Inventory Accounting

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To view IFS IDEAS Report Wizard Documentation, please see General Ledger Document.

Inventory Accounting Overview

The Inventory Accounting (IA) module provides IFS IDEAS with the capability of accounting for the receipt, storage, and issue of items held as inventory.  Inventory Accounting provides a dual-currency valuation capable of managing multi-currency transactions and comprehensive reporting to address inventory accounting requirements.  The Warehouse (WH) module interfaces with Inventory Accounting to provide the vehicle for physical tracking.  The Purchase Requisition (PR) module and the Purchase Document (PD) module enable monitoring of acquisition requirements for both quantity and value.  Transactions initiated in the Warehouse and Purchase Document modules are processed and recorded in the General Ledger (GL) by the Inventory Accounting module.  The Accounts Payable (AP) module provides the requisite interface with the Purchase Document module to allow finalization of pricing using a vendor’s invoice.  Together, these modules form a cohesive unit to record and report the movement and value of inventory.

Inventory Accounting utilizes Purchase Documents, the purchase order entry system, to monitor the quantity of items that have been ordered but not received.  The purchase document is also used to accumulate cost.  Multiple valuation methods including actual cost, average cost, and standard cost provide valuation of additional acquisitions.  Final valuation occurs when the purchase document is closed.

Inventory Accounting supports tracking capital and expense items by utilizing code designations established at the time a new inventory item is set up in Purchase Documents.  Inventory is classified as either “owned” or “leased.” Inventory designated “leased” may be tracked, but it does not maintain value.  Inventory designated “owned” which is not capitalized (e.g., expense items) is valued for each receipt and issue.  Acquisitions that are capitalized are not valued and tracked after a purchase document is closed.  Third-party leased equipment can be tracked through the Warehouse module.

This section of the user manual is devoted to providing a user perspective of the capabilities of the IFS IDEAS Inventory Accounting (IA) module and how it can be designed to meet the needs of the user.  This overview is intended for use in conjunction with the user manual instructions.  More important, it is intended to be a narrative that permits the user to understand how the system is set up and what it is to accomplish once it is in full operation.

The primary objectives of the Inventory Accounting module are to:

The Inventory Accounting module is designed to automate the journal recording process and produce Inventory Valuation Reports that agree with the journal entries produced.  The result is to improve the accuracy of accounting and to reduce the cost of operation.

A brief narrative follows about the basics IFS IDEAS employs for the Inventory Accounting module and its interaction with other IFS IDEAS modules.  Further discussion covers various functions within the module.

The IFS IDEAS Inventory system consists of four modules:

Purchase Documents (PD), Purchase Requisitions (RQ) – Optional, Warehouse (WH), and Inventory Accounting (IA).  These modules are responsible for:

• PD - The creation and maintenance of purchase documents.  It is also the hub of the inventory system and where all tables and most master files are created and maintained.

• RQ - The creation of purchase requisitions.

• WH - Stock transactions include issues, receipts, returns, and adjustments.

• IA - The updating of financials with stock transaction information.

Modules to Set Up Before Inventory Accounting

IFS IDEAS requires that you set up the General Ledger and the Purchase Documents modules before you can define the Inventory Accounting module.

System Setup Procedures

To set up IFS IDEAS to operate the Inventory Accounting module, complete the following steps in the order listed below.  Each step requires that you click on an icon (or select a function from the Functions drop-down menu) and complete the screen(s) that IFS IDEAS displays.  Please see the next section, Screen-by-Screen Instructions, for detailed instructions on how to complete each screen.

Screen-by-Screen Instructions

The Inventory Accounting module offers functions to support the activities required to value, account for, and reconcile inventory.  There are several ways to access a function. IFS IDEAS organizes functions into drop-down menus.  Click once on a menu name to get the drop-down menu from which you can select a function.

Please see the Screen-by-Screen Instructions supplied for each screen for detailed instructions on how to complete each screen.  These instructions are in the sections that follow immediately.

Toolbar buttons at the top of the Reconcile Account screens allow you to perform certain actions:

• Exit Screen – Click on this button to exit without saving changes.

• Help! – Click on this button to access Reconcile Account help screens.

• Create new row – Click on this button to start specifying criteria for a new tax authority.

• Save Data – Click on this button to save. 

• Print Preview – Click on this button to preview a report.  Then you may click on other buttons, located on the Print Preview toolbar, to do the following:

  • Move from page to page of the report.

  • Change the zoom control.

  • Print the report.

  • Export the report to a file or other destination.

• Delete Row – Click on this button to delete a row.  

Note: When you click on the Delete Row button, the system displays the message, “Are you sure you want to delete?”  If you click on OK, the system permanently deletes that record.

Highlights

• Multiple entities (companies) and warehouses on a single system may be maintained simultaneously.

• Stock transactions may target accounts specified by up to three levels of stock segregation.

• Inventory costs are maintained by entity, by warehouse, and by stock condition code.

• Inventory may be easily transferred from one warehouse to another within an entity.

• An Inventory Valuation report is provided. It includes valuation for Priced Inventory, Accrued Inventory, Materials in Transit, and Unpriced Inventory.

• Stock items may be ordered, received, and issued using two different units of measure.

• Bills of Material are provided to reduce entry during stock transactions and order entry.

• Orders may be created in multiple currencies.

• Stock item values may be tracked in two currencies.

• The procurement system provides three levels: 

  • Material Requisitions

  • Purchase Requisitions

  • Purchase Documents

• Orders may be created for both stock and non-stock items.

Export to Excel Feature

Some screens in this module may have an Export to Excel  button incorporated in the screen or an Export to Excel  icon in the toolbar.  The user can click on this button or icon to export the raw report data directly to an Excel spreadsheet, bypassing the report.  This feature is useful as it allows clients to use Excel features (for example, pivot tables, etc.) to organize the data as desired.

Process Flow

SYSTEM FLOW CHART

Open

Create Material Requisitions – Material Requisitions (MRs) are used to request that material be issued from a warehouse. The material requisition is electronically transferred to the warehouse responsible for the issue of stock.  If the requested item is in stock, it will be issued.  If it is not on hand, a purchase requisition or purchase order may be created.

Create Purchase Requisitions – Purchase Requisitions (PRs) are used to request that items be purchased, generally due to an out of stock or stock shortage. Purchase Requisitions are forwarded to the procurement staff for resolution.

Create Purchase Documents – Purchase Documents (PDs) are the documents provided to a selected supplier through which goods are ordered.  Purchase Documents are also used within IFS IDEAS for goods receipt and invoice processing.

Receive Orders – Receipts relieve items from purchase documents and update inventory quantities.

Enter Invoices – Before a purchase document may be closed, it must be invoiced and journalized.  An invoice may be entered before the item is received, but the purchase document must exist.

Close Purchase Documents – Once a line of a purchase document has been received and invoiced, it must be closed and processed to calculate priced inventory.

Issue, Return, Transfer Inventory – These are the basic warehouse transaction types.  In order for these transactions to be properly accounted for, they must be processed and journalized through Inventory Accounting.

Initial Setup Process

Create and Cross-Reference Chartmaster – The Inventory Accounts must be defined in GL Element Maintenance in order to reference them during Inventory Accounting setup.

Create Tables – Create all tables in the Purchase Documents Constants Setup submenu under the Utilities menu in the PD module. These tables include condition codes, stock types, and general codes (locations, categories, groups, etc.).  PD clauses and ship-to tables are optional and only need to be entered if these options will be used in PD entry.

Establish Entities – Before any inventory may be assigned to an entity, it must first exist and be established in GL Element Maintenance.

Populate Master Files – Create your Stock Master catalog, Bills of Materials and establish any beginning quantities on hand through Beginning Stock Setup.

Define System Parameters – Define Purchasing Parameters through the PD Utilities menu and by clicking on the Purchasing Parameter Setup submenu. In the Inventory Accounting module, define charge accounts and system accounts by clicking on the Inventory Accounts Setup and Inventory System Accounts Setup submenu under the Utilities menu.  Set up journals.  Set up minimum and maximum quantities as well as sub-locations for warehouse locations.         

Set Up System Security Module – Define access rights to all users on the system. 

Interfacing with Other Modules

Inventory Accounting coordinates the merging of financial data from the Purchase Document module with the physical data from the Warehouse module.  This is accomplished by executing Inventory Accounting functions related to the specific modules.  An example would be to run Process Closed Purchase Documents Lines and then run Process Warehouse Transactions under the Transaction Processing menu.  Historical financial data may already be attached to Warehouse module transactions at the time they are processed, but Inventory Accounting considers new costs from Purchase Documents to identify necessary adjustments before finalizing inventory values.  This means that temporary values are used at various stages during the cost-assignment cycle.  Invoiced cost for new items is passed from Accounts Payable to Purchase Documents and is used in the final determination of cost valuation.

As functions are executed in Inventory Accounting, journal entries are created.  The journal entries are recorded in the general ledger when the user executes the various journal processing functions in the General Ledger module.

Basic Inventory Accounting

The IFS IDEAS Inventory Accounting module is designed to produce accounting for inventory transactions in a manner prescribed by the users’ setup procedure, as well as the internal processes of the software.  How the module manipulates accruals, costs, and valuations will be the next focus of this discussion.

