About inventory transactions

Creating receipts

Inventory receipts, created and viewed by using the Receipts (IN301000) window, are used to account for inventory received at a warehouse.
If the Purchases workspace is integrated with the Inventory workspace, the system creates inventory receipts automatically once purchase receipts have been released.

You can perform a direct receipt at a warehouse or warehouse location when some quantity of a stock item is received as the transferred inventory in a two-step transfer process.

Items with no transaction history

Also, during physical inventory, a receipt is generated for items with no history of transactions. The items are considered as newly received, and an inventory receipt is generated.

Posting settings for items

The information required to post transactions listed in automatically generated receipts comes from the posting class of the item, defined in the Posting classes (IN206000) window. When an inventory receipt based on a purchase receipt is released, the item's posting class determines the general ledger accounts (inventory account and Supplier ledger accrual account) to be updated. If the item has the average cost valuation method assigned, its costs are also updated.

Reason codes

The system inserts the default reason code for receipts, specified in the Inventory preferences (IN101000) window, automatically, but you can choose a more relevant reason code.
Reason codes are defined in theReason codes (CS211000) window.

For direct receipts, the system specifies the costs of items automatically based on the item valuation methods.
On release of a receipt, the inventory account (depending on posting settings) will be updated; the offset account will be determined by the reason code selected for the receipt line.

Creating issues

The system automatically generates issues, which allow you to account for inventory withdrawals and returns, upon release of sales orders, credit and debit notes, and kit assembly documents. You can create, view, or modify issues using the Issues (IN302000) window.

Direct issues

You can use a direct issue not linked to any sales order or note in the following situations:

• To remove expired or damaged goods
• To return excessively issued goods

If an issue is the result of an employee picking items to fill a sales order, the extended cost amount usually debits a cost of goods sold account and credits an inventory account, with the accounts determined by the posting class of the stock item.

With a direct issue, the extended cost amount decreases the inventory account balance and increases the balance of the offset account.
The chosen offset account depends on the reason of the transaction; in any case, it's a specific expense account.

Reason codes

Reason codes used for issues should provide offset accounts for specific types of issues. The system automatically inserts the default reason code for direct issues specified in the Inventory preferences (IN101000) window, but you can choose a more relevant reason code.

If the issue is made for kit assembling, the offset account is usually an expense account such as Material expense.

If the issue is made to remove expired goods, the offset account might be Expired goods' costs.

Return transaction

If a stock item was issued in excessive quantity and is being returned, or if an inventory withdrawal was incorrect or not needed, you can create a return transaction and specify a reason code for it. A return to inventory increases the balance of the inventory account and decreases the balance of the offset account specified by the reason code.

Creating adjustments

Adjustments can be created manually or by the system. You can enter, view, or modify adjustments in the Adjustments (IN303000) window.

Use of adjustments

You can use an adjustment in the following situations:

• To write off shrinkage occurring due to theft, loss, or expiration of goods.
• To correct a released issue or receipt.
• To adjust costs for items with FIFO and specific valuation methods. (The reference to the original receipt, and the date of receipt are required.)
• To document unrecorded gain or loss detected during stocktaking count. For example, previously written-off (as loss) items may reappear during counting.
• To create initial inventory balances for a new implementation.

Inventory transaction corrections

You can create an adjustment to correct a released transaction (receipt or issue) with an error.
Because the system records each inventory transaction for accounting purposes, you cannot delete an incorrect transaction.
An adjustment specifies a negative or positive quantity of the items and updates the inventory accounts.

In the process of standard cost updating, the system generates cost adjustments to update the respective inventory accounts and standard cost variation accounts.

In the process of stocktaking, when the data entry is completed, the system generates adjustments for items for which quantity on hand differs from count data.

Creating transfers

Occasionally, you might need to move inventory from one location or warehouse to another location or warehouse. In Visma Net, a transfer is created, viewed, and modified in the Transfers (IN304000) window.
You can use transfers to record two types of inventory movements.

• One-step transfer: Movement between different locations within a warehouse or between warehouses performed in one step
• Two-step transfer: Movement between different warehouses performed in two steps

One-step transfers

A one-step transfer documents the movement of items from one location to another one within the same warehouse.

Also, goods movement between two warehouses can be performed as a one-step transfer, if goods are moved immediately or very quickly (as with adjacent warehouses).

A batch generated for one-step transfer includes no transactions if inventory accounts and subaccounts used for the items are the same for the source and destination locations.
If the accounts and subaccounts differ, the system will generate journal entries for transactions performed between the inventory account used for the item at the source location, the in-transit account (specified in the Inventory preferences (IN101000) window), and the inventory account used for the item at the destination location.
If a transfer includes more than one line, the journal entry to the in-transit account is the summary for all line items.
The system selects unit costs for items automatically based on the items' valuation methods.

Two-step transfers

Two-step transfers are used for transferring inventory between any two warehouses located far enough from one another that they cannot be moved immediately.
In a two-step transfer, the stock items are issued from the source warehouse's location and costs of items are recorded to the in-transit account specified in the Inventory preferences (IN101000) window for all two-step transfers. Later, when the transferred inventory arrives at the target warehouse, the user creates an inventory receipt with a reference to the original inventory transfer document; the batch generated for the receipt will move the costs of goods from the in-transit account to the inventory account used for the items in the destination warehouse.

Depending on the item class, the quantities of in-transit goods may or may not be included in availability calculation.
The rules for inventory availability calculation are specified for each item class on the General information tab of the Item classes (IN201000) window.

Creating Kit assemblies

Kit assemblies, which you create using the Kit assembly (IN307000) window, are used to account for kits and their components.
As a result of assembly transactions, new kits (finished goods) are created and their quantity on hand increases, while quantities of the kit components are deducted by the quantities used in kits.

A batch generated on kit assembly release updates the following accounts:

• the inventory account associated with the kit at a particular warehouse,
• the inventory accounts associated with stock components, and
• the expense accrual accounts associated with non-stock components.

As noted, you use reason codes to indicate why inventory transactions are made.
Each reason code has a default account and subaccount specified, and they are used as the offset account and subaccount for the inventory transaction.
You can specify reason codes for inventory receipts, issues, and adjustments.