Venkat Thandra and Ahmed Shaaban
[2022] APO 13
•23 February 2022
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Venkat Thandra and Ahmed Shaaban [2022] APO 13
Patent Application: 2015298319
Title:The modified cash ledger basis for an accounting system and process
Patent Applicant: Venkat Thandra and Ahmed Shaaban
Delegate:Dr S. J. Smith
Decision Date: 23 February 2022
Hearing Date: Written submissions filed on 26 April 2021 and 28 January 2022
Catchwords: PATENTS – examiner’s objection – whether invention is a manner of manufacture – accounting system – scheme – business innovation – alleged invention not a manner of manufacture – application refused
Representation: Patent attorney for the applicant: Murray Trento & Associates Pty Ltd
IP AUSTRALIA
AUSTRALIAN PATENT OFFICE
Patent Application: 2015298319
Title:The modified cash ledger basis for an accounting system and process
Patent Applicant: Venkat Thandra and Ahmed Shaaban
Date of Decision: 23 February 2022
DECISION
The claimed invention is not for a manner of manufacture.
I refuse the application.
REASONS FOR DECISION
Background
Patent application 2015298319 (the application) in the name of Venkat Thandra and Ahmed Shaaban (together, the applicant) was filed on 15 July 2015 under the provisions of the Patent Cooperation Treaty. The application claims priority from US 61/999,408 filed on 26 July 2014 and US 14/544,385 filed on 31 December 2014.
Examination was requested on 9 May 2019. A first examination report was issued on 21 February 2020 raising objections of lack of manner of manufacture, clarity, novelty and inventive step. A response to the examination report was filed on 16 December 2020, and a second examination report, maintaining only the objection of lack of manner of manufacture, was issued on 11 January 2021. On 11 February 2021 the applicant asked to be heard in relation to the outstanding objection. The matter was heard by written submissions filed on 26 April 2021.
On 3 December 2021 I wrote to the applicant inviting submissions in view of the decision of the Full Court of the Federal Court in Commissioner of Patents v Aristocrat Technologies Australia Pty Ltd.[1] The Applicant filed these submissions on 28 January 2022.
[1] [2021] FCAFC 202 (‘Aristocrat ’21’).
Because the application was filed after 15 April 2013 it is governed by the Patents Act 1990 (the Act) as amended by the Intellectual Property Laws Amendment (Raising the Bar) Act 2012. Accordingly, the standard of proof that applies to the examination of the present application is the balance of probabilities – if satisfied on the balance of probabilities that the application complies with the Act I must accept the application.[2] If I am not so satisfied, then I can refuse the application.[3]
[2] Section 49 of the Act as amended.
[3] The Explanatory Memorandum, Intellectual Property Laws Amendment (Raising the Bar) Bill 2011 at page 54.
Pursuant to regulation 13.4(1)(g) when the Commissioner gives an applicant an opportunity to be heard in relation to an examiner’s objection and issues a written decision, the period for gaining acceptance of the application may be extended until three months from the date the decision is issued, or, pursuant to regulation 13.4(3), for a period of longer than three months if the Commissioner is satisfied that acceptance should be postponed.
The applicant has requested that, regardless of my finding as to the validity of the claims, the application be returned to examination with at least a six month period for gaining acceptance in view of “greater insight” recently afforded to the applicant from exchanges between IP Australia and the applicant’s attorney and to avoid “any possible procedural unfairness”. I will say at the outset that I do not agree that this is either necessary or appropriate. The reasoning underpinning the objections to the claims of this application has been communicated in examination reports. The applicant has been given an opportunity to be heard in relation to the examiner’s objection, and to present its view as to the relevant principles derivable from the case law and their application to the presently claimed invention. There has been no denial of procedural fairness.
The specification
Amendments to the specification were proposed on 16 December 2020. References to the specification in this decision relate to the specification as proposed to be amended.
The specification sets out the field of the invention as follows:
“The exemplary and non-limiting embodiments of the present invention relate generally to the field of a business method and process concerning the basis of accounting for any professional firm, including, in particular, a method for providing a combination of accrual and cash accounting, a system that has the ability to maintain multiple Modified Cash Ledgers plus the ability to post transactions to the Management Cash Ledger based on preselected criteria.”[4]
[4] Specification, page 1, lines 1-7.
Several patented computerised systems for managing transactional data relating to income and expenditure for a business are discussed as background to the present invention. The specification then states:
“In the prior art, there are systems in the field of a business method and process related to the basis of accounting for any professional firm; however, the prior art does not provide for a system or method as the present invention. In particular, the prior art clearly lacks a method for providing a combination of accrual and cash accounting, a system that has the ability to maintain multiple parallel ledgers including modified cash ledgers, statutory accrual ledgers, and statutory cash ledgers, with the ability to post transactions from the Leading Ledger to the Modified Cash Ledger based on preselected criteria while posting in real time to the Statutory Accrual and Statutory Cash Ledgers. This has never been done before on any system, including an ERP system or various other similar systems until development of the present inventive system.”[5]
[5] Specification, page 3, line 17 - page 4, line 5.
A number of objectives of the invention are articulated, including to:
· “provide an improved and modified accounting system and method capable of recording transactions on both cash and accrual basis, which is able to enhance the firm’s ability to manage and provide data in a harmonized, consolidated fashion in all cities and countries in which the firm conducts business by providing income and expense data displayable in a plurality of currencies which are updated at set intervals”;[6]
· “increase efficiency and profitability of a company or other business entity by reducing the local and global costs associated with maintaining disparate systems and processes among differing companies and firms by providing a consolidated system utilizing standardized ledgers between locations”;[7]
· “reduce quarterly and year-end financial support schedules as well as generate reports required for tax reporting and payment purposes”;[8]
· “eliminate the need to reconcile local books to global books”;[9]
· “enable global transactions that used to be posted by global staff to now be posted by local personnel, and said transactions also may be accessed by personnel from local or global locations”;[10]
· “reduce financial process operating costs through standardization and eventually centralization of some core processes, such as the general ledger, and to reduce current and future technology costs by providing minimal reports with optimal information on each report.”[11]
[6] Specification, page 7, lines 4-9.
[7] Specification, page 7, lines 11-15.
[8] Specification, page 8, lines 1-3.
[9] Specification, page 8, lines 6-7.
[10] Specification, page 8, lines 12-14.
[11] Specification, page 9, lines 11-14.