Accruals

Inventory Accounting produces a temporary accrual for the value of new stock received by the Warehouse module that has not been invoiced against an open purchase order in the Purchase Document module.  It also produces a temporary accrual for the value of new stock when the Accounts Payable module processes an invoice in conjunction with a Purchase Document prior to receipt by the Warehouse module.  Inventory Accounting uses the purchase order unit price as the basis for valuing an accrual.  The accrual will be reversed, in whole or in part, on the basis of the number of units, which are subsequently invoiced and processed through the Accounts Payable module.  Inventory Accounting creates a multi-purpose entry charging the appropriate inventory account, crediting the offset designated in Accounts Payable for the vendor, and reversing the accrual entry.

Actual Cost

Inventory Accounting is designed to retain the value of inventory using one of several methods based on the actual cost processed through Accounts Payable, or as assigned manually by the user.  The module maintains System Average Price (SAP), standard price, or actual price.

SAP is based on creating a common pool of value where the average unit value is the system price.  Any new stock receipts into the pool will alter the average price, as will an inventory value adjustment.  The system of pricing ignores the separate billed price of each unit contained within the pool in favor of the average overall price.

Standard price is common in manufacturing operations where it is necessary to charge a process operation a previously assigned standard unit price for all materials provided to that process.  This methodology will usually lead to a profit or loss to the issuing warehouse since the cost basis of the issuing warehouse may be different from the cost charged to the receiving location.

Actual price is used with specific stock items as opposed to pooled stock items.  Generally speaking, a specific stock item will be controlled by a serial number.  The actual price method enables the actual invoiced cost to follow the specific stock item.  Any receiving site will be charged the actual invoiced cost.

Temporary vs. Permanent Cost Valuation

Inventory Accounting produces journal entries that can be based on either permanent or provisional unit pricing.  Permanent prices can be immediately created by using Beginning Stock Setup, closing and processing a line in a purchase order, or by receiving a stock item through transfer.  Permanently priced stock will be the first stock to be issued from a warehouse.

The temporary (or provisional) price is established in Stock Master Maintenance.  If a permanent unit price is unavailable, the module will revert to the estimated price.  Any entries based on the estimated price will later be subject to an automatic cost adjustment when the module ascertains the permanent price.  Internal system codes maintain the status of temporary versus permanent unit price assumptions.

A Look at the Inventory Accounting Utilities

• Accounting Period Control Dates

• Beginning Stock Setup

• Non-Purchase Accounts Setup

• Entity Parameters Setup

• Inventory Accounts Setup

• Inventory System Accounts Setup

• Miscellaneous Setup

Inventory Accounts Setup

To access this function, select the Inventory Accounts Setup submenu under the Utilities menu.

Each location intended for inventory activity must be identified in Inventory System Accounts Setup before being set up in this function.

Inventory Accounts Setup enables the user to establish any desired number of companies for which inventory will maintained.  Each company is, of course, identified by its respective entity code.

Every location involved as a warehouse, well-site, or other receiving location must be recognized in Inventory Accounts Setup.  This provides the mechanism by which Inventory Accounting tracks movement from one location to the next.

Stock type is the key to how Inventory Accounting will ultimately account for a stock item.  It indicates the relationship of the stock to the user, for example, whether it is expensed or capitalized, and whether it is owned or not.

Each stock type should have an associated fully qualified account (FQA).  This enables the user to lump different forms of stock into a single financial category or assign individual accounts to each type.  For instance, tubulars such as casing and tubing may fall under a single stock type and be recorded in a single FQA.  An alternative would be to create respective stock types for casing and tubing and assign separate FQAs.  Hence, the more stock types with specific FQAs, the greater the financial detail.

Inventory System Accounts Setup

Each location intended for inventory activity must be identified in this function before being set up in Inventory Accounts Setup.

The Inventory System Accounts Setup enables default FQAs to be established for each location.  Special attention should be given when assigning the FQAs so that the possibility of errors will be minimized when processing takes place.

There is a distinction to be drawn between warehouse and non-warehouse locations.  Inventory Accounting will actively use the FQAs designated here for the warehouse locations.  Non-warehouse locations are not linked to these FQAs, so they may be arbitrarily filled.

• The cash account is linked to sales transaction entry.  The user may designate a receivable FQA if sales to third parties are typically a debit to A/R.

• The gain/loss account will collect any profit or loss occurring from a sale of inventory.

• Any manual adjustments are recorded in the inventory adjustment account.

• The fixed asset account is for stock items identified as capital/owned.  Additional specific accounts can be designated in Inventory Account Setup.

• The material-in-transit account has two purposes.  The first is to record inventory that has not been received but has been invoiced.  The second purpose is a clearing account for stock transferred from one warehouse to another.  The account used should be exactly the same for each warehouse to allow a zero balance effect in the general ledger.

• The accrued asset and accrued liability accounts are temporary accounts that allow processing of inventory received by the Warehouse module when no accounts payable activity has been recognized by Purchase Documents.

Beginning Stock Setup

This function is intended to accommodate the commencement of a new system.  Stock quantities and unit prices can be directly entered, which bypasses the Purchase Documents and Warehouse modules. It is recommended that the opening position be thoroughly documented prior to processing any subsequent transactions.  An inventory valuation report providing the opening position and aggregate value should tie to the general ledger.  All items entered here are permanently priced until subsequent receipts are acknowledged through the other modules.

No audit trail exists when using this function (e.g., no detail listing).  In order to accumulate this type of detail, use the Quantity Adjustment function instead.  Depending on the volume of detail a user chooses to enter for each stock item, using Quantity Adjustment could create rather large history files.

Entity Parameters Setup

Warehouse Journals

Journals must be defined for Inventory Accounting to accomplish its tasks.  It is highly recommended that individual journals be established which will allow the user to identify the general types of inventory activity found in this function.

Further elaboration on setup can be found in the procedures for this function.

The key to journal setup is the user’s requirements for maintaining separate currency records.  The use of multi-currencies makes journal setup more complex.  Therefore, the user should take ample time when deciding on the number of journals required to provide complete and accurate records and audit trails.

Dual Currency Parameters Maintenance

This function allows Inventory Accounting to interact with the Currency Conversion module using the currencies the user chooses to track inventory.

A Look at Inventory Accounting Transaction Processing

• Inventory Sales Price Entry

• Returns Price and Exchange Rate Entry

• Inventory Value Adjustments

• Process Closed Purchase Documents Lines

• Process Warehouse Receipts and Vendor Returns

• Process and Journalize Warehouse Accruals

• Process Warehouse Transactions

Process Warehouse Transactions

Processing rolls up all transactions placed in the stock transaction file since processing last occurred.  Each stock item has a stock master record that contains the stock type.  The stock type is linked to the FQA.  The unit value and the FQA are attached to the stock item.  The system checks for a permanent price to attach to the item.  Should one not be found, it reverts to the estimated price defined in the stock master record.

There is a Processed Warehouse Transactions Recap to identify whether transactions were successfully processed.  Transactions not processed will be listed in a separate section of the report.

Processing can be thought of as “cementing” the transaction in this function.  Once processing has taken place, a warehouse has no further opportunity to edit or delete a transaction using the system-assigned transaction number.  For example, a user in a warehouse cannot recall a transaction through the Receipt or Issue Maintenance screen once processing has occurred.  For this reason, it is important that the user check all inventory transactions for accuracy.  Data entry cutoff and process scheduling should be coordinated so that quantity and value integrity can be maintained.

Process Closed Purchase Documents Lines

It is important to promptly close and process purchase document lines.  Inventory Accounting uses a temporary price for new stock until a permanent price is calculated during execution of this function.  The Accounts Payable module interacts with the Purchase Document module transmitting invoiced quantities and values.  The unit price is determined when Purchase Document lines are rolled into a stock items’ transaction history.  Journal entries are created during execution of this function when a permanent price differs from the temporary price.

Inventory Sales Price Entry

This function enables a user to record a sales price for a stock item.  Inventory Accounting will calculate a profit or loss on the stock item based on the cost method chosen for the item.  After filing the data, a three-line transaction will be produced effecting inventory, gain/loss, and cash (or receivable).  A sale transaction must have been entered in the Warehouse module prior to entering the sales price data here.  This function requires a system-generated transaction number from the Warehouse module.

Inventory Value Adjustments

Value adjustment can be a valuable correction tool.  Essentially, two FQAs will be effected, the warehouse and write-down accounts.  An error originating in Accounts Payable that was passed through Purchase Documents is a prime example of the need for this function.  A manual calculation is required to provide the necessary adjustment to reach the desired balance.  A journal entry is created after filing this process.

A Look at Inventory Accounting Journalization

• Journalize Warehouse Receipts

• Journalize Warehouse Transactions

• Accounting Valuation Worksheet Report

• Accounting Valuation Entry

Accounting Valuation Worksheet Report

This report is used for pre-screening the warehouse journal entries created, but not journalized.  The report provides validation of FQAs.  It basically replicates what will be provided in the Warehouse Transaction Journalization Recap report.  Accordingly, if an error is detected, the user can refrain from journalizing the entry and proceed with establishing a means of correction.

Accounting Valuation Entry

The journal activity created by processing can be seen online immediately after processing.  The user must have the location and system-assigned transaction number. 

This function allows the user to edit non-inventory related FQAs if necessary.  For example, if the user has second thoughts about the account that was used to record adjustments, the FQA can be edited here and the transaction re-filed.

