Accounting Finance:Inventory Invoices-Entering Inventory Invoices for Payment

Overview

Pre-checking inventory invoices is required before payment entry. The system handles automatic creation of quantity, price and exchange rate differences. Two different kinds of variances can occur on the same invoice: price and quantity. Manual price changes are only performed if the variance is because of incorrect pricing on the PO and not a supplier error. If the variance is due to a supplier error, the supplier must be debited back for the variance unless they are able to provide a credit note on the day we need to enter the invoice. Quantity variances occur when products are shorted or come in damaged. Whenever a product needs to be returned regardless if charged or not a debit note is generated.

In general we follow the $50 rule: anything over $50 we debit back the supplier, anything less we post as profit/loss unless the buyer directs us otherwise.

Invoice Entry for Payment

Working from the screen above:

1. Type 1, press enter
2. Type 2, press enter
3. Type 3, press enter
4. Type 2, press enter
5. Type 1, press enter
6. Type '30' beside the voucher type, press enter

Using the information on the invoice, enter the following information:

1. Document type 'INV'
2. Document number = PO number
3. Supplier number
4. Supplier invoice number (entered exactly as shown on the invoice)
5. Invoice date (mm/dd/yy)
6. Invoice total
7. Invoice matching should be 'Y'
8. Text = Invoice number or anything relevant regarding the invoice

When done press enter and hit F12 to go back. Due date, Terms of payment and Payment mode are automatically populated.

Make sure the terms match the payment terms on the invoice. Change if needed or press 'F8' to change discount due date, discount %, or discount base (if applicable). For net discount invoices (discounts calculated before taxes) enter the correct discount base as a positive. Note: 'F8' will also give you details on address and payment terms description.

1. Enter GST (we do not pay PST on inventory invoices)
2. Enter Freight (optional)
3. Enter Volume Rebate (optional)
4. Enter Discount from Supplier (optional)
5. Enter Ecotax (optional)

Enter '1' next to purchase order Enter purchase order number (you may enter up to 5 PO's at the same time) Press 'enter' to confirm OR Press 'enter' for a selection of opened purchase orders

Note: In the header of this panel you will see two fields, manually posted amount, which, if entered is the manually entered amounts and previously matched amount. These amounts are updated with each matching and automatically reduces the remaining amount. If supplier on invoice is different from purchase order, check with the buyer who we should pay.

To match the received products against the invoice to be paid put '2' beside the line item and press enter.

Make sure that the price and quantity matches the invoice to be paid. If there is a variance notify and ask the buyer for direction by creating a hotline incident. If the variance is due to our error (i.e. our price is higher than invoice price) change the price manually. Check all the lines needed and press 'F10' to update.

Note:Buyers should be notified of all pricing discrepancies except those due to rounding. A hotline must be created (Problem: 'PRICHG' and Resolution: 'VPRICE'). See screenshot for format:

GL Postings

If a there is a variance between the Document Amount and Selected Amount you will be prompted to go through the GL postings screen where you would need to post the amount to a specific GL: (Press: 'F4' to see the accounts and 'F8" to enlarge)

Common GL accounts used:

1. 420450/1120 Price Variance
2. 420500/1120 Quantity Variance
3. 420525/1120 Rounding Variance'
4. 210625 Debit note Discrepancy (should have an offset entry)
5. 210100 Credit adjustment (should have an offset entry)