It is explained that the inventive system, “The Improved Ledger Accounting System” is typically run in association with various hardware elements and can be used by a wide variety of professional and non-professional businesses. The specification states that:
“This present inventive System is unique in that it combines cash and accrual local accounting ledgers as well as management accounting systems into one unified platform which is readily accessible by any parent corporation or head business entity to monitor the cash systems and cash flow of individual subsidiary businesses. The local or subsidiary businesses also have their statutory required ledgers maintained in real time (with statutory requirements applied to all financial events) while reporting to their management ledger at the same time.”[12]
[12] Specification, page 13, lines 13-19.
Figure 1a, below, is a flow chart showing information regarding the operation of the Improved Ledger Accounting System:
Every financial event (112) is entered into the leading ledger (116). The specification further explains the flow chart as follows:
“This flow chart illustrates the mapping rules for sub-ledgers 128 which are part of leading ledger 116 and non-leading ledgers, if any. According to triggers and a predetermined set of rules, the location of the posting occurs based on preselected mapping/rules, which eventually end up in the management cash ledger 122, or based on the classification of the accounting basis used by the office involved, the relevant data are posted to the statutory cash ledger 126 in real time or statutory accrual ledger 118 in real time, or the process ends if they are not posted to any other ledgers. In an office or entity that utilizes accrual based accounting, statutory requirements 136 are applied to the postings in real time and posted into a statutory accrual ledger 118. In the same office that utilizes accrual based accounting, transfer rules 138 are applied to the postings input into the leading ledger and posted to the management cash ledger 122. The financial data 112 entered into the inventive system are manipulated by some or all of the following processes: the statutory accrual ledger 118 receives modified data according to statutory requirements 136 in real time; the management cash ledger 122 receives modified data according to transaction rules 138; and the statutory cash ledger 126 receives data modified to meet statutory requirements 140 in real time as they are posted into the management cash ledger 122. Posts can be made to the management cash ledger 122, statutory cash ledger 126, or statutory accrual ledger 118, or they can be made on a manual basis as well as to each of the three ledgers, 130, 134 or 132. The sub ledgers 128 depend from the leading ledger 116 and may consist of one or more of the following: accounts receivables, accounts payables and/or fixed asset accountings.”[13]
“If the firm or office follows a cash accounting basis, the statutory requirements are applied to the posts made into the management cash ledger 122 and are posted to the statutory cash ledger 126. The process ensures proper allocation of partial client payments in the modified cash ledger 122. For example, a portion of the client invoice is brought into the management cash ledger 122 proportionate to each amount of any partial payment made to a vendor. Also, proper handling of inter-company transactions between the leading ledger 116 and the management cash ledger 122 are ensured in this process. This includes proper population of the inter-company ledger headed in the modified cash ledger 122 which takes place when a portion of the inter-company client invoices or vendor payment has been brought into the modified cash ledger 122 proportionate to each amount of partial payment with inter-company populated consistent with the original document.”[14]
[13] Specification, page 14, line 7 - page 15, line 6.
[14] Specification, page 18, line 17 - page 19, line 6.
Figure 2, below, is a flow chart of the invention which allows for use of a modified or management cash ledger (122). The specification explains that:
“This parallel ledger functionality is used to meet reporting requirements on a cash or accrual basis by providing information from the following ledgers: management cash ledger 122, statutory cash ledger 126 and statutory accrual ledger 118. For example, the management cash ledger 122 may be used to calculate retained earning for partnership distributions. In this process, there are several types of ledgers, namely: a leading ledger 116 comprising a ledger integrated with subsidiary ledgers 128 of Figure 1a, and updated in all company codes; and a non-leading ledger - a parallel ledger to the leading ledger 116, that allows for alternative accounting principle postings. Non-leading ledgers such as the management cash ledger 122, statutory accrual ledger 118, etc. may have different fiscal year variants and different posting period variants per company (or entity) code and may, for example, be used for management cash ledgers 122 and statutory cash ledgers 126; and sub-ledgers 128 wherein the subsidiary ledgers 128 is a subset of the general or leading ledger 116 used in the company’s accounting. This process allows for a plurality of each of these ledgers (Non-leading such as management cash ledgers 122, statutory accrual ledgers 118, statutory cash ledgers, and sub-ledgers 128) to be maintained collectively.”[15]
[15] Specification, page 15, line 9 - page 16, line 3.
The specification goes on to explain:
“The Improved Ledger Accounting Method 100 has the ability to post transactions to the statutory cash ledger 126 based on preselected criteria such as events, account numbers, document types, and other conditions. Through a trigger mechanism these preselected criteria are able to control modified statutory cash ledger 126 postings, based on the specific criteria preselected, such as Document Types/Events. For example, the document types that can be input into the Improved Ledger Accounting Method 100 may involve a key that distinguishes the business transactions to be posted. The document type can be used to determine where the document is stored and specify the account types to be posted.”[16]
[16] Specification, page 16, lines 10-18.
Various other features of the system are also disclosed, for example:
· ability to post a ledger-specific posting to a non-leading ledger such as the management cash ledger, management cash allocations, or statutory only posting
· ability to post open items and reconciliation accounts in the non-leading ledger
· ability to run foreign currency revaluation independently for specific purposes
· ability to produce management reports quickly and efficiently from the management cash ledger, and create other specific reports
No specific detail about the implementation of the accounting method is described, with the specification indicating that:
The present invention may be implemented on any conventional or on any general purpose computer system not limited to: desk top computers, laptop computers, tablets, or cell phones and the like. … The present invention may be implemented manually or in any type of computer system or programming or processing environment and on a wide variety of CPU’s, including solid state and/or EEPROM based systems.”[17]
[17] Specification, page 5, lines 3-12.
The claims
The specification ends with 16 claims. Claim 1, directed to an accounting system, and claim 11, directed to a method for operating an accounting system, are the only independent claims. Claim 1 reads as follows:
An accounting system, configured to manage financial data from a plurality of computer devices, the accounting system including:
a database;
an application server including a processing device and a non-transitory storage medium for storing instructions that, when executed by the processing device, cause the processing device to perform the following in real time:receive, by the database, financial data associated with different document types from the plurality of computer devices, the different document types having different keys;
store, by the application server, the financial data in a leading ledger database implemented in the database;
process, by the application server, the financial data according to pre-defined transfer rules, wherein:
a management cash ledger database receives at least some of the financial data from the leading ledger database in real time, the management cash ledger database maintaining global financial data for a plurality of local offices;
a statutory cash ledger database automatically receives, based on a trigger mechanism determining that at least one of the keys for the different document types is a preselected type, at least some of the financial data from the management cash ledger database in real time which is modified according to statutory rule requirements for the statutory cash ledger database, the statutory cash ledger database maintaining first local financial data for one of the plurality of local offices; and
a statutory accrual ledger database automatically receives at least some of the financial data from the leading ledger database in real time which is modified according to statutory rule requirements for the statutory accrual ledger database, the statutory accrual ledger database maintaining second local financial data for one of the plurality of local offices.