Inventory related FQAs couldn’t be edited.  Any attempt to change an inventory account would produce an imbalance between the Inventory Accounting stock quantities and values, and the automated journal entries affecting the general ledger.  If the user attempts to edit an entry through the General Ledger, special precautions must be considered to maintain the integrity between Inventory Accounting and the General Ledger. 

Journalize Warehouse Transactions

This function attaches a processed warehouse transaction to a journal and system-generated batch number.  A Journal Entry Audit List is produced which lists the journal, batch numbers, and summary entries for all transactions journalized in the batch.  The Warehouse Transaction Journalization Recap is also produced.  It provides a detailed listing of each journal entry.  Also produced is the Dual Currency Conversion Report.  It lists the transactions in the source currency, converted currency, and the general ledger account balances.

A Look at Inventory Accounting Reports

• Accrued Warehouse Movement Report

• Inventory Activity Report

• Inventory Activity Report by Destination

• Costs Pending Allocation Report

• Inventory Transaction Listing

• Inventory Valuation Reports

• Inventory Value Adjustments Log

• Item Ledger Report

Inventory Valuation Reports

This report is the principal reconciliation tool for ensuring that the aggregate value of stock in inventory is in agreement with the general ledger.  Up to as many as four reports may be generated depending on the status of stock.

It is recommended that all transactions filed in Inventory Accounting be processed and journalized at the close of the fiscal period prior to attempting to reconcile the valuation reports to the general ledger.

Item Ledger Report

This report provides the extended value of permanently priced stock.  The pricing status (priced vs. non-priced) will also be shown.

Other Inventory Reports:

• Materials-in-Transit Report - This report lists stock that has been processed by Accounts Payable, but has not been received through the Warehouse module.

• Accrued Valuation Report - This report lists stock that has been received by the Warehouse module but has not been processed by Accounts Payable.

• Unpriced Inventory Transaction Report - This report lists the value of stock that has been received through the Warehouse module and processed by Accounts Payable, but it has not been closed and processed in Inventory Accounting.  Items are removed from this report as Purchase Document lines are closed and processed.

Inventory Accounting Module Main Screen

Functions in the Inventory Accounting module may be accessed through the drop-down menus or by using buttons.

After you log into the Inventory Accounting module:

• Click once on a button to load a function, or

• Select a function from one of the drop-down menus. 

Open

Transaction Processing Menu

Transaction Processing Drop-Down Menu Overview

This menu is used to access the programs that are necessary to maintain the inventory accounting function through the processing of closed purchase documents, entry of sales prices, value adjustments, and processing of warehouse transactions.

Transaction Processing Drop-Down Menu – Main Screen

Transaction Processing functions on the drop-down menu allow users to perform the following:

• enter sales prices

• input Inventory Value Adjustments

• enter warehouse return prices and exchange rates

• Process Closed Purchase Documents Lines

• Process Warehouse Transactions

• accrue estimated values for un-priced warehouse movements.

Click on the Transactions Processing menu button to receive the drop-down list containing all of the particular functions for this menu.

 Functions on the drop-down menu include:

• Inventory Sales Price Entry

• Returns Price and Exchange Rate Entry

• Inventory Value Adjustments

• Process Closed Purchase Documents Lines

• Process Warehouse Receipts and Vendor Returns

• Process and Journalize Warehouse Accruals

• Process Warehouse Transactions

Following are screen-by-screen descriptions of how to use each function.

Inventory Sales Price Entry

The Inventory Sales Price Entry screen is used to input the actual value received for inventory stock items that are sold.  The sales price received per unit is entered, and the system records the sale and the inventory gain/loss using the item’s book value.  This sales value must be input for each sales transaction before Process Warehouse Transactions can process the sales transaction.

Processing the Inventory Sales Price Entry Screen

Select Inventory Sales Price Entry from the Transaction Processing drop-down menu.

Open

• Company – Select the company or entity from where the sales transaction took place.

• Location – Select the warehouse location that created the sales transaction.

• Transaction Number – Select the existing transaction number.  A list of transaction numbers will appear in the list in the popup window that appears once you select the search icon.  The first sales transaction the system finds for the entity/location will be displayed.

The following information will automatically be displayed by the system:

• Sales Date – Date of the sale.

• Stock Number – Stock number of the item sold.

• Condition Code – Condition code of item sold.

• Reference Number – Reference number associated with the sales transaction.

• Sold To – Name of purchaser.

• Comment – Enter a comment, if any, related to this transaction

• Primary Quantity – Quantity of items sold.

• Primary UOM – Unit of measure used.

• Sales Price Per Unit – Enter the sales price per unit sold.  

• Total Sales Amount – The Total Sales Amount prompt will be populated if the Sales Price/Unit prompt is input.  You have the option to input the total value of the sale in this prompt, including a zero value.
  
  
  

Returns Price and Exchange Rate Entry

The Returns Price and Exchange Rate Entry screen is used to adjust the price and exchange rate for inventory returns.  These values must be input for return transactions before Process Warehouse Transactions has been executed.

Processing the Returns Price and Exchange Rate Entry Screen

Select Returns Price and Exchange Rate Entry from the Transaction Processing drop-down menu.

• Company – Select the company or entity from where the sales transaction took place.

• Location – Select the warehouse location that created the sales transaction.

• Transaction Number – This is the existing transaction number for the Return. 

The user would enter an existing “unprocessed” return transaction number or select from list.  The user cannot enter a new transaction number.

• Transaction Date – Date of transaction.  Displayed from selected transaction, cannot be edited.

• Reference Number – Reference from transaction.  Displayed from selected transaction, cannot be edited.

• Return From – Return from Location.  Displayed from selected transaction, cannot be edited.

• Stock Number – Stock number for return. Displayed from selected transaction, cannot be edited.

• Description – Description of stock items.  Displayed from selected transaction, cannot be edited.

• Condition Code – Condition code for stock item.  Displayed from selected transaction, cannot be edited.

• Primary Quantity – Primary quantity returned to stock. Displayed from selected transaction, cannot be edited.

• Primary UOM – Primary Unit of Measure for return.  Displayed from selected transaction, cannot be edited.

• Secondary Quantity – Optional Secondary quantity returned to stock. Displayed from selected transaction, cannot be edited.

• Secondary UOM – Secondary Unit of Measure for return.  Displayed from selected transaction, cannot be edited.

• Return Price – User should enter the unit price returned for the stock items.  “Optional.”

• Historical Rate – User should enter the historical exchange rate for the returned stock items.  “Optional.”

Inventory Value Adjustments

The Inventory Value Adjustments screen is used record Inventory Value Adjustments.  Enter either the adjustment value or the final adjusted value and the system will compute the other field.  Any use of this screen will automatically be logged to a special adjustment file with the transaction and associated user ID.  This log may be reviewed for security use by requesting the Inventory Value Adjustments Log.

The system automatically displays New in the Transaction Number field.  A transaction number is generated at the time the transaction is filed that is identified in the message bar at the bottom of the screen.

A Journal Entry Audit List is produced as a result of processing these adjustments.  The appropriate inventory account is debited for an increase in value and credited for a decrease in value.  The inventory accounts are set up for each stock type by company and location on the Inventory Account Set Up screen.  The adjustment account is debited for a decrease in value or credited for an increase in value.  This account is set up by the user in the System Account Set Up. A dual-currency conversion report is also produced.

Open

• Company – Select the company or entity where the item resides.

• Location – Select the location of the item.

• Transaction Number – Select an existing transaction number or a New one.  The system automatically offers New as an option.  After filing the transaction, the system generates a transaction number and displays it in the message bar at the bottom of the screen.

• Stock Number – Enter the stock number you wish to adjust.  Once you select the search icon, a popup screen will appear prompting you for information. Enter the appropriate information.  If the stock type is capital and/or leased, no adjustment can be made.

Open

• Condition Code – Select the condition code of the item.

• Current Stock on Hand Information – This information will appear automatically in the fields listed: Priced primary quantity, Priced secondary quantity, Currency 1 Balance, Current SAP, Primary Unit of Measure, Secondary Unit of Measure, Currency 2 balance.

  • Adjustment Code – Select an Adjustment Code from the drop-down list.  The Adjustment Code describes the reason the value adjustment is being made.

• Exchange Rate Type – Choose an option for the method of exchange rate determination for the dual-currency valuation. 

• Transaction Date – If the Rate Table option was entered in Exchange Rate Type, enter a date for the transaction (the conversion date).

• Exchange Rate – If the Historical Rate option was entered in Exchange Rate Type, enter the historical exchange rate to be used.

• Value Adjustment – Enter the amount of the value adjustment in the Currency 1 text box.  The related Currency 2 adjustment will be calculated using the Rate Option selected.

• Adjusted Value – The adjusted value that will replace the current value is displayed.

• Comments – Enter comments, if any, related to this transaction.

• Reference – The reference number identifies the purpose of value adjustment where the user can enter some reference text. If blank, it will assign the transaction number and transaction type reference.

• ALT Comments – Enter comments, other than those entered in the comments field.

Process Closed Purchase Documents Lines

The Process Closed Purchase Documents Lines screen is used to process all newly closed Purchase Documents items in a batch mode.  After the purchase order line items have been set to closed, the Process Closed Purchase Documents Lines process can be run.

