Overview

While the basic setup of Perpetual Inventory in iVendNext ensures real-time tracking of stock and account balances, the system also offers advanced features that enhance inventory and financial management. These features allow businesses to handle complex scenarios such as back-dated transactions, landed costs, and stock adjustments with ease. This article explores these advanced features, providing step-by-step guidance on how to use them effectively.

To be able to use the Perpetual Inventory feature, you must enable the feature first by navigating to: Home > Accounting > Company > Enable Perpetual Inventory

1. Handling Back-Dated Transactions

Back-dated transactions are entries made with a date earlier than the current date. In iVendNext, these transactions can impact future stock and account balances, but the system is designed to handle them seamlessly.

1.1 How Back-Dated Transactions Work

• Recalculation: When you enter a back-dated transaction, iVendNext automatically recalculates all future stock and account balances to reflect the changes.

• Impact on Valuation: Back-dated transactions can affect inventory valuation (e.g., FIFO, Moving Average) and Cost of Goods Sold (COGS).

1.2 Best Practices for Back-Dated Transactions

• Review Future Balances: After entering a back-dated transaction, review the stock and account balances to ensure they have been correctly recalculated.

• Avoid Frequent Back-Dating: Minimize the use of back-dated transactions to prevent unnecessary complexity in your records.

Example:

• You enter a back-dated Purchase Receipt for 10 units of an item at $200 each, dated one month ago.

• The system recalculates the stock and account balances for all transactions that occurred after the back-dated entry.

2. Using Landed Cost Vouchers

Landed costs refer to additional expenses incurred during the procurement of inventory, such as shipping, customs duties, and insurance. iVendNext allows you to allocate these costs to inventory using Landed Cost Vouchers.

2.1 Purpose of Landed Cost Vouchers

• Accurate Valuation: Landed costs are included in the inventory valuation, ensuring accurate costing.

• Expense Allocation: These costs are allocated to specific items, providing a clear picture of the total cost of goods.

2.2 Steps to Create a Landed Cost Voucher

1. Navigate to Landed Cost Vouchers:

• Go to Stock > Landed Cost Vouchers.

2. Select Purchase Receipt:

• Choose the Purchase Receipt for which you want to allocate landed costs.

3. Add Additional Costs:

• Enter the additional costs (e.g., shipping, customs) and allocate them to the relevant items.

4. Submit the Voucher:

• Submit the Landed Cost Voucher to update the inventory valuation.

Example:

• You receive a shipment with a total cost of $2,000 and incur $200 in shipping and $100 in customs duties.

• Create a Landed Cost Voucher to allocate these costs to the items, increasing their valuation accordingly.

3. Managing Stock Adjustments

Stock adjustments are necessary when there are discrepancies between physical stock counts and system records. iVendNext provides a Stock Adjustment feature to reconcile these differences.

3.1 When to Use Stock Adjustments

• Physical Count Discrepancies: When the physical stock count does not match the system records.

• Damage or Theft: When stock is lost, damaged, or stolen.

• Expiry or Obsolescence: When stock becomes obsolete or expires.

3.2 Steps to Create a Stock Adjustment

1. Navigate to Stock Adjustments:

• Go to Stock > Stock Adjustment.

2. Select Warehouse and Item:

• Choose the warehouse and item for which you want to make an adjustment.

3. Enter Adjustment Details:

• Specify the quantity to be adjusted and the reason for the adjustment.

4. Submit the Adjustment:

• Submit the Stock Adjustment to update the stock and account balances.

Example:

• You find that 5 units of an item are missing during a physical stock count.

• Create a Stock Adjustment to reduce the stock quantity by 5 units. The system will automatically adjust the corresponding financial accounts.

4. Handling Stock Transfers

Stock transfers involve moving items from one warehouse to another. In iVendNext, these transfers are seamlessly integrated into the Perpetual Inventory System.

4.1 How Stock Transfers Work

• Source and Target Warehouses: Specify the source and target warehouses for the transfer.

• Automatic GL Entries: The system generates automatic GL entries to reflect the transfer in the financial records.

4.2 Steps to Create a Stock Transfer

1. Navigate to Stock Transfers:

• Go to Stock > Stock Transfer.

2. Select Source and Target Warehouses:

• Choose the source and target warehouses.

3. Enter Transfer Details:

• Specify the items and quantities to be transferred.

4. Submit the Transfer:

• Submit the Stock Transfer to update the stock and account balances.

Example:

• You transfer 10 units of an item from the "Stores" warehouse to the "Finished Goods" warehouse.

• The system debits the "Finished Goods" account and credits the "Stores" account.

5. Troubleshooting Advanced Features

While using advanced features, you may encounter some issues. Here’s how to resolve them:

5.1 Incorrect Landed Cost Allocation

• Issue: Landed costs are not allocated correctly to items.

• Solution: Review the Landed Cost Voucher and reallocate the costs as needed.

5.2 Stock Adjustment Errors

• Issue: Stock adjustments are not reflected correctly in the financial accounts.

• Solution: Verify the accounts linked to the warehouse and ensure the adjustment is correctly recorded.

5.3 Stock Transfer Mismatches

• Issue: Stock transfers cause mismatches between source and target warehouse balances.

• Solution: Review the transfer details and ensure the correct accounts are linked to both warehouses.

6. Best Practices for Using Advanced Features

To maximize the benefits of advanced Perpetual Inventory features, follow these best practices:

1. Regular Reviews:

• Periodically review back-dated transactions, landed costs, and stock adjustments to ensure accuracy.

2. Training for Users:

• Train your team on how to use advanced features effectively.

3. Monitor Balances:

• Regularly monitor stock and account balances to identify and resolve discrepancies early.

4. Document Processes:

• Document the processes for handling back-dated transactions, landed costs, and stock adjustments to ensure consistency.

7. Conclusion

iVendNext’s advanced Perpetual Inventory features provide businesses with the tools to handle complex inventory and financial scenarios with ease. By leveraging features such as back-dated transactions, Landed Cost Vouchers, and stock adjustments, you can ensure accurate inventory valuation, streamline operations, and maintain financial integrity. Follow the steps and best practices outlined in this article to unlock the full potential of iVendNext’s Perpetual Inventory System.