Essentially, claim 11 recites a method for operating an accounting system in corresponding terms to claim 1.
No issues with the construction of the pending claims have been raised during examination. It is apparent that the system, including a database and an application server manages data from a plurality of computer devices and receives and stores financial data in parallel ledgers. Appended claims 2-9 and 12-16 define further details of the accounting system. For example, claims 2 and 12 define that the financial data corresponds to any one of: client invoices, vendor invoices, client payments, vendor payments and fixed assets; claims 4 and 14 define that the financial data stored in the management cash ledger database classified according to both accrual and cash accounting is modified into a uniform currency; and claim 10 defines that the statutory cash ledger database maintains a country-specific profit and loss statement. The complete claim set is reproduced at Annex A.
As some emphasis is placed in the applicant’s written submissions on the feature of “based on the trigger mechanism determining that at least one of the keys for the different document types is a preselected type”, I will make some observations regarding this aspect of the claims. As extracted above, the specification indicates that the “the document types that can be input into the Improved Ledger accounting Method 100 may involve a key that distinguishes the business transactions to be posted.”[18] Clearly this is the embodiment captured by the claims, given that the claimed system defines “the different document types having different keys”. There is no specific detail regarding the nature of the key, or implementation of this feature, provided in the description. Accordingly, I understand that the key may take any possible form which facilitates distinction of various business transactions, and that this, and implementation of the method including this feature, would be understood by the skilled person.
[18] Specification, page 16, lines 15-17.
The objection
The objection of lack of manner of manufacture maintained in the second examination report is the subject of the applicant’s request to be heard and reads as follows:
Claims 1-16 do not define a manner of manufacture within the meaning of Section 18(1)(a) of the Patents Act 1990 according to the principles set out in D'Arcy v Myriad Genetics Inc [2015] HCA 35 (Myriad), Commissioner of Patents v RPL Central Pty Ltd [2015] FCAFC 177 (RPL) and other cases. The claimed invention, as a matter of substance rather than form, is not suitable subject matter for a patent. The substance of the claimed invention is to be determined by considering the claimed invention’s actual or alleged contribution to the art.
From reading your application as a whole the claimed invention’s actual or alleged contribution to the art, hence the substance of the alleged invention is an accounting scheme for transferring portions of financial data from one ledger to a plurality of other ledgers, the transferring being conditioned on certain business criteria such as account numbers, document types [presumably invoice document, payment document etc].
The applicant has argued in the response that the claimed invention “provides a technical solution to a technical problem regarding how to collectively maintain multiple parallel legers which has previously not been achievable”. However the applicant did not identify what could be termed a technical problem with existing computers or conventional databases which the applicant seeks to solve. In this regard, the applicant simply provided the following broad statement : “the claimed subject matter seeks to address at least the technical problem regarding how to improve upon existing systems for processing financial data according to accounting requirements.” However, I consider this to be vague at best and that this statement does not identify a specific technical problem with existing/conventional database structures, processor architecture, network infrastructure etc.
With respect to the applicant's reference to Aristocrat Technologies Australia Pty Limited v Commissioner of Patents [2020] FCA 778, the examiner responds as follows.
Aristocrat formulated a two-stage analysis at [91] such that:
·The initial question is whether the claimed invention is for a mere scheme or business method of the type that is not the proper subject matter of a grant of letters patent and…
·If the above question is answered in affirmative, the subsequent inquiry becomes whether the computer-implemented method is one where invention lay in the computerisation of the method.
It is plain that the claimed invention relates to an accounting process involving a plurality of ledgers, one of which holds more information than the other ledgers. Thus, the answer to question 1 above is yes.
Proceeding to question 2, there is no invention in the computerisation of the identified scheme. This is because having considered the claims as a whole including any potential interworking relationship between different features, and taking the factors identified in RPL into consideration, the claimed invention:
·does not provide a contribution that is technical in nature
·does not result in an improvement in the functioning of a computer, irrespective of [i.e. independent of the type of] data being processed
·requires generic computer implementation
Therefore, the claimed invention fails the above test for patentability.
Aristocrat requires that a patentable invention should be for a specific-purpose device, that is a well-defined computing device that has been designed to only perform the specific functions defined by the claims and where it will not be possible for the user of this device to customise it to perform other actions. This is not so in the present claims where the only technical features recited are generic computing features such as computer devices, database, application server etc, noting that these features [and their combination] may be applied for other purposes. Thus, it is considered that the claimed invention does not pertain to a specific purpose device or a machine of particular construction as in Aristocrat.
Regarding Jagwood Pty Ltd [2020] APO 38), the Hearing Officer in that decision did identify a "technical solution perspective" at paras 81 & 83 which provided a technical solution to two technical problems identified in that case. However, it is not apparent that the claimed invention leads to an improved computing arrangement. Therefore, your claim is distinguished from Jagwood, since it does not provide any technical contribution to the art.
The applicant has further argued thus: “In view of the clear principles established in the most recent Full Federal Court decision in ROKT 2 wherein consideration of “common general knowledge” regarding the assessment of patentable subject matter should only be considered “to the extent necessary, to construe the specification” and should not be relied upon when considering the extent to which a computer as claimed is operating according to its “well-known and understood functions”, the Examiner’s objection appears ill-founded.”
However, in the same Rokt decision, it was stated as follows (para 73): “The role of expert evidence in construing the patent specification and the claims … is to place the Court in the position of the person acquainted with the surrounding circumstances as to the state of the art and manufacture as at the priority date”. In other words, the Court held that in determining the substance of the invention for assessing manner of manufacture, it is acceptable to have regard to evidence “as to the state of the art and manufacture as at the priority date”. This clearly permits reference to the common general knowledge.
The applicant has also argued that the receiving of financial data into a ledger based on a trigger mechanism pertaining to keys for different document types results in a specific combination of technical features that involve more than mere data processing. However, the trigger mechanism and the keys as claimed are mere business rules. For example, the specification indicates that a key distinguishes the business transactions to be posted. Furthermore, from the specification, the document types appear to be invoices, payment document etc. These are not technical features but mere business classifications of documents or information records. Thus, the use of document type to trigger posting to a particular ledger resides in the application of mere business rules to facilitate recording of accounting information. This is nothing but a scheme.
On the overall, the claims do not define a new technical contribution to the art as there is no new technical feature [or new combination of technical features] defined in these claims. Therefore, your claims are not for patentable subject matter.