When an item is initially received into inventory, it is said to be “un-priced.”  This simply means that the Close Purchase Document Lines function has not finalized a value for the stock item.  Outstanding purchase documents with line items that have been processed through the Accounts Payable module as required may qualify for final valuation.  In the interim, IA relies on the stock item’s estimated price, stipulated in Stock Master Maintenance in the Purchase Document module, in order to provisionally value transactions.

The ability to close a purchase document line in Purchase Document Entry signifies that all cost associated with the line has been invoiced through Accounts Payable.  After running Process Warehouse Transactions, this function utilizes the cost method chosen in Stock Master Maintenance of the PD module to calculate a value for each item, flag the item as “priced,” and assign a value to each warehouse transaction.

A report is generated that recaps the items processed and, if applicable, a report is generated reflecting all adjusting journal entries created during final valuation.

For valuation purposes, Process Warehouse Transactions uses a “priced” item first.  If no “priced” item is available, the system reverts to using an “un-priced” item at the estimated price.  If a previously used “un-priced” item qualifies to be “priced,” this function will calculate the final value and generate an adjusting entry for the difference, if any, between the estimated price and the value calculated using the cost method chosen for the stock item.

Processing the Process Closed Purchase Documents Lines Screen

Select Process Closed Purchase Documents Lines from the Transaction Processing drop-down menu.

Open

• Company – Select the company or entity for which the closed purchase documents are to be processed.

• Transaction Date – Select All Dates to process closed purchase documents lines for all available dates, or select Through Date to specify an ending date for the closed purchase documents lines to be processed.

Process and Journalize Warehouse Accruals

The Process and Journalize Warehouse Accruals is a process to calculate and journalize stock transactions that cannot be priced from values in the transaction record.  If a stock transaction must be accrued, it is accrued at the SAP in the Stock on Hand record or the estimated price in the stock master, if SAP does not exist.  Only primary warehouse currency amounts are updated for accruals.  The journals are flagged to convert if dual-currency inventory is true.  The GL posting process will create the converted secondary warehouse journal.  For Accrued Transactions that have finally been priced, this process will reverse the original accrual. 

Transaction types processed by this program are shown in the table below.

Processing the Process and Journalize Warehouse Accruals Screen

Select Process and Journalize Warehouse Accruals from the Transaction Processing drop-down menu.

Open

• Company – Select the company or entity for which the accruals are to be processed.

• Transaction Date – Select All Dates to process and journalize accruals for all available dates, or select Through Date to specify an ending date for the accruals to be processed.
  
  
  

Process Warehouse Receipts and Vendor Returns

The objective of the Process Warehouse Receipts and Vendor Returns process is to determine if a warehouse receipt, against a stock Purchase Order line, should be accrued.  If the quantity received at the warehouse has already been covered by quantity invoiced and journalized, then the warehouse transaction is flagged as complete and no further action is taken on the receipt.  If the quantity received has not been invoiced, then the receipt will be valued at the PO unit price in the currency of the PO.  The “Unit Price” on the PO will be in the purchase units of the PO, not the control units.  So to accurately value the receipt quantity, the PO Unit Price must be converted to the unit price of the control units to calculate the accrual amount.  There may also be situations where receipts are partially offset by invoiced quantities, so the quantity accrued may be less than the quantity received.

The Accrual Process will create only source accrual journals.  These Journals are designed to convert to Inventory currencies if necessary in the General Ledger and Currency Conversion modules.

When invoices are subsequently received for quantities that offset receipts that have been previously accrued, then the AP Journalization process will for reverse receipts that have been previously accrued.  These reversals will be by each receipt transaction so the reversal will match the original receipt date that was used to convert the original accrual.

Processing the Process Warehouse Receipts and Vendor Returns

Select Process Warehouse Receipts and Vendor Returns from the Transaction Processing drop-down menu.

Open

• Company – Select the company or entity for which the receipts are to be processed, or check the All box to process all entities’ receipts.

• Transaction Date – Select All Dates to process receipts for all available dates, or select Through Date to specify an ending date for the receipts to be processed.

Process Warehouse Transactions

The Process Warehouse Transactions screen is used to execute the batch processing of all warehouse transactions.  Inventory quantities and values are updated for each stock item issued, returned, transferred, or adjusted.  An inventory value for each transaction is calculated and stored for journalization.  The System Average Price is recalculated for return transactions and transfer receipts transactions.  

If no “priced” items were available for an issue type transaction, the estimated cost is used for valuation purposes (i.e., issues, transfer issues, sales).  When the related purchase order item is closed and processed, a system-generated adjusting entry will be made to correct the difference between the estimated and actual price.  A Process Warehouse Transaction Recap report is created as a result of this process.

The following chart explains the journal entry and valuation method used given the type of transaction and the costing method associated with the stock item.

The Process Warehouse Transactions purpose is to price the various types of warehouse movements and adjustments and assign the FQA account coding so the transaction can be journalized.  If there are priced units on hand, and in sufficient quantity to price all the quantity on the transaction, then this program will use the current “System Average Price” (SAP) of the Stock on Hand record to value the transaction.  In a dual-currency inventory system, both inventory currency 1 and 2 values will be calculated.  The current quantity of “Priced Quantity on Hand” will be reduced by the transaction if the transaction type reduces physical stock on hand.  The current quantity of “Priced Quantity on Hand” will be increased by the transaction if the transaction type increases physical stock on hand.  The value of stock on hand will decrease or increase just as the quantity will increase or decrease by transaction type.  Issues, Transfer Issues, Sales, Transfer Disassembly, Assembly Parts, and Negative Quantity Adjustments will reduce the priced quantities and values of stock on hand.  Returns, Transfer Receipts, Transfer Assembly, Disassembly Parts, and Positive Quantity Adjustments will increase the priced quantities and values of stock on hand. 

Order of Processing :  Issue-type transactions will be processed in order of transaction date to ensure items moved out of stock first are priced first.  Returns and positive Quantity Adjustments will always be priced.  Transfer Receipts will be priced if the corresponding Transfer Issue is priced. 

Exceptions :  If a transaction cannot be priced because there are insufficient priced quantities on hand, then all further processing will be skipped for the Entity / Location / Stock No. / Bill code combination even if there is sufficient priced quantity on hand to price smaller quantity movements. 

COSTING METHOD BY TRANSACTION

The valuation methods that are in parentheses are the secondary valuation methods used if the first value is not available due to having no “price” inventory on hand.  Standard and estimated prices are those that are on stock item records.  Actual and System Average Price are based on the invoice price and can be utilized by the system once the Purchase Document is closed.  For inventory values using standard or estimated price, the transaction value is calculated by multiplying units by the price times the condition code percentage.  For transactions where estimated value was used as the secondary method, an adjustment to the primary method is made based on the actual price when the Purchase Document is closed.

Processing the Process Warehouse Transactions Screen

Select Process Warehouse Transactions from the Transaction Processing drop-down menu.

Open

• Company – Select the company or entity for which the transactions are to be processed.

• Transaction Date – Select All Dates to process transactions for all available dates, or select Through Date to specify an ending date for the transactions to be processed.

• Break Page on Status – Check this box in order to obtain a page break between each status on the Process Warehouse Transactions Report.

Journalization Drop-Down Menu Overview

The Journalization drop-down menu provides the options needed to complete, review, and journalize the results of inventory activity.

Journalization Drop-Down Menu – Main Screen

The Journalization functions allow you to perform Inventory Accounting Journalization processes, print preliminary account specifications worksheet, and edit the account specifications on warehouse transactions.

• Journalize Warehouse Receipts

• Journalize Warehouse Transactions

• Accounting Valuation Worksheet Report

• Accounting Valuation Entry

Click on the Journalization menu button to receive the drop-down list containing all of the particular functions for this menu.

Journalize Warehouse Receipts

Journalize Warehouse Receipts performs the journalization process for Receipt warehouse transactions for quantities received that have not been previously invoiced.  The transaction will be recorded in the Purchase Order currency and matched to the appropriate source journal.   Only Receipts (R) transaction types are journalized by this program.

Processing the Journalize Warehouse Receipts Screen

Select Journalize Warehouse Receipts from the Journalization drop-down menu.

Open

• Company – Select the company or entity for which the transactions are to be processed.

• Journal Period – Enter the accounting period in which the journal entries will be recorded on the General Ledger.

• Journal Year – Enter the accounting year in which the journal entries will be recorded on the General Ledger.

Journalize Warehouse Transactions

This screen is used to generate a journal voucher for all transactions other than Receipt transactions.  The Journalize Warehouse Transactions program will perform the journalization process for warehouse transactions that have been processed by the Process Warehouse Transactions program.  In a dual-currency system, the process will create journals in both the primary and secondary warehouse currencies.  A single currency system will journalize only in the primary warehouse currency.  Receipt (R) transaction types are not processed by this program.            

Transaction types selected for processing by this program are shown in the table below.

A Journal Voucher Audit List report is created as a result of this process.  The report shows the summarized journal entry that will be passed to the General Ledger, as well as a detail listing by receipt/issue transaction of each journal entry created.  Only the summarized journal entry will be passed to the General Ledger.  A non-invoiced Inventory Accrual Report is also produced for expense/owned inventory.  This report shows an estimate for received inventory for which an invoice has not been received.

Processing the Journalize Warehouse Transactions Screen

 Select Journalize Warehouse Transactions from the Journalization drop-down menu.

Open

• Company – Select the company or entity for which the transactions are to be processed.

