DBA Help

(Inventory – Reconcile Book Values)

Use this screen to reconcile Book Value with “actual value” on all items where there is a discrepancy between the two values.  

 

What is Book Value?  

Book Value is the sum of all General Ledger debit and credit transactions made against a stock item.    

What is “actual value?”  

“Actual value” is each item’s stock quantity multiplied by its current Inventory Cost.  

What causes a discrepancy between the two values?  

Minor discrepancies can occur when inventory transactions involving multiple decimal places are rounded up or down when posted to the general ledger, which stores monetary amounts in two decimal places.    

 

There is a potential book value differential when you reverse a PO Receipt or Job Receipt and the reversal transaction is performed at a different value than the inventory cost for the item.   After the reversal transaction occurs, the system will re-average the remaining quantity on hand to calculate a new average cost.   If there is not any qty remaining after the reversal or if the remaining quantity re-