The law on manner of manufacture
It is a requirement of paragraph 18(1)(a) of the Act that an invention be a manner of manufacture within the meaning of section 6 of the Statute of Monopolies. The classic question to be asked when deciding whether an invention is a “manner of manufacture” is set out in National Research Development Corporation v Commissioner of Patents:[19]
“The right question is: ‘Is this a proper subject of letters patent according to the principles which have been developed for the application of s. 6 of the Statute of Monopolies?’”[20]
[19] [1959] HCA 67; 102 CLR 252 (‘NRDC’).
[20] NRDC at 269, [14].
The High Court went on to set out a test in terms relevant to the facts of that case:
“a process, to fall within the limits of patentability which the context of the Statute of Monopolies has supplied, must be one that offers some advantage which is material, in the sense that the process belongs to a useful art as distinct from a fine art ... that its value to the country is in the field of economic endeavour.”[21]
and
“The effect produced by the appellant's method exhibits the two essential qualities upon which ‘product’ and ‘vendible’ seem designed to insist. It is a ‘product’ because it consists in an artificially created state of affairs, discernible by observing over a period the growth of weeds and crops respectively on sown land on which the method has been put into practice. And the significance of the product is economic; for it provides a remarkable advantage, indeed to the lay mind a sensational advantage, for one of the most elemental activities by which man has served his material needs, the cultivation of the soil for the production of its fruits.”[22]
[21] NRDC at 275, [22].
[22] NRDC at 277, [25].
However, the High Court has made clear that there is no precise formulation to be applied unthinkingly to answer the question of manner of manufacture:
“This Court in NRDC did not prescribe a well-defined pathway for the development of the concept of ‘manner of manufacture’ in its application to unimagined technologies with unimagined characteristics and implications. Rather, it authorised a case-by-case methodology.”[23]
[23] D’Arcy v Myriad Genetics Inc [2015] HCA 35; 258 CLR 334 at [23] (‘Myriad’).
That case-by-case methodology must have regard to the substance of the claimed invention, and not simply the form of the claim.[24] This point was made succinctly in Myriad by Gageler and Nettle JJ:
“Whatever words have been used, the matter must be looked at as one of substance and effect must be given to the true nature of the claim.”[25]
[24] Myriad at [6], [88].
[25] Myriad at [144].
In Commissioner of Patents v RPL Central Pty Ltd[26] the Full Court of the Federal Court said the same thing in the context of an invention that was in substance a scheme:
“A claimed invention must be examined to ascertain whether it is in substance a scheme or plan or whether it can broadly be described as an improvement in computer technology. The basis for the analysis starts with the fact that a business method, or mere scheme, is not, per se, patentable. The fact that it is a scheme or business method does not exclude it from properly being the subject of letters patent, but it must be more than that. There must be more than an abstract idea; it must involve the creation of an artificial state of affairs where the computer is integral to the invention, rather than a mere tool in which the invention is performed. Where the claimed invention is to a computerised business method, the invention must lie in that computerisation. It is not a patentable invention simply to ‘put’ a business method ‘into’ a computer to implement the business method using the computer for its well-known and understood functions.
Is the mere implementation of an abstract idea in a well-known machine sufficient to render patentable subject matter? Is the artificial effect that arises, because information is stored in RAM and there is communication over the Internet or wifi, sufficient? Does any physical effect give rise to a manner of manufacture? Are the mere presence of an artificial effect and economic utility, without more, sufficient to determine manner of manufacture?
It is not a question of stating precise guidelines but of deciding, in each case, whether the claimed invention, as a matter of substance not form, is properly the subject of a patent.”[27]
[26] [2015] FCAFC 177 (‘RPL Central’).
[27] RPL Central at [96]-[98].
In Research Affiliates LLC v Commissioner of Patents[28] the Full Court of the Federal Court stated:
[28] [2014] FCAFC 150 (‘Research Affiliates’).
“When the authorities in Australia prior to and including Grant are considered, a consistent approach emerges as to the relevance of:
· a distinction between a claim to a business scheme and claims to methods which in practice result in a new machine or process or an old machine giving a new and improved result – that is, a distinction between mere intellectual information and a method that affects the operation of an apparatus in a physical form (Grant at [18]);
· the fact that the claimed steps are foreign to the normal use of computers, such as the production of an improved curve image (IBM 2 at 225-226);
· the particular mode or manner of achieving an end result which is an artificially created state of affairs, such as the storage of data as to Chinese characters and retrieval of graphic representations to enable word processing (CCOM at 295);
· whether part of the invention is an inventive method which includes the application and operation in a physical device (Grant at [30]);
· the distinction drawn in Catuity, as explained in Grant (at [24]), between ‘a technological innovation which is patentable and a business innovation which is not’. In Catuity, Heerey J did not accept that a physically observable effect was necessarily required (at [128]) but the Full Court in Grant expressed the opinion that a physical effect in the sense of a concrete effect or phenomenon, or manifestation or transformation is required (at [32]).
· the fact that a physical effect is required does not make it sufficient to confer patentability;
· the fact that a method may be called a business method does not prevent it being properly the subject of letters patent (Grant at [26] citing Catuity at [125]-[126]);
· the fact that for claimed computer programs, the courts look to the application of the program to produce a practical and useful result, so that more than ‘intellectual information’ is involved (Grant at [29]). A method that is in the nature of directions for use does not constitute an invention or a manner of manufacture in the absence of some previously unrecognised property of an aspect of the method (Grant at [29]).”[29]
[29] Research Affiliates at [94].
In considering the substance of the invention the Full Court went on to say:
“In the context of the claim, the significance lies in the content of the data rather than any specific effect generated by the computer. The computer-implementation is an essential integer of the claimed process. That is, of course, important. It is of particular importance in the assessment of, for example, novelty and infringement. However, in examining whether a claimed invention is properly the subject of letters patent, it is necessary to look not only at the integers of that claimed invention but also at the substance of that invention.
The claimed method in this case clearly involves what may well be an inventive idea, but it is an abstract idea. The specification makes it apparent that any inventive step arises in the creation of the index as information and as a scheme. There is no suggestion in the specification or the claims that any part of the inventive step lies in the computer implementation. Rather, it is apparent that the scheme is merely implemented in a computer and a standard computer at that. It is not part of the claimed method that there is an improvement in what might broadly be called ‘computer technology’.[30]
[30] Research Affiliates at [117]-[118].
The Full Court in Encompass Pty Ltd v InfoTrack Pty Ltd[31] did not find it necessary to revisit the correctness of RPL Central or Research Affiliates, explaining that:
“In each case, the Full Court was seeking to describe the conceptual distinction between a manner of manufacture and an unpatentable abstraction. In each case, the Full Court was explaining that a claimed method that is unpatentable does not change its legal character merely because the method is implemented by the instrumentality of a computer.”[32]
[31] [2019] FCAFC 161; 372 ALR 646 at [7] (‘Encompass’).