• Journal Period – Enter the accounting period in which the journal entries will be recorded on the General Ledger.

• Journal Year – Enter the accounting year in which the journal entries will be recorded on the General Ledger.

Accounting Valuation Worksheet Report

This form is used to print the Accounting Valuation Worksheet Report.  The report lists all warehouse transactions that are available to be journalized and valued as a result of processing warehouse transactions.  The report displays the journal entries that will be created for each warehouse transaction.  Each journal entry line is validated and any errors in the coding are displayed.  The errors must be corrected before the entries can be processed by Journalize Warehouse Transactions.  Corrections to the accounts can be made using either the Valuation Account Specification screen or by updating the Chartmaster Element Maintenance screen in the General Ledger module. 

Processing the Accounting Valuation Worksheet Report Screen

Select Accounting Valuation Worksheet Report from the Journalization drop-down menu.

Open

• Company – Select the company or entity for which the transactions are to be processed.

• Location – Select the location where the transaction took place.  The option exists to include a specific location, a range of locations, or all locations.  Should you choose a range of locations, you must enter the beginning location and the ending location.

Accounting Valuation Entry

This form is used to make corrections to journal entries produced by warehouse transactions.  The current accounts are displayed on the screen and can be corrected.  Any invalid accounts are shown on the Valuation Accounting Worksheet.  These errors can either be corrected on this screen or by updating the Chartmaster in the General Ledger module.  The system allows corrections to be made to the following accounts:

• Expense or Capital account to or from which inventory has been issued or returned.

• Inventory Adjustment account.  

Processing the Accounting Valuation Entry Screen

Select Accounting Valuation Entry from the Journalization drop-down menu.

Open

• Company – Select the company or entity for which the transactions are to be processed.

• Location – Select the location code where the transaction took place. 

The system automatically displays the following data fields:

• Transaction Number – This is the transaction number for the stock transaction that is to be corrected.  Double click on the grid to edit the detail information.

• Transaction Type – This is the type of the transaction to be journalized (R, R, RT, I, TI, SL).

• Transaction Date – This is the date of the warehouse transaction.

• Reference Number – This is the reference number associated with the transaction.

• To/From Location – This is the to or from location.

• Stock Number – This is the stock number of the item.

• Description – This is a description of the stock item.

• Condition Code – This is the condition code of the item involved.

• Primary Quantity – This is the primary quantity of the item in the transactions.

• Primary Unit of Measure – the unit of measure in which the primary quantity is expressed.

• Secondary Quantity – This is the secondary quantity of the item in the transactions.

• Secondary Unit of Measure - The unit of measure in which the secondary quantity is expressed.

• Transaction Price – The price of the current transaction.

The line items of the journal entries are displayed for review.  Only the Fully Qualified Account elements may be modified.  All FQAs entered on the screen are validated against the Chartmaster.

Reports Drop-Down Menu Overview

The Reports drop-down menu is used to access the programs that are necessary to produce various Inventory Accounting Reports. 

Reports Drop-Down Menu – Main Screen

The Reports functions allow you to create Inventory Accounting reports. Reports on the drop-down menu include:

• Accrued Warehouse Movement Report

• Inventory Activity Report

• Inventory Activity Report by Destination

• Costs Pending Allocation Report

• Inventory Transaction Listing

• Inventory Valuation Reports

• Inventory Value Adjustments Log

• Item Ledger Report

Click on the Reports menu button to receive the drop-down list containing all the particular functions for this menu.

Accrued Warehouse Movement Report

The Accrued Warehouse Movement Report provides a list of all accrued transactions.  These transactions were created by the Process and Journalize Warehouse Accruals program. The report provides the detail of stock transactions that have been received but are not priced.

Processing the Accrued Warehouse Movement Report Screen

Select Accrued Warehouse Movement Report from the Reports drop-down menu.

Open

• Company – Select the company or entity for which the report is  to be prepared.

• Location – Select the location code for which the report is to be prepared.

• Location Status – Select whether you want to include only Active locations, only Inactive locations, or locations of either status.

• Selection Criteria – Select the criteria to be included in this report.  The options are selection by Stock Number or by Group number.

• Preview Button - Press the Preview button on the toolbar to preview the report specific to the selected options above.

Stock No Tab

Stock No Selection Option Combinations:

The Accrued Warehouse Movement Report screen for the Stock No.

Open

• Stock No – After the Stock No option button is selected, go to the Stock No options box and select the appropriate selection option.  Complete the active text boxes using the instructions that follow:

  • One or Multiple – When you select this option, complete the following active text box:

    • Stock No – Click in the text box and type in a valid stock no, then press the Tab key to move your entry to the box on the right.  Continue to enter stock no's in this manner until finished.  If you make an error, highlight the incorrect stock no, right-click, and select the delete option or highlight the incorrect stock no and press the Delete key on the keyboard.

  • Range – When you select this option, complete the following the following text boxes:

    • Start Stock – Click in the text box and type in the start stock no.  Press the Tab key to go to the Ending Stock text box.

    • Ending Stock – Type in the ending stock no.

To look up an existing  Stock No :

1. Click on the spyglass to open the Stock No search pop-up window.  You may search on Manufacturer,  Part Number, Stock Description, and/or Stock Group Code.  Use the wildcard character (*) to indicate Starts with, Ends with, or Contains text for the Manufacturer, Part Number, or Stock Description.

2. Click on the spyglass next to Group to select Stock Group.

3. Click on the execute button (!) to start the search.  The search will return a list of stock no’s from which to select.

4. Highlight a stock no, then click OK.  Or, you can double-click on the stock no.

• Options – Select the option type: One or Multiple to form a selection criteria list (1, 2, 3), Range to select by a range of values (1-3), or All to select all values for this option.

• Text Boxes – The text boxes will be available based on the selection option you choose.  For One or Multiple, you will be able to complete the top box.  Once completed, the selection will appear in the Selection Edit box.  To include additional items in the list, enter the value in the text box and press Tab. To edit your selection, highlight the selection in the edit box, and click the Delete button.  For the Range option, the Start and End boxes will be enabled.  There is no further action required if the All option is chosen.

Group No. Tab

Group No Selection Option Combinations:

The Accrued Warehouse Movement Report screen for the Group No. 

Open

• Group – After the Group option button is selected, go to the Group Options box and select the appropriate selection option.  Complete the active text boxes using the instructions that follow:

• Group No – Click in the text box and type in a valid group no.  Click on the spyglass next to select valid Group No from the list. 

• One or Multiple – When you select this option, complete the following active text box:

  • Group Code – Click in the text box and type in a valid group code, then press the Tab key to move your entry to the box on the right.  Continue to enter group codes in this manner until finished.  If you make an error, highlight the incorrect group code, right-click, and select the delete option or highlight the incorrect group code. Press the delete key on the keyboard.

• Range – When you select this option, complete the following the following text boxes:

  • Start Group Code – Click in the text box and type in the start group code.  Press the Tab key to go to the Ending Group Code text box.

  • Ending Group Code – Type in the ending group code.

To look up a Group Code:

1. Click on the spyglass to open the Group Code list pop-up window. 

2. Highlight a group code, then click OK.  Or, you can double-click on the Group Code.

• Options – Select the option type:   One or Multiple to form a selection criteria list (1,2,3),  Range to select by a range of values (1-3) or All to select all values for this option.

• Text Boxes – The text boxes will be available based on the selection option you choose.  For One or Multiple, you will be able to complete the top box.  Once completed, the selection will appear in the Selection Edit box.  To include additional items in the list, enter the value in the text box and press Tab. To edit your selection, highlight the selection in the edit box, and click the delete button.  For the Range option, the Start and End boxes will be enabled.  There is no further action required if the All option is chosen.

inventory Activity Report

The Inventory Activity Report screen is used to generate a report or multiple reports, which provide the total quantity and/or value of stock transactions by stock item or group.

Processing the Inventory Activity Report Screen

Select Inventory Activity Report from the Reports drop-down menu. 

Open

• Company – Select the company or entity code(s) for which you wish to produce the report, or select the option to report on all companies.

• Location – Select an option to specify One or Multiple locations, a Range of locations, or All locations for which the report is to be prepared, and choose the desired location(s).

• Location Status – Select whether you want to include only Active locations, only Inactive locations, or locations of either status.

• Transaction Dates - Select the option for a single specified transaction date or a range of specified transaction dates, and enter the desired date(s).

• Report Options – As the screen may produce up to 3 separate reports, you may select the specific  reports you wish to produce or use the All Reports option to produce all available reports.  The Quantity option provides the total quantity of stock transactions by stock item or group.  The Inventory Currency 1 option provides the total primary currency value of stock transactions by stock item or group.  The Inventory Currency 2 option provides the total secondary currency value of stock transactions by stock item or group. 

• Selection Criteria – As the report may be grouped by stock number or by group, you may select the desired report grouping.  In addition, you may select the option to specify one or multiple stock numbers or groups, a range of stock numbers or groups, or All stock numbers or groups for which the report is to be prepared. You can also select the desired stock number(s) or group(s).  If the Group option is selected and the All groups option is not selected, you may select the option to include any or all specified groups.

• Preview Button - Press the preview button on the toolbar to preview the report specific to the selected options above.
  
  
  
  

Inventory Activity Report by Destination

The Inventory Activity Report by Destination screen is used to generate a report showing all inventory transactions by destination.  The destination is displayed as the To location that is input on the Inventory Issues Processing screen. 

