data → BoU Data Portal → Exchange Rates → Daily).
- **From 19 Apr 2026:** entries that went through the bank use the bank's actual UGX amounts.

## ERPNext setup created for the migration

Accounts, cost centres, remark keys and their change log are in [Chart of accounts and cost centres](/link/215). VAT questions are tracked in [VAT treatment decisions](/link/219).

# Chart of accounts and cost centres

# Chart of accounts and cost centres

**Owner:** Aaron Tushabe · **Last reviewed:** 29 Oct 2026

*Adapted from GitLab's [Accounting and Reporting](https://handbook.gitlab.com/handbook/finance/accounting/) pages (CC BY-SA 4.0).*

NFE's books are in **ERPNext** (company: Watt Works Foundation Limited, currency UGX). This page explains how the accounts and cost centres are organised. For balances, open ERPNext; this page never copies them.

## Change control

Only Aaron Tushabe (owner) and Hillary Arinda (approver) add or change accounts and cost centres. To request one, comment on this page. Record every change in the change log at the bottom.

## Key accounts

| Account | Use it for |
|---|---|
| 1220 Watt Works UGX Bank Account | The company's UGX bank account. All company cash. |
| 1230 Wise USD Account | USD held in Wise. Company money only. |
| 1210 Open Collective Funds (USD) | Closed. Clearing account for the Open Collective history; zero since 13 Jul 2026. |
| 1652 Supplier Deposits Recoverable | Deposits paid for goods not yet delivered, or that should be refunded |
| 1711 Microgrid Plant and Equipment | Capitalised microgrid equipment ([fixed assets policy](/link/213)) |
| 1760 Buildings | Equipment shelters and civil works |
| 1780 Accumulated Depreciation | Built up by ERPNext's depreciation entries |
| 1790 CWIP Account | Capital work in progress: sites not yet live |
| 2160 Customer Advances | Customer deposits received before work is done |
| VAT | VAT payable and paid |
| 3110 Owner's Capital – Aaron Tushabe | Aaron's contributions, and expenses he paid personally |
| 3120 Owner's Capital – Hillary Arinda | Hillary's contributions |
| 4110 Sales | Electricity sales |
| 4230 Grants and Donations | Grants and donations (not owner money) |
| 5120 Electricity Purchases (UEDCL) | Grid electricity bought from UEDCL |
| 5130 Microgrid Equipment and Installation | Small equipment below the capitalisation threshold |
| 5203 Depreciation | Posted by ERPNext |
| 5219 Exchange Gain/Loss | Currency differences |
| 5221 Bank Charges | Bank, mobile-money and transfer fees, plus excise duty on them |
| 5226 Stipends and Allowances | Stipends, such as the microgrid manager and internet stipends |
| 5227 Software and Subscriptions | Software, domains, hosting |
| 5228 Research and Prototyping | Testing hardware, samples, prototypes |

## Cost centres

**Rule:** charge spending to the site or team that owns the outcome.

| Cost centre | Use it for |
|---|---|
| Sezibwa Homes - NFE Pilot | Everything for the Sezibwa microgrid, including its sales, UEDCL bills, fees and equipment |
| Kyanja Town Homes | The Kyanja site (under construction) |
| Pearl Marina | The Pearl Marina site (under construction) |
| NFE Operations | Company-wide operations: registration, software, travel, team costs, monthly bank fees |
| Main | General: owner contributions and anything not tied to a site |

Examples:
- A transfer fee on a payment for a Kyanja inspection goes to **Kyanja Town Homes**, the same as the payment.
- A technician's trip that covers two sites is split between their cost centres in one journal entry.

## Remark keys

Journal entries created by a migration or bulk process start their **User Remark** with a key, so they can be searched:

| Key | Meaning |
|---|---|
| `[OC-<id>]` | Migrated from Open Collective |
| `[BANK-<line>]` | Migrated from a bank-statement line |
| `[OWNER-n]` | Paid personally by an owner, outside the bank |
| `[CUTOVER-n]` | Open Collective cut-over entries |
| `[RECLASS-<entry>]` | Moves an earlier entry to a different account |

## Change log

| Date | Change | Why | Who |
|---|---|---|---|
| 29 Oct 2026 | Added 1652, 1711, the two asset categories, and the Microgrid System and Equipment Shelter items | Capitalising the Sezibwa build-out | Aaron Tushabe |
| 17 Oct 2026 | Created bank accounts 1210/1220/1230, owner's capital 3110/3120, 4230, and 5120–5228; cost centres for each site; FY2024-25 and FY2025-26 | Open Collective migration | Aaron Tushabe |

# Month-end close checklist

# Month-end close checklist

> **Planned: not yet written.** Owner: Aaron Tushabe. Trigger: written from the first close of the October 2026 books in ERPNext (early November), alongside the 15 Nov VAT filing.

*Will be adapted from GitLab's [Accounting and Reporting](https://handbook.gitlab.com/handbook/finance/accounting/) pages (CC BY-SA 4.0).*

What this page will cover:
- A calendar in working days: invoices and expenses entered, bank and mobile money reconciled, VAT working sent to the accountant, VAT filed by the 15th.
- A reconciliation table: account, who prepares it, and who reviews it (never the same person).
- Closing the period in ERPNext once everything is reconciled.
- A short monthly owners' review: cash, collection rate per site, URA filings on time, and spending against budget per site.
- "Update any Finance page this month changed."

# Year-end close and audit readiness (FY2025-26)

# Year-end close and audit readiness (FY2025-26)

> **Planned: not yet written.** Owner: Aaron Tushabe. Trigger: engaging the accountant for the FY2025-26 annual return (due about 31 Dec 2026; confirm the date).