[32] Encompass at [91].
In a similar vein, the Full Court in Aristocrat ’21 observed recently in relation to a claim defining an electronic gaming machine (EGM) with a particular feature game:
“What this purpose-specific but extremely common computer does is play the feature game. Consequently, the substance of the invention disclosed by Claim 1 is that feature game implemented on the computer which is an EGM. It is therefore a computer-implemented invention.
As we have already observed, integers 1.10-1.12 embody an abstract idea which may be characterised both as a set of rules defining a family of games and as a business scheme for increasing player interest in an EGM. As such its implementation in the computer which is an EGM cannot constitute patentable subject matter unless it represents an advance in computer technology.”[33]
[33] Aristocrat ’21 at [56]-[57].
The following summary of considerations relevant to assessing whether computer related invention is in substance a manner of manufacture was provided by the delegate in Aristocrat Technologies Australia Pty Ltd,[34] and remains relevant in view of the subsequent Full Court decisions:
[34] [2016] APO 49 at [35] (‘Aristocrat ’16’).
“I conclude that it is relevant to consider a range of matters. Without seeking to be exhaustive, these include:
·there must be more than an abstract idea, mere scheme or mere intellectual information;
·is the contribution of the claimed invention technical in nature;
·does the invention solve a technical problem within the computer or outside the computer;
·does the invention result in improvement in the functioning of the computer, irrespective of the data being processed;
·does the application of the method produce a practical and useful result;
·can it be broadly described as an improvement in computer technology;
·does the method merely require generic computer implementation;
·is the computer merely an intermediary or tool for performing the method while adding nothing of substance to the idea;
·is there ingenuity in the way in which the computer is utilised;
·does the invention involve steps that are foreign to the normal use of computers; and
·does the invention lie in the generation, presentation or arrangement of intellectual information.”
Summary of the applicant’s submissions
The applicant submitted that:
“the Examiner has incorrectly characterised the substance of the presently claimed invention by continuing to assert an inappropriate requirement for a ‘technical improvement’ in the computer technology without due consideration regarding a possible improvement in respect of ‘how’ the computer technology is used.”
The applicant referred in particular to two recent decisions of the Patent Office: Jagwood Pty Ltd[35] and eBay Inc.[36]These decisions represent applications of the principles derived from decisions of the courts, including those discussed above, to particular facts and I will discuss these decisions in more detail below; at this point it suffices to note that the applicant draws the following principles from these decisions:
·a claimed invention may constitute patentable subject matter despite involving only the use of a generic computing device (as per the comments of the delegate in Jagwood)
·of the list of factors outlined in Aristocrat ’16, in view of the decision of the delegate in eBay, an invention which satisfies only two of those questions (“is the contribution of the claimed invention technical in nature” and “does the application of the method produce a practical and useful result”) may constitute patentable subject matter.
[35] [2020] APO 38 (‘Jagwood’).
[36] [2020] APO 49 (‘eBay’).
In the applicant’s submission, the claimed invention extends beyond a mere abstract idea, and provides a technical contribution and a practical and useful result. In particular:
“whilst the Examiner asserts in the Second Examination report that ‘…the trigger mechanism and the keys as claimed are mere business rules’, the Applicant respectfully submits that the Examiner’s characterisation in this regard is incorrect and this particular combination of features should be considered to comprise features that contribute to the claimed invention being ‘technical in nature’ and also contributing to the provision of a practical and useful result.”
Consideration
As a matter of subject matter, the claims are directed to an accounting system and associated method providing specified results with respect to financial data and relying on various hardware and software components: databases, processing device, non-transitory storage medium. However, it is the substance, not the subject matter, of the claimed invention that is important to the assessment of manner of manufacture.
From a consideration of the specification, I understand the invention described and claimed to address problems relating to managing financial data across multiple parallel ledgers according to certain criteria. In particular, the claimed invention provides for:
·receipt by a management cash ledger database of at least some financial data from the leading ledger database in real time;
·receipt, based on a trigger mechanism determining that a key for different document types is a preselected type, by a statutory cash ledger of at least some of the financial data from the management cash ledger data in real time and modified according to statutory rule requirements; and
·receipt by a statutory accrual ledger database of at least some financial data from the leading ledger database in real time modified according to statutory rule requirements;
wherein the statutory cash ledger database maintains first local financial data for one of the local offices and the statutory accrual ledger maintains second local financial data for one of the local offices.
It is clear that the claimed invention affords results useful in the business sphere. However, this does not preclude the claims defining patentable subject matter, and, in determining where the substance of the invention lies, I will have regard to a range of the considerations set out in Aristocrat ’16, noting that the applicant placed particular significance on the considerations of practical and useful result and whether the contribution of the claimed invention is technical in nature. It should of course be noted that these considerations are simply guides to understanding where the substance of the invention lies rather than a means for mechanically determining whether the claims define patentable subject matter.
In considering this matter I have had regard to the applicant’s submissions of 16 December 2020 in response to the first examination report in addition to the written submissions of 26 April 2021 and 28 January 2022 as appropriate.
Does the invention as claimed solve a technical problem within the computer or outside the computer?
In the submissions of 16 December 2020, the Applicant submitted that:
“the claimed subject matter seeks to address at least the technical problem regarding how to improve upon existing systems for processing financial data according to accounting requirements.”
I accept that this is a reasonable, albeit broad, characterisation of the problem to which the specification is directed to addressing. But this is a problem that may conceivably be addressed by technical innovations, which are patentable, or business innovations, which are not.
The applicant further stated that:
“the claimed invention (as amended) provides a technical solution to a technical problem regarding how to collectively maintain multiple parallel legers which has previously not been achievable using conventional systems including ERP systems or various other similar systems”
While it is apparent that the computer must be able to carry out the defined accounting system, there is no suggestion in the specification that any particular technical problem within a computer has been solved in order to arrive at this. That is, it not apparent what, if any, technical obstacle has been overcome in order to implement the claimed invention. I cannot see any basis to conclude that a technical problem in a computer is solved by the claimed invention.
The applicant also submitted that the invention provides advantages in elimination of data redundancy, thereby providing a solution to a technical problem:
“the Applicant respectfully submits that the claimed invention extends beyond a mere abstract idea and addresses the technical problems associated with an inability associated with conventional systems to collectively maintain multiple parallel ledgers and inefficient processing of data arising as a result of data redundancy thereby causing a wastage of computing resources.”
“the defined system of the claimed invention results in several material benefits/advantages including, for example, increased efficiency and the elimination of data redundancy which in turn, results in a conservation of computer processing and memory resources. Therefore, the claimed invention results in a technical contribution by reducing processing and memory requirements that would otherwise be required.”