Processing the Inventory Activity Report by Destination Screen

Select Inventory Activity Report by Destination from the Reports drop-down menu. 

Open

• Company – Select the company or entity code for which you wish to produce the report.

• Location – Select the location code which the report is to be prepared.

• Options – Select the option type:   One or Multiple to form a selection criteria list (1,2,3),  Range to select by a range of values (1-3), or All to select all values for this option.

• Location Status – Select whether you want to include only Active  locations, only Inactive locations, or locations of either status.

  • Text Boxes – The text boxes will be available based on the selection option you choose.  For One or Multiple, you will be able to complete the top box.  Once completed, the selection will appear in the Selection Edit box.  To include additional items in the list, enter the value in the text box and press Tab. To edit your selection, highlight the selection in the edit box, and click the delete button.  For the Range option, the Start and End boxes will be enabled.  There is no further action require if the All option is chosen.

• Include Serial Numbers – Check this box to have serial numbers of serialized items printed on the report.

• Preview Button – Hit the preview button on the toolbar to preview the report specific to the selected options above.
  
  
  

Inventory Costs Pending Allocation Report

The Inventory Costs Pending Allocation Report provides a listing of indirect costs (Freight, Tax, etc.) that will be allocated to inventory but have not been allocated because the Purchase Document is not closed.

Processing the Inventory Costs Pending Allocation Screen

Select Costs Pending Allocation Report from the Reports drop-down menu.

Open

• Company – Select the company or entity code for which you wish to produce the report.

• Currency – Select the currency code for which you wish to produce the report.

• Location – Click in the text box and type in a valid location, then press the Tab key to move your entry to the box on the right.  Continue to enter locations in this manner until finished.  If you make an error, highlight the incorrect location code, right-click, and select the delete option or highlight the incorrect group code and press the delete key on the keyboard.

• Location Status – Select whether you want to include only Active locations, only Inactive locations, or locations of either status.

• Range – When you select this option, complete the following the following text boxes:

  • Start Location – Click in the text box and type in the start location. Press the Tab key to go to the Ending Group Code text box.

  • Ending Location – Type in the ending location.

To look up a Location:

1. Click on the spyglass to open the location list pop-up window. 

2. Highlight a location, then click OK.  Or, you can double-click on the location.

• Options – Select the option type: One or Multiple to form a selection criteria list (1,2,3),  Range to select by a range of values (1-3), or All to select all values for this option

• Text Boxes – The text boxes will be available based on the selection option you choose.  For One or Multiple, you will be able to complete the top box.  Once completed, the selection will appear in the Selection Edit box.  To include additional items in the list, enter the value in the text box and press Tab. To edit your selection, highlight the selection in the edit box, and click the delete button.  For the Range option, the Start and End boxes will be enabled.  There is no further action require if the All option is chosen.

• Charge Type – Enter or select from the drop-down list a list of Charge Types (Freight, Tax, etc.) to be included in the report.  Charge Types are defined in the PD module, under the Utilities menu.

• Document Type – Enter or select from the drop-down list a list of Document Types (PO, Contract, etc.) to be included in the report.  Document Types are defined in the PD module, under the Utilities menu.

• Preview Button – Press the Preview button on the toolbar to preview the report specific to the selected options above.
  
  
  

Inventory Transaction Listing

The Inventory Transaction Listing provides a report of activity for a selected stock item.  By default, the report is organized by stock item showing all activity for a selected transaction date.  The principal information in the report includes transaction type, date, quantity, price, and amount.  Selection criteria are available to narrow the report by type of stock, type of transaction and date.

Processing the Inventory Transaction Listing Screen

Select Inventory Transaction Listing from the Reports drop-down menu.

Open

• Company – Select the company or entity code for which you wish to produce the report.

• Location Status – Select whether you want to include only Active locations, only Inactive locations, or locations of either status.

• Location – Select the location code which the report is to be prepared.

  • Options – Select the option type: One or Multiple to form a selection criteria list (1, 2, 3), Range to select by a range of values (1-3), or All to select all values for this option.

  • Text Boxes – The text boxes will be available based on the selection option you choose.  For One or Multiple, you will be able to complete the top box.  Once completed, the selection will appear in the Selection Edit box.  To include additional items in the list, enter the value in the text box and press Tab. To edit your selection, highlight the selection in the edit box, and click the delete button.  For the Range option, the Start and End boxes will be enabled.  There is no further action required if the All option is chosen.

• Transaction Type – Select one or more transaction types from the drop-down list or mark the All check box to choose all transaction types (default).  Available transaction types include the items listed in the chart below.

• Selection Criteria – Two Selection Criteria options are available.  The first enables the report to be filtered by stock number or stock group (default).  The second provides a date filter.  You may filter by accounting period or by transaction date (default).  Chose the desired option by clicking the option button. There are four possible tabs which relate to the Selection Criteria options. They are Stock No, Group, Accounting Period, and Trans Date.  The appropriate tabs are enabled based on the options selected in the Selection Criteria frames.  The tabs provide the capability to further specify the filter criteria.  The tabs are processed as follows:

• Transaction Options – Select the option type: One or Multiple to form a selection criteria list (1, 2, 3); Range to select by a range of values (1-3). or All to select all values for this option.

• Text Boxes – The text boxes will be available based on the Selection Option you choose.  For One or Multiple, you will be able to complete the top box.  Once completed, the selection will appear in the Selection Edit box.  To include additional items in the list, enter the value in the text box and press Tab. To edit your selection, highlight the selection in the edit box, and click the delete button.  For the R ange option, the Start and End boxes will be enabled.  There is no further action require if the A ll option is chosen.

• Include Serial Numbers – Check this box to have the item serial number displayed on the report.

• Preview Button - Hit the preview button on the toolbar to preview the report specific to the selected options above.

Inventory Valuation Reports

The Inventory Valuation Reports screen is used to generate Inventory Valuation Reports showing the actual, estimated, or accrued values of inventory currently on hand.  This report can be used to reconcile the inventory values to General Ledger account balances.   Three separate reports may be produced:

• the Inventory Valuation report

• the Accrued Inventory Receipts report

• the Unpriced Inventory report

Processing the Inventory Valuation Reports Screen

Select Inventory Valuation Reports from the Reports drop-down menu.

Open

• Company – Select the company or entity where the inventory resides.

• Location Status – Select whether you want to include only Active locations, only Inactive locations, or locations of either status.

• Location – Enter the location possessing the inventory.  The option exists to select one particular location or to select a range of locations or to select all locations.  Should you select a range of locations, you must enter the beginning location and the ending location for the report.

• Report Options – There are several options on this type of report.  Select the desired option.  The choices are:

  • Inventory Valuation Report

  • Suppress Zero Balance

  • Accrued Inventory Receipts Record

  • Unpriced Inventory Report

  • All Reports

• Selection Criteria – Choose the desired criteria for this report, either by stock number or by group.  Within each of these criteria the options exist to select a particular group or stock number, a range of groups or stock numbers or all groups or stock numbers.  Should you select a range, you must enter a beginning number for the range to be included in the report and an ending range.

• Options – Select the option type:   One or Multiple to form a selection criteria list (1,2,3),  Range to select by a range of values (1-3), or All to select all values for this option

• Text Boxes – The text boxes will be available based on the selection option you choose.  For One or Multiple, you will be able to complete the top box.  Once completed, the selection will appear in the Selection Edit box.  To include additional items in the list, enter the value in the text box and press Tab. To edit your selection, highlight the selection in the edit box, and click the delete button.  For the Range option, the Start and End boxes will be enabled.  There is no further action required if the All option is chosen.

• Preview Button – Press the Preview button on the toolbar to preview the report specific to the selected options above.

Inventory Value Adjustments Log

The Inventory Value Adjustments Log screen is used to generate a report showing the value of inventory value adjustment transactions and the reason for the adjustment to the cost of the stock item.

Processing the Inventory Value Adjustments Log Screen

Select Inventory Value Adjustments Log from the Reports drop-down menu.

Open

• Company – Select the company or entity where value adjustments reside.

• Location Status – Select whether you want to include only Active locations, only Inactive locations, or locations of either status.

• Location – Enter the location to be reviewed.  The option exists to select one particular location or to select a range of locations or to select all locations.  Should you select a range of locations, you must enter the beginning location and the ending location for the report.

• Adjustment Reason Code – Enter the adjustment code to be reviewed.  The option exists to select one particular adjustment or to select a range of adjustments or to select all adjustments.  Should you select a range of adjustments, you must enter the beginning adjustment code and the ending adjustment code for the report.

• Selection Criteria – Choose the desired criteria for this report, either by accounting period or by transaction date.  Within each of these criteria the options exist to select a particular accounting period or transaction date, a range of accounting periods or transaction dates, or all accounting periods or transaction dates.  Should you select a range, you must enter a beginning number for the range to be included in the report and an ending number for the range.  If you select the report to be generated using the accounting period criterion, you must enter the accounting year.

• Preview Button – Press the Preview button on the toolbar to preview the report specific to the selected options above.

Item Ledger Report

The Item Ledger Report screen is used to generate a report that can be used to verify stock quantities and general ledger balances.

Processing the Item Ledger Report Screen

Select Item Ledger Report from the Reports drop-down menu.

Open

• Company – Select the company or entity where inventory resides. 

