Overview

This article provides a comprehensive guide to identifying, troubleshooting, and resolving stock and account balance mismatches in iVendNext.

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

Note: Once enabled, iVendNext will automatically generate General Ledger (GL) entries for every stock transaction, ensuring real-time sync between stock and account balances.

1. Common Causes of Stock and Account Balance Mismatches

Before diving into troubleshooting, it’s important to understand the common causes of mismatches:

1.1 Manual Errors

• Incorrect Data Entry: Mistakes in entering stock quantities, rates, or account details during transactions.

• Misclassification: Incorrectly classifying stock items as non-stock items (or vice versa).

1.2 Back-Dated Transactions

• Impact: Entering transactions with past dates can affect future stock and account balances if not handled correctly.

• Recalculation: The system recalculates balances for all future transactions, which can sometimes lead to discrepancies.

1.3 Incorrect Account Linkage

• Missing or Incorrect Accounts: If default accounts (e.g., Default Inventory Account, Stock Received But Not Billed) are not set up correctly, the system may generate incorrect GL entries.

• Warehouse-Account Mismatch: If accounts are not linked to warehouses properly, transactions may be posted to the wrong accounts.

1.4 Stock Adjustments

• Unrecorded Adjustments: Physical stock adjustments (e.g., damage, theft) that are not recorded in the system can lead to mismatches.

• Incorrect Adjustments: Stock adjustments that are not properly accounted for in the financial records.

2. Identifying Mismatches

To troubleshoot mismatches, you first need to identify where the discrepancy lies. Here’s how to do it:

2.1 Compare Stock Ledger and Stock Account Balances

• Stock Ledger: Tracks the physical movement of inventory.

• Stock Account: Tracks the financial value of inventory.

• Action: Compare the balances in the Stock Ledger and the Stock Account to identify discrepancies.

2.2 Run Reports

• Stock Balance Report: Provides a summary of stock quantities and values.

• General Ledger Report: Shows the financial entries related to inventory.

• Action: Run these reports and compare the data to pinpoint the source of the mismatch.

2.3 Check Transaction History

• Review Recent Transactions: Look for any unusual or incorrect entries in recent stock transactions (e.g., Purchase Receipts, Sales Invoices, Stock Adjustments).

• Action: Identify any transactions that may have caused the mismatch.

3. Resolving Mismatches

Once you’ve identified the cause of the mismatch, follow these steps to resolve it:

3.1 Create a Journal Entry to Sync Balances

• Purpose: Use a Journal Entry to manually adjust the stock and account balances.

• Steps:

1. Go to Accounts > Journal Entry.

2. Create a new Journal Entry.

3. Debit or Credit the relevant accounts to sync the balances.

4. Save and submit the Journal Entry.

Example:

• If the Stock Account balance is lower than the Stock Ledger balance:

• Debit: Stock-in-Hand Account.

• Credit: Expense Account (e.g., Cost of Goods Sold).

3.2 Correct Incorrect Transactions

• Identify Incorrect Entries: Review the transaction history to find any incorrect entries.

• Action: Amend or cancel the incorrect transactions and re-enter them correctly.

3.3 Update Account Linkages

• Verify Default Accounts: Ensure that all default accounts (e.g., Default Inventory Account, Stock Received But Not Billed) are correctly set up in the company settings.

• Link Warehouses to Accounts: Go to Stock > Warehouses and verify that each warehouse is linked to the correct account.

3.4 Handle Back-Dated Transactions

• Review Back-Dated Entries: Check for any back-dated transactions that may have affected future balances.

• Action: Ensure that the system has correctly recalculated balances for all future transactions.

3.5 Record Stock Adjustments

• Physical Stock Count: Conduct a physical stock count to identify any unrecorded adjustments.

• Action: Record the adjustments in the system using the Stock Adjustment feature. The system will automatically update the corresponding financial accounts.

4. Preventing Future Mismatches

To avoid future mismatches, follow these best practices:

4.1 Regular Reconciliation

• Periodic Checks: Regularly reconcile stock balances with account balances to identify and resolve discrepancies early.

• Monthly Reviews: Conduct monthly reviews of stock and account balances.

4.2 Accurate Data Entry

• Training: Train your team on the importance of accurate data entry during stock transactions.

• Double-Check: Implement a double-check system for critical transactions (e.g., Purchase Receipts, Sales Invoices).

4.3 Proper Configuration

• Default Accounts: Ensure that all default accounts are correctly set up in the company settings.

• Warehouse-Account Linkage: Verify that each warehouse is linked to the correct account.

4.4 Monitor Back-Dated Transactions

• Caution: Be cautious when entering back-dated transactions, as they can impact future balances.

• Review: Regularly review back-dated entries to ensure they are correctly handled.