I can accept that, as stated in the specification, a “consolidated global system eliminates data redundancy, and is more expedient and cost effective”.[37] However, I do not see this as an expression of a solution to a technical problem. In my view, problems of data duplication in the context of the invention are business problems – associated with particular methods of processing business data – and the solution provided by the claimed accounting system is a business solution.
Does the invention use generic computer technology?
[37] Specification, page 7, lines 15-16.
I will say at the outset that I am mindful of the cautionary comments of the majority of the Full Court in Aristocrat ’21 concerning the use of the terminology “generic” in relation to computer technology and software, where Middleton and Perram JJ said “it is unclear to us what [‘generic computer technology’ or ‘generic software’] actually mean”,[38] and that “to enquire into whether a computer is generic does not seem to add much to the basic question of whether the invention claimed represents an advance in computer technology.”[39] However, Nicholas J elaborated on the meaning of generic computer technology as being that which is “purely conventional, and is utilised for its well-known and well-understood effects”, and identified this as “a useful signpost when deciding whether, what began as an abstract scheme or idea, has been transformed into something that is sufficiently different to constitute an artificially created state of affairs.”[40] I note also that reference to generic computer technology was made by the Full Court in Repipe Pty Ltd v Commissioner of Patents.[41] Accordingly, I do not agree with the applicant’s contention that consideration of whether generic computer technology is used “should be avoided”, but I accept that some care should be taken with this consideration, and, as pointed out by the applicant, the majority in Aristocrat ’21 made clear that use of a “generic” computer to implement an invention does not preclude the invention being characterised as, broadly, an advance in computer technology.[42]
[38] Aristocrat ’21 at [35].
[39] Aristocrat ’21 at [38].
[40] Aristocrat ’21 at [112].
[41] [2021] FCAFC 223 (‘Repipe’).
[42] Aristocrat ’21 at [36]-[37]. See also Repipe at [9].
However, I do not agree that, as put, somewhat surprisingly, by the applicant, “a claimed invention solely involving the implementation of an abstract idea on a generic computer is not sufficient to support a conclusion that the claimed invention lacks patentable subject matter.” RPL and Aristocrat ’21, to which the applicant refers in support of this proposition, are discussed above and are not consistent with such a conclusion; something more than merely implementation of an abstract idea on a generic computer utilising well-known and understood functionality is required.[43] In any event, there is, as indicated in Myriad, no precise verbal formula for the determination of manner of manufacture.
[43] See, e.g. Aristocrat ’21 at [89], [118]-[119].
In summary, clearly a number of the considerations in Aristocrat ’16 touch on aspects of the central issue identified by the majority in Aristocrat ’21: an advance in computer technology. Consistent with the balance of Full Court authority, where the disclosure of the computer technology (hardware or software) is at a generic/broad level, and the use thereof is conventional or standard, this will generally be indicative of an absence of any advance in the technology that is so described.
As noted previously, the present specification explains that the invention may be implemented on any conventional or general-purpose computer. There is no indication that any unusual computing elements or arrangement thereof is used. I do not understand the applicant to dispute that this is the case.
Is there an improvement in the computer?
The computer is improved to the extent that it appears that it can carry out a function that it did not previously (to the extent that the examiner has not raised prior art relevant to the novelty of the pending claims). This is not, in itself, an improvement relevant when considering manner of manufacture.[44]
[44] Commissioner of Patents v Rokt Pte Ltd [2020] FCAFC 86 at [98] (‘Rokt’); Repipe Pty Ltd v Commissioner of Patents [2019] FCA 1956 at [37], [44]-[47].
The applicant referred to CCOM Pty Ltd v Jiejing Pty Ltd[45] and the reference thereto in the Patent Manual of Practice and Procedure (‘the Manual’) in support of the proposition that an abstract idea implemented on a generic computer may be patentable if the computer can be considered “improved”. The invention in CCOM related to use of a keyboard to generate Chinese characters and was characterised by the Full Court in Research Affiliates as:
“using a particular method of characterisation of character strokes, applied to an apparatus in such a way that the operation of a keyboard would enable the selection (through a computer) of the appropriate Chinese characters required for word processing in that language”.
[45] [1994] FCA 1168 (‘CCOM’).
Although CCOM was decided before Myriad and Research Affiliates (and the subsequent series of Full Court decisions concerning computer-implemented inventions), it can be understood at a general level as providing an improvement in computer technology. The Full Court in CCOM said:
“The NRDC Case (102 CLR at 275-277) requires a mode or manner of achieving an end result which is an artificially created state of affairs of utility in the field of economic endeavour. In the present case, a relevant field of economic endeavour is the use of word processing to assemble text in Chinese language characters. The end result achieved is the retrieval of graphic representations of desired characters, for assembly of text. The mode or manner of obtaining this, which provides particular utility in achieving the end result, is the storage of data as to Chinese characters analysed by stroke-type categories, for search including ‘flagging’ (and ‘unflagging’) and selection by reference thereto.”[46]
[46] CCOM at [128].
This is consistent with the way the Manual characterises CCOM:
“While the decision did not say it, an improved data structure that [facilitates] the easier or improved finding of items in a computer implemented searching device has a material advantage. It is not business administration, nor merely information.”
The applicant submitted that:
“the present invention may be regarded analogous to the CCOM claims since the present claims define a method that, when implemented on a standard computing device, results in more efficient data processing, elimination of data redundancies thereby resulting in improved accounting system operation requiring less processing and memory resources to achieve the result according to the solution defined in the pending claims.”
Even accepting that the present invention and the CCOM invention both provide efficiency, I do not agree that the present invention is in substance analogous to the CCOM invention. In CCOM the invention could be characterised as providing an improved computer in the sense that a technical limitation in the operation of a computer to assemble Chinese text was overcome. The present invention does not, as described, overcome any limitation in computing technology or provide an improved computer in this sense. Rather, it provides for automated transfer and modification of financial data based on predetermined rules – to my mind this is conventional use of computing technology. Conserved computer processing and memory resources in this context are not indicative of an improvement in the computer as such.
Are there any steps foreign to the normal use of computers?
The specification provides no specific details of how to implement the system on a computer. This suggests that the applicant considers the method can be implemented using nothing more than the common general knowledge.
The applicant addressed this consideration in the submissions of 16 December 2020 and submitted, referring to the decision of the Full Court in Rokt, that common general knowledge “should not be relied upon when considering the extent to which a computer as claimed is operating according to its ‘well-known and understood functions’”. The applicant submitted that “the utilization of the claimed computer components in the present claims (as amended) extends beyond the use of those computer components in combination solely for their basic, typical or well-known functions” and that a careful review of the claims and specification “cannot reasonably lead to a conclusion that the invention … is in substance a scheme that solely utilizes computers for their basic, typical and well-known functions.”