• Location Status – Select whether you want to include only Active locations, only Inactive locations, or locations of either status.

• Location – Enter the location to be reviewed.  The option exists to select one particular location or to select a range of locations or to select all locations.  Should you select a range of locations, you must enter the beginning location and the ending location for the report.

• Selection Criteria – Choose the desired criteria for this report, either by stock number, by group, or by accounting period.  Within each of these criteria the options exist to select a particular stock number, group, or accounting period, a range of stock numbers, groups, or accounting or all stock numbers, group, or accounting periods.  Should you select a range, you must enter a beginning number for the range to be included in the report and an ending number for the range.  If you select the report to be generated using the accounting period criterion, you must enter the accounting year.

• Reports – Choose the specific type of report you desire.  The options are: a detailed report, a summary report, or both.  The Detail report provides individual inventory stock transactions with quantity and valuation.  The Summary report provides inventory stock balances.

• Preview Button – Press the Preview button on the toolbar to preview the report specific to the selected options above.

Utilities Drop-Down Menu Overview

Utilities allows user to access the utilities and set up menu options in Inventory Accounting. 

The functions include:

• Accounting Period Control Dates

• Beginning Stock Setup

• Non-Purchase Accounts Setup

• Entity Parameters Setup

• Inventory Accounts Setup

• Inventory System Accounts Setup

• Miscellaneous Setup

Utilities Drop-Down Menu – Main Screen

This screen is used to access the programs that set up the utilities needed to operate the Inventory Accounting module.  The utilities allow you to establish the accounts and journals used to record inventory transactions on the General Ledger and to establish beginning stock balances for new locations.

Accounting Period Control Dates

 The Accounting Period Control Dates utility allows you to define the current accounting period, the beginning and ending dates for the period, and the current fiscal accounting year.  The fiscal period and year entered are used to segregate the inventory transactions according to the period in which the transactions were processed for accounting purposes.

Processing the Accounting Period Control Dates Screen

Select Accounting Period Control Dates from the Utilities drop-down menu.

Open

• Current Fiscal Period – The period number is which inventory accounting processing is currently taking place.  This will be the default period used in processing Journalization.

• Month Start Date – The date from which the Current Fiscal Period entered begins.

• Month End Date – The last in the date range that the Current Fiscal Period encompasses.

• Fiscal Year – The year in which inventory accounting processing is currently taking place. 

Beginning Stock Setup

The Beginning Stock Setup screen is used to set up the beginning stock when the Inventory Accounting system is first installed.  The stock numbers must initially be set up on the Stock Master Maintenance function under the Utilities menu in the Purchase Document module before the Beginning Stock Setup can begin.  This screen requires input of the company, location, and stock number before the entire screen is displayed.  If the stock number is a pooled item, certain screen fields are displayed, and if the stock number is a specific item, a different set of screen items is displayed.  If the Inventory Accounting system is segregated, during initial setup, flags on Inventory Accounting Configuration Setup must initially be set to integrated (I) in order to set up the beginning stock.  Once initial set up is complete, the flags can be changed to segregated (S).  The beginning stock setup data will then be exported to the various locations.

Processing the Beginning Stock Setup Screen

Select Beginning Stock Setup from the Utilities drop-down menu.

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• Company – Select the company or entity requiring balances.

• Location – Select the location requiring balances from the list that appears in the popup window once you click on the search icon.

• Stock Number – Enter the stock number requiring a balance.  Once you select the search icon, a popup screen will appear requiring information regarding the stock number.  Enter the required information.

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• Condition Code – Select a condition code that has been set up in Condition Code Setup.

• Sub-Location 1 – Enter optional Sub-Location 1 to indicate warehouse sub-location for stock.

• Sub-Location 2 – Enter optional  Sub-Location 2 to indicate warehouse sub-location for stock.

• Beginning Stock – Primary Quantity – Enter the beginning quantity of this inventory item for primary units.

• Secondary Quantity – Enter the beginning quantity of this inventory item for secondary units.

• SAP – Enter the beginning standard average price for primary units only.

• Serial Number – Enter the serial number of the item in beginning inventory.

• Historical Rate

  • Primary Currency Value – (Display only) The primary value of stock will be displayed in this prompt and is calculated as (primary qty * SAP).

  • Secondary Currency Value – In dual-currency inventory systems the user must input either the secondary currency value or the historical exchange rate needed to calculate the value.  If either value is entered, the system will be calculating the other.  Secondary Currency Value is calculated as (Primary qty * SAP * Historical Exchange Rate).

  • Historical Exchange Rate – In dual-currency inventory systems the user must the historical exchange rate needed to calculate the value.  If the value is entered, the system will calculate the other.  Secondary Currency Value is calculated as (Primary qty * SAP * Historical Exchange Rate).

Non-Purchase Accounts Setup

The Non-Purchase Accounts Setup is used to define Fully Qualified Accounts for purchasing non-PRCH  Charge Types codes.  This feature is to allow non-purchase costs to be expensed direct, instead of being included in inventory valuations.

Processing the Non-Purchase Accounts Setup Screen

Select Non-Purchase Accounts Setup from the Utilities drop-down menu.

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• Company – If there is only one company or entity defined, it will display automatically in the text box.  Otherwise, enter an entity defined for Inventory Accounting or click on the drop-down arrow and select from the list.  You may also click on the spyglass to display a popup window with value company and the company name.

• Location – Enter the location code for which you wish to set up non-purchase accounts.  Click on the drop-down list (arrow) for locations with non-purchase accounts currently defined and select from the list.  You may also click on the spyglass to display a popup window with all locations and their description.  Highlight a location, then click OK, or you can just double-click on the location.

• Charge Type – Enter the charge type code for which you wish to set up accounts.  Click on the drop-down list (arrow) for charge types with accounts currently defined and select from the list.  You may also click on the spyglass to display a popup window with all charge types and their description.  Highlight a charge type, then click OK, or you can double-click on the location.

• Copy – Click the Copy button to copy non-purchase charge type FQAs or Fully Qualified Accounts from one location to another.  In the copy window, enter the target location or select the location with the spyglass lookup button.  Add any element that must be changed for the target location and click the execute button to perform the copy process.

Entity Parameters Setup

The Entity Parameters Setup screen is used to define new Inventory Accounting entity to the system.  Within the screen the user will specify the ledger id, whether Inventory Accounting is single or dual currency, indicate the primary and optional secondary inventory currencies, set up all required inventory accounting journals, and input all purchase currencies and their corresponding warehouse accrual journals.  Before entering currencies in Entity Parameters Setup the currency code must first be created in the Currency Conversion module, Currency Codes Administration screen.  Journals must be defined in the General Ledger module, Journal Definition screen before they are available in this screen.

Processing the Entity Parameters Setup Screen

 Select Entity Parameters Set Up from the Utilities drop-down menu.

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• Company – If there is only one company or entity defined, it will display automatically in the text box.  Otherwise, enter a company or entity defined for Inventory Accounting or click on the drop-down arrow and select from the list.  You may also click on the spyglass to display a popup window with value company or entity and the company or entity name.

Entity Parameters Tab

The Entity Parameters Tab Setup is used to specify the following:

• Ledger ID

• Primary Currency

• Primary Currency Warehouse Journals

• Dual Currency Check Box (Used to indicate inventory accounting will be performed in two currencies.)

• Secondary Currency Journals (Dual Currency Only)

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• Ledger ID – Click on the drop-down arrow and select a ledger ID.

• Dual Currency – If inventory accounting will be performed in two currencies, check the Dual Currency check box. This will activate the Secondary Currency Journals prompts.

• Primary Currency Journals – Enter the primary currency code and primary currency warehouse journals.

• Currency – Enter a valid currency code defined in the Currency Conversion module, or click on the drop-down arrow and select from the list of available currency codes.

• Warehouse Transaction Journal – The Warehouse Transaction Journal is used to journalize “Priced” warehouse movements in primary inventory currency.  Enter a valid General Ledger module journal or click on the spyglass to display a popup window with all journals for the company and the description.  Highlight the journal, then click OK, or you can double-click on the journal.

• Warehouse Accrual Journal – The Warehouse Accrual Journal is used to accrue estimated warehouse movements when actual priced goods are not available.  The estimated transaction is reversed on the Warehouse Reverse Accrual Journal when the transaction is finally priced.  Enter a valid General Ledger module journal, or click on the spyglass to display a popup window with all journals for the company with description.  Highlight the journal, then click OK, or you can double-click on the journal.

  • In Dual Currency inventory systems there should be a corresponding secondary currency journal defined in the General Ledger module, and it should be associated with the primary Warehouse Accrual Journal in the Currency Conversion module Journal Table Administration screen.

• Warehouse Reverse Accrual Journal – See Warehouse Accrual Journal.  Enter a valid General Ledger module journal or click on the spyglass to display a popup window with all journals for the company with description.  Highlight the journal, then click OK. Or, you can double-click on the journal.

  • In Dual Currency inventory systems there should be a corresponding secondary currency journal defined in the General Ledger module, and it should be associated with the primary Warehouse Reversal Accrual Journal in the Currency Conversion module Journal Table Administration screen.

• Secondary Currency Journals  (required for dual-currency system only) - Enter the secondary currency code and secondary currency warehouse journal.

  • Currency – Enter a valid currency code defined in the Currency Conversion module, or click on the drop-down arrow and select from the list of available currency codes.

