How to use the Firmify accounting module

What does the Firmify accounting module do?

Firmify provides a complete accounting module that lets a small company owner manage their own books — no accounting background required. The module covers:

• Chart of accounts — pre-filled during setup
• Accounting periods — monthly or quarterly grouping of transactions
• Journal (general ledger) — all financial movements
• Sales and purchase invoices
• VAT periods and returns
• Financial reports — balance sheet, income statement, trial balance

The four core concepts

Before you start, understand these four concepts:

1. Account

An account is a category for recording financial operations. Examples: "Sales revenue" (703), "Cash" (501), "VAT payable" (4532). Firmify creates a standard chart of accounts automatically at setup.

2. Accounting period

A period covers transactions for a given month (or quarter). You must have an open period before you can post entries. At month end the period is closed — after that it cannot be edited.

3. Journal entry

Each financial event is recorded as an entry with a date, description, and at least two lines: one debit and one credit. Debit and credit must be equal. Firmify creates entries automatically when you save invoices — you will rarely need to add manual entries.

4. Invoice

An invoice is a document for a sale (issued to a client) or a purchase (received from a supplier). Each saved invoice automatically generates a journal entry and is included in the VAT period.

Step by step: Your first month

Step 1: Set up accounting

Go to /accounting/setup and choose your VAT registration type:

• Art. 97a — online services to international clients, no 20% Bulgarian VAT
• Standard (20%) — services and goods in Bulgaria
• Not VAT-registered — below the threshold or exempt

Click "Set up my books". Firmify creates the chart of accounts, accounting period, and VAT period automatically.

Step 2: Add a bank account

Go to Bank Accounts and add your company IBAN. This is needed for issuing invoices and bank imports.

Step 3: Add counterparties

Counterparties are your clients and suppliers. Go to Counterparties and add your main ones.

Step 4: Record invoices

• Sales → Accounting → Invoices → New Invoice
• Purchases → Accounting → Purchases → New Purchase

For each invoice enter: counterparty, date, number (for purchases — the supplier's number), items/services and VAT rate.

Step 5: Review the VAT period

Go to VAT and open the current period. Check that all invoices appear in the sales and purchase ledgers. Download the XML file for the NRA and file the VAT return by the 14th of the following month.

Step 6: Close the period

At month end go to Periods and close the accounting period. Verify that you have no DRAFT entries.

When do you still need an accountant?

Firmify suits self-management when you have:

• No employees
• Up to 50 transactions per month
• Uniform activity (e.g. consulting services only)

We recommend hiring an accountant for:

• Annual financial statements (GFO) — requires a licensed accountant's signature
• If you have employees (payroll, social insurance)
• Standard VAT registration (20%) with many transactions
• Tax audits