However, the applicant did not identify any particular aspect of the invention which involves steps foreign to the normal use of computers, and I consider that a review of the specification does lead to a conclusion that the invention uses computers for their usual and well-known functions. In this regard, I understand the Full Court in Rokt to have said that steps “foreign to the normal use of computers” are those that a computer would not normally be used to perform, rather than particular steps which have not previously been performed by a computer.[47] Consideration of the specification itself, like in Rokt, reveals nothing to indicate that the hardware and software involved is being used other than for its ordinary and well-known purposes.
Is there a practical and useful result?
[47] Rokt at [100].
The applicant submitted that the claims “clearly give rise to a practical and useful result”. I understand this result to lie in the collective maintenance of multiple parallel ledgers, with ledgers receiving financial data in real time and modified in accordance with statutory rule requirements. While it may be accepted that this is useful, the question is whether this is a “practical and useful result” in the relevant sense. In this regard, the observation of the Deputy Commissioner in CareFusion 303, Inc.[48] that “[n]ot every result which might colloquially be considered useful is relevant” is apt. He went on to refer to Full Court’s statement in Research Affiliates:
“To take the words of NRDC at 268, the process does not produce ‘either immediately or ultimately, a useful physical result in relation to a material or tangible entity.’ The claimed method, the result of the ingenuity of the inventors, does not produce such a result; the ingenuity is in the scheme. Again, drawing from NRDC at 270, there is a useful result of the claimed process but there is no physical thing ‘brought into existence or so affected as the better to serve man’s purposes’. There is no ‘physical phenomenon in which the effect, be it creation or merely alteration, may be observed’ (NRDC at 276).”[49]
[48] [2021] APO 11 at [58] (‘CareFusion’).
[49] Research Affiliates at [114].
Of course, a physical product as such need not result for there to be a practical and useful result of a method or scheme. Indeed, in CareFusion the Deputy Commissioner was satisfied that reduced wastage of medications was a practical and useful result of a scheme implemented by generic computer technology. A “practical and useful” result is one that is just that – practical or “real world”, rather than abstract.
In eBay, to which the applicant referred, the delegate indicated that the result, physical directions for a recommended route to avoid congestion provided to a user, was “a practical and useful result that is not related to a business process or business rules”[50] and concluded that:
“In contrast to that defined in Research Affiliates, RPL, Encompass, and Rokt, the claims of this application clearly define more than an abstract idea. In combination the claims define changing the physical directions provided to a user based on at least the current time, a time to start or restart of the event and congestion along the route to get to the point of interest. The provision of physical directions for the user to take, as claimed, is not considered to be abstract or implementing a business process, but rather a physical and technical solution to a physical and technical problem that provides a practical and useful result.”[51]
[50] eBay at [41].
[51] eBay at [43].
That is, the “practical and useful result” of the scheme identified by the delegate was considered to be more than simply the result of implementing a business process within a computer, and to afford a physical result and a solution to a physical and technical problem.
In contrast, while the claimed accounting system provides for real-time automated transfer and modification of financial data based on predetermined rules, the result does not extend beyond being simply the result of the implementation of the system and rules on a computer. That is, there is no effect other than the implementation of the scheme and no physical thing or phenomenon is brought into existence as discussed in Research Affiliates. While I accept that the use of the claimed system may well be advantageous in a business context, and provide a useful result in the colloquial sense, I do not consider it to provide a “practical and useful result” as understood by reference to either eBay, or, more particularly, the Full Court decisions to which eBay refers.
Is the contribution of the claimed invention technical in nature?
The applicant submitted that:
“…the Examiner has failed to afford due weight to various features presently recited in the pending claims regarding the contribution of those various features, or combinations thereof, to the invention, and in particular, to the statutory cash ledger database automatically receiving, based on the trigger mechanism determining that the at least one of the keys for the different document types is a preselected type, modified financial data in real time from the management cash ledger database and the statutory accrual ledger database automatically receiving, in real time, modified financial data from the leading ledger.
The Applicant respectfully submits that … the contribution of the combination of technical features is technical in nature …”
and elaborated:
“the combination of technical features recited in the claims including at least the statutory cash ledger database receiving modified financial data from the management cash ledger database based on the trigger mechanism determining that at least one of the keys for the different document types is a preselected type, and the statutory accrual ledger database receiving modified financial data from the leading ledger, the claimed invention recites a specific combination of technical features that involves significantly more than mere data processing.
In other words, the Applicant respectfully submits that the present claims do not merely recite an abstract accounting scheme for transferring portions of data from one ledger to plurality of other ledgers as the Case Examiner contends, and instead, recites a specific technique which modifies financial data according to the statutory requirements based upon a specific key. This represents an ‘advance in computer technology’ since it provides a technical solution to the problem(s) faced by the inventors.”
As noted previously, the applicant rejected the examiner’s characterisation of the trigger mechanism and key as “mere business rules”, arguing that they contribute to the invention being “technical in nature”. Moreover, the applicant submitted that the examiner had failed to give due consideration to how computer technology is used in the claimed invention, referring to Jagwood, in which the delegate identified a “synergistic utilisation of technology” within the context of generic computer implementation.
In Jagwood the invention related to the use of an identifier having the dual purpose of supplying both the location of a financial document and the payment reference in an electronic payment solution, and the applicant in that case referred to a “matching problem” (matching of a payment with a financial document) and a “bandwidth problem” associated with the amount of information able to be entered into payment reference fields. The delegate indicated that these problems could plausibly be considered technical or non-technical. Having considered both technical and non-technical perspectives for characterising the claimed invention, the delegate concluded that the claimed invention provided a technical solution to these problems:
“The use of a computer (server) which: a) the payer uploads a financial document, b) assigns a URI, and c) allows the payee to download the financial document (once the URI has been communicated via the reference field in an electronic payment system) is considered a technical solution to the problems the invention sought to overcome. The location of the financial document and the use of this location in the reference field of the electronic payment system are inexorably intertwined with the computing and networking systems. It is a technical solution because this synergistic utilisation of technology overcomes the problems faced by the inventor.”[52]
[52] Jagwood at [83].
The applicant also referred to the finding of the delegate in eBay that obtaining congestion information during the course of an event is a technical problem requiring a technical solution and observed that the technical solution identified in eBay involved the application of well known congestion monitoring techniques. I note also that the delegate in Advanced New Technologies Co., Ltd[53] found that the use of a cryptographic technique, albeit well known, provided a technical contribution in a method of preserving privacy of blockchain nodes. I agree with the applicant’s submission that “an invention can reside in the combination of known technical features”. However, I am not persuaded that this is such an invention.