  • Warehouse Transaction Journal – The Warehouse Transaction Journal is used to journalize “Priced” warehouse movements in secondary inventory currency.  Enter a valid General Ledger module journal or click on the spyglass to display a popup window with all journals for the company and the description.  Highlight the journal, then click OK. Or, you can double-click on the journal.

Purchase Receipts Journals Tab

The Purchase Journals Tab is used to define the currencies and journals for purchase receipts accruals.  A row should be added for each currency in which stock will be purchased in the Purchase Documents module.  These journals will normally be defined as source journals to be converted to other currencies when posted in the General Ledger module.  The target journals should be defined in the General Ledger module and the source and target journals associated in the Currency Conversion module Journal Table Administration screen.

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• Currency – Enter a valid currency code, or double-click in the box to display a list of available currency codes.

• Currency Description – The currency description will be displayed in this text box.

• Journal – Enter a valid journal, or double-click in the box to display a list of available journals.  Optionally, you may click on the spyglass next to the journal text box to display a popup window with all journals for the company and their description.  Highlight the journal, then click OK. Or, you can double-click on the journal. 

• Journal Name – The journal description will be displayed in this text box.
  
  
  
  

Inter-Company Tab

The Inter-Company Tab is used to define parameters for the Inter-Company transactions.  This tab is only issued in the case that Inter-Company transactions are used.

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• Target Company – For each Company there can be multiple Target Companies. In this field, select a valid company with which the source Company may transact.

• Description – Enter text that describes the transaction activity taking place between the ‘Company’ and ‘Target Company.'

• Inter-company Receivable FQA – Enter the source Company’s FQA to which receivables for Inter-Company transactions with the select ‘Target Company’ will be posted.

• Inter-company Payable FQA – Enter the source company’s FQA to which payables for Inter-Company transactions with selected Target Company will be posted.

Inventory Accounts Setup

The Inventory Accounts Setup screen is used to cross-reference stock codes with fully qualified accounts (FQAs).  The FQAs must be cross-referenced in Chartmaster prior to being entered in this screen.  Before the FQAs can be assigned to stock codes, the stock codes (Stock Type, Category and Group) must be entered in the Purchase Document module.  FQAs may be assigned to any or all of these stock codes.  These stock codes are referenced in the Stock Master file, and when transactions are processed, the system will search this table for the appropriate inventory FQA.  The program will first look for the Stock Type (Form Stock Master) in this table.  If it does not find the Stock Type, it will search for the Stock Category and finally for the Stock Group.  These FQAs will carry the inventory value for owned and expensed items.

Processing the Inventory Accounts Setup Screen

Select Inventory Accounts Setup from the Utilities drop-down menu.

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• Company – Select the company or entity in which to establish accounts.

• Location – Select the location requiring inventory accounts.

• Group Code – Select an existing group code.  Once this is entered the group number and description will be automatically displayed on the screen.

• Copy – Click the Copy button to copy location/group code FQAs or Fully Qualified Accounts from one location to another.  In the copy window, enter the target location, or select the location with the spyglass lookup button.  Add any element that must be changed for the target location and click the execute button to perform the copy process. 

• Inventory Account FQA – Enter the Inventory Account FQA that corresponds to the group code for the location.  For warehouse type locations, the Inventory Account FQA should be a balance sheet type FQA for controllable stock types and an expense type FQA for non-controllable stock types.  For non-warehouse type locations, the Inventory Account FQA should reflect the charge to location cost type for the inventory type in the selected Group.

• Un-Priced Inventory FQA - Enter the Un-Priced Inventory Account FQA that corresponds to the group code for the location.  The Un-Priced Inventory FQA is used to accumulate the warehouse cost of inventory on open Purchase Order line items.  When the PO is closed and processed in the Inventory Accounting module, the cost is moved from the Un-Priced Inventory FQA to the Inventory FQA. 

  • This account should only be entered for controllable stock types at warehouse locations.  It is not used for non-controllable stock or for non-warehouse locations. 
    
    

• Accrual FQA  for Estimated Inventory Movements - Enter the Accrual FQA for Estimated Warehouse Movements that corresponds to the group code for the location.  The Accrual FQA for Estimated Warehouse Movements is used to accumulate estimated inventory costs for warehouse movements that are priced on an estimated basis.  When actual price of a warehouse transaction are known, the “Accrual” will be reversed. 

  • This account should only be entered for controllable stock types at warehouse locations.  It is not used for non-controllable stock or at non-warehouse locations.

Inventory System Accounts Setup

The Inventory System Accounts Setup screen is used to cross-reference specific accounting transaction types with fully qualified accounts (FQAs).  The FQAs must exist in the General Ledger prior to be entered in this screen.  You can set up FQAs by location or let all locations use the same FQAs.

Processing the Inventory System Accounts Setup Screen

Select Inventory System Accounts Setup from the Utilities drop-down menu.

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• Company – Select the company or entity requiring system accounts.

• Location – Select one location or All locations.  The system will assign accounts to transactions based on Location, but if the location does not have accounts assigned, it will get the accounts from the All record.  The All record must be set up first.

Inventory Adjustment/Material in Transit FQA Tab

The account is used to record any inventory value adjustments resulting from either a Quantity Adjustment or a Value Adjustment.  The Material in Transit is used in different ways.  It will be credited for all transfer receipts and debited for all transfer issues.  It will also be debited for inventory items that have been invoiced but not received.

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• Inventory Adjustment FQA – Enter the Inventory Adjustment FQA for the warehouse location.  The Inventory Adjustment FQA is used to offset the inventory FQA in all warehouse adjustment type transactions, i.e., Quantity Adjustments (QA), Value Adjustments (VA), etc.

• Material in Transit FQA – Enter the Material in Transit FQA for the warehouse location.  The Material in Transit FQA is used to offset the inventory FQA in all warehouse-to-warehouse movements.  It is a debit for Transfer Issue (TI) transaction type and a credit for the Transfer Receipt (TR) transaction type.

• Un-Priced Inventory FQA – Enter the Un-Priced Inventory Account FQA for the warehouse location.  The Un-Priced Inventory FQA is used to accumulate the warehouse cost of inventory on open Purchase Order line items.  When the PO is closed and processed in the Inventory Accounting module, the cost is moved from the Un-Priced Inventory FQA to the Inventory FQA.

  • The Un-Priced Inventory Account FQA may optionally be set up at the warehouse/group code level for more detail accounting.

• Allocation Pool FQA - Enter the Allocation Pool FQA for the warehouse location.  The Allocation Pool FQA is used to accumulate non-purchase costs invoiced on Purchase Orders flagged for allocation.  When the completed PO is closed, the accumulated costs are allocated to each line on the purchase order based on the actual invoiced line value.  Allocated cost for controllable stock will be transferred to the inventory FQA and included in warehouse valuation.  The allocated cost on non-controllable stock will be reversed from the Allocation Pool FQA and charged to an expense FQA. 

Accrued FQA Tab

This account is credited for inventory that was not invoiced and was received at the warehouse.  The entry will automatically be reversed when the invoice is journalized. 

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• Accrued Inventory FQA - Enter the Accrued Inventory FQA for the warehouse location.  The Accrued Inventory FQA is used to journalize warehouse Receipt (R) transaction types of controllable warehouse stock on purchase orders where goods have not been invoiced.  The entry is created in PO currency and will be reversed in the Accounts Payable module when the invoice for the goods is processed and journalized.

• Accrued Liability FQA - Enter the Accrued Liability FQA for the warehouse location.  The Accrued Liability FQA is the offset account to the Accrued  Inventory FQA for warehouse receipts.  It will be reversed in the Accounts Payable module in the same manner as the Accrued Inventory FQA.

• Accrual FQA for Estimated Inventory Movements - Enter the Accrual FQA for Estimated Warehouse Movements for warehouse location.  The Accrual FQA for Estimated Warehouse Movements is used to accumulate estimated inventory costs for warehouse movements that are priced on an estimated basis.  When actual price of a warehouse transaction is known, the Accrual will be reversed.  The Accrual FQA for Estimated Inventory Movements may optionally be set up at the warehouse/group code level for more detail accounting.

Gain/Loss FQA Tab

This account is used to record any gain or loss incurred by transferring inventory at different pricing conventions or any gain or loss incurred from the sale of an item.  Any rounding differences that occur between the invoice amount and the value assigned to pooled items when the purchase order is closed will be recorded to this account also.

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• Gain/Loss on Sale FQA - Enter the Gain/Loss on Sale FQA for the warehouse location.  The Gain/Loss on Sale FQA is used for the warehouse Sale (SL) transaction type and is calculated as the difference because the warehouse cost of goods sold and the sales value received.  The account may have a debit or credit transaction amount.

• Offset to Gain/Loss and Inventory FQA for Sales - Enter the Offset to Gain/Loss and Inventory FQA for Sales account for the warehouse location.  The Sale (SL) transaction type will debit the Offset to Gain/Loss and Inventory FQA account for the value of the Sale.  It should normally be an accounts receivable or cash account type.

Miscellaneous Setup

The Miscellaneous Setup utility is used during the installation process for Inventory Accounting.  Contact IFS IDEAS support or your IFS IDEAS consultant for more information.

Processing the Miscellaneous Setup Screen

Select Miscellaneous Setup from the Utilities drop-down menu.

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