What this page will cover:
- Deadlines, confirmed with the accountant.
- Checking the FY2025-26 depreciation posted on 30 Jun 2026 (still open on the [migration record](/link/208)).
- The Period Closing Voucher in ERPNext.
- Results by site (cost centre), feeding [Surplus Sharing](/link/38).
- What lenders and memberships will ask for (AMDA, bank asset financing), and choosing an auditor.

# Write-off of the Calin meter installation labour (31 Mar 2026)

# Write-off of the Calin meter installation labour (31 Mar 2026)

**Decided and booked 30 Oct 2026.** UGX 2,001,841.38 of Green Volta labour for installing the Calin meters came off Sezibwa Phase 1 as at 31 Mar 2026, when those meters were replaced. FY2025-26 expense rose by 1,701,290.95, and FY2026-27 depreciation falls by 340,258.19. This follows on from decision 4 on [the migration decisions page](/link/208).

## Why

- The labour was for installing the Calin smart meters at Sezibwa in September 2025. Dansturn paid it, and Open Collective repaid him on 7 Oct 2025: USD 582.00 at 3,439.59 ([ACC-JV-2026-00026](https://erpnext.nearlyfreeenergy.com/desk/journal-entry/ACC-JV-2026-00026)). It was capitalised into Phase 1 on 29 Oct 2026 ([ACC-JV-2026-00147](https://erpnext.nearlyfreeenergy.com/desk/journal-entry/ACC-JV-2026-00147)).
- At the end of March 2026 the 10 Calin meters were replaced with CHINT DDSU666 meters: the 9 on Green Volta INV-000117 plus one of the INV-000057 pair. The Calin meters are being donated to EnAccess (29 Aug 2026 check-in).
- Under IFRS for SMEs, when part of an asset is replaced, the replaced part's carrying amount comes off and the loss goes to profit or loss (s.17.6, s.17.27–17.30). The [Fixed assets policy](/link/213) has no partial-disposal rule, so this follows the standard.
- Only the labour is affected. The Calin meters themselves were expensed as metering samples on 23 Jun 2025 ([ACC-JV-2026-00012](https://erpnext.nearlyfreeenergy.com/desk/journal-entry/ACC-JV-2026-00012), 4,761,522.42 to 5228).

## The numbers

UGX, Sezibwa cost centre.

| | Before | After | Change |
|---|---:|---:|---:|
| Phase 1 cost in 1711 | 11,885,613.34 | 9,883,771.96 | −2,001,841.38 |
| FY26 depreciation, Phase 1 (30 Sep 2025–30 Jun 2026) | 1,784,470.17 | 1,483,919.74 | −300,550.43 |
| FY26 depreciation, Calin labour (30 Sep 2025–31 Mar 2026) | – | 200,732.59 | +200,732.59 |
| Loss on disposal, 31 Mar 2026 (5222) | – | 1,801,108.79 | +1,801,108.79 |
| **Total FY26 expense** | **1,784,470.17** | **3,485,761.12** | **+1,701,290.95** |
| FY27 depreciation, 30 Jun 2027 | 2,020,228.63 | 1,679,970.44 | −340,258.19 |

Depreciation is 20% a year on the reducing balance (Microgrid Equipment, URA Class 3), with days counted inclusively, the same way ERPNext's schedule works. No cash moved.

## What was booked in ERPNext

| Step | Record | UGX |
|---|---|---:|
| Phase 1's original FY26 depreciation cancelled | [ACC-JV-2026-00156](https://erpnext.nearlyfreeenergy.com/desk/journal-entry/ACC-JV-2026-00156) | 1,784,470.17 |
| Phase 1 re-issued without the labour | [ACC-ASS-2026-00001-1](https://erpnext.nearlyfreeenergy.com/desk/asset/ACC-ASS-2026-00001-1) | 9,883,771.96 |
| Calin labour as its own record, scrapped 31 Mar 2026 | [ACC-ASS-2026-00005](https://erpnext.nearlyfreeenergy.com/desk/asset/ACC-ASS-2026-00005) | 2,001,841.38 |
| Depreciation to 31 Mar 2026 (5203) | [ACC-JV-2026-00157](https://erpnext.nearlyfreeenergy.com/desk/journal-entry/ACC-JV-2026-00157) | 200,732.59 |
| Loss on disposal (5222) | [ACC-JV-2026-00158](https://erpnext.nearlyfreeenergy.com/desk/journal-entry/ACC-JV-2026-00158) | 1,801,108.79 |
| Phase 1 depreciation, 30 Jun 2026 | posts on the nightly run of 31 Oct | 1,483,919.74 |

## Accountant's answers (30 Oct 2026)

- Derecognise under s.17.6, dated 31 Mar 2026: agreed.
- Method: a separate asset record, then scrapped.
- Tax: add the 1,801,108.79 loss back in the FY2025-26 tax computation. A comment on [ACC-JV-2026-00158](https://erpnext.nearlyfreeenergy.com/desk/journal-entry/ACC-JV-2026-00158) says so.
- Auditor note: the Calin meters were expensed as samples in FY2024-25, but they were Sezibwa's production meters from September 2025 to March 2026. This is noted in a comment on [ACC-JV-2026-00012](https://erpnext.nearlyfreeenergy.com/desk/journal-entry/ACC-JV-2026-00012).

## Approval

Reviewed by Aaron Tushabe. Approved by Hillary Arinda, as relayed by Aaron on 30 Oct 2026. **Hillary:** please confirm with a comment on this page so your sign-off is on record.