[53] [2021] APO 29.
It is true that the invention, and in particular the features of a trigger mechanism and a key, are intrinsically associated with computing technology. However, a “trigger mechanism” determining that a “key” is a preselected type and therefore processing financial data in a particular way does not, to my mind, represent a “synergistic utilisation of technology” or any other manner of technical advance in, or utilisation of, computing technology, but simply articulates the requirements of the defined system at a high level. That the nature and implementation of the “trigger mechanism” and “key” is left to the user is to my mind suggestive that these are not technical features, but abstract concepts which may be implemented using conventional computing technology. Accordingly, I cannot agree with the applicant’s contention that the technique defined by the claim represents an “advance in computer technology” or technical contribution.
I cannot, based on the applicant’s submissions or the specification, identify any improvement in the way that computer technology is used that could be considered to define a technical contribution, and nor does the result of the system or method provide such a contribution.
Conclusion
Having regard to the invention as claimed (in independent claims 1 and 11 as well as the dependent claims) and the above considerations, I conclude that the substance of the invention is an accounting scheme for storing financial data in, and transferring financial data between, multiple parallel ledgers. It solves a business problem, and the innovation is a business innovation rather than a technical innovation. There is nothing in the specification to suggest that anything more than generic or standard implementation in a computer is required. In accordance with the Full Court authorities discussed previously, this is not patentable subject matter.
Conclusion
The claimed invention is not for a manner of manufacture. I have briefly discussed the disclosure of the specification previously and having reviewed the specification I can see no subject matter that could be made the subject of a valid claim to overcome this finding. In these circumstances it is appropriate to refuse the application.
Dr S. J. Smith
Delegate of the Commissioner of PatentsAnnex A
1. An accounting system, configured to manage financial data from a plurality of
computer devices, the accounting system including:a database;
an application server including a processing device and a non-transitory storage medium for storing instructions that, when executed by the processing device, cause the processing device to perform the following in real time:
receive, by the database, financial data associated with different document types from the plurality of computer devices, the different document types having different keys;
store, by the application server, the financial data in a leading ledger database implemented in the database;
process, by the application server, the financial data according to predefined
transfer rules, wherein:
a management cash ledger database receives at least some of the financial data from the leading ledger database in real time, the management cash ledger database maintaining global financial data for a plurality of local offices;
a statutory cash ledger database automatically receives, based on a trigger mechanism determining that at least one of the keys for the different document types is a preselected type, at least some of the financial data from the management cash ledger database in real time which is modified according to statutory rule requirements for the statutory cash ledger database, the statutory cash ledger database maintaining first local financial data for one of the plurality of local offices; and
a statutory accrual ledger database automatically receives at least some of the financial data from the leading ledger database in real time which is modified according to statutory rule requirements for the statutory accrual ledger database, the statutory accrual ledger database maintaining second local financial data for one of the plurality of local offices.
2. An accounting system according to claim 1, wherein the financial data corresponds to any one of: client invoices, vendor invoices, client payments, vendor payments, and fixed assets.
3. An accounting system according to either claim 1 or claim 2, wherein those executable instructions that, when executed by the processing device, cause the management cash ledger database to receive at least some of the financial data from the leading ledger database, are further operative to store the financial data that is classified according to both accrual and cash accounting.
4. An accounting system according to claim 3, wherein the financial data stored in the management cash ledger classified according to both accrual and cash accounting is modified into a uniform currency.
5. An accounting system according to any one of the preceding claims, wherein those executable instructions that, when executed by the processing device, are further operative to relocate financial data from the leading ledger database to the statutory accrual ledger database when the pre-defined transfer rule has a status of post.
6. An accounting system according to any one of the preceding claims, wherein those executable instructions that, when executed by the processing device are further operative to relocate financial data from the management cash ledger database to the statutory cash ledger database when the pre-defined transfer rule has a status of pay.
7. An accounting system according to any one of the preceding claims, wherein the processing device is configured to calculate retained earnings for partnership distributions using the management cash ledger database.
8. An accounting system according to any one of the preceding claims, wherein the management cash ledger database and the statutory accrual ledger database maintain different fiscal year variants.
9. An accounting system according to any one of the preceding claims, wherein the management cash ledger database and the statutory accrual ledger database maintain different posting period variants.
10. An accounting system according to any one of the preceding claims, wherein the statutory cash ledger database maintains a country-specific profit and loss statement.
11. A method for operating an accounting system including an application server
operatively connected to a database and to a plurality of computer devices, the method
including:receiving, by the database, financial data associated with different document types from the plurality of computer devices, the different document types having different keys;
storing, by the application server, the financial data in a leading ledger database
implemented in the database;
processing, by the application server, the financial data according to predefined transfer rules including:
receiving, by a management cash ledger database, at least some of the financial data from the leading ledger database in real time, the management cash ledger database maintaining global financial data for a plurality of local offices;
automatically receiving, by a statutory cash ledger database based on a trigger mechanism determining that at least one of the keys for the different document types is a preselected type, at least some of the financial data from the management cash ledger database in real time which is modified according to statutory rule requirements for the statutory cash ledger database, the statutory cash ledger database maintaining first local financial data for one of the plurality of local offices; and
automatically receiving, by a statutory accrual ledger database, at least some of the financial data from the leading ledger database in real time which is modified according to statutory rule requirements for the statutory accrual ledger database, the statutory accrual ledger database maintaining second local financial data for one of the plurality of local offices.
12. A method according to claim 11, wherein the financial data corresponds to any
one of: client invoices, vendor invoices, client payments, vendor payments, and fixed
assets.13. A method according to either claim 11 or claim 12, wherein the step of receiving the financial data from the plurality of computer devices further includes:
receiving, by a management cash ledger database, at least some of the financial data from the leading ledger database in real time, wherein the management cash ledger database receives and stores financial data classified according to both accrual and cash accounting.
14. A method according to claim 13, wherein the financial data stored in the management cash ledger database classified according to both accrual and cash accounting is modified into a uniform currency.
15. A method according to any one of claims 11 to 14, wherein the step of processing the financial data according to pre-defined transfer rules further includes:
relocating the financial data from the leading ledger database to the statutory accrual ledger database when the pre-defined transfer rule has a status of post.
16. A method according to any one of claims 11 to 15, wherein the step of processing the financial data according to pre-defined transfer rules further includes:
relocating the financial data from the management cash ledger database to the statutory cash ledger database when the pre-defined transfer rule has a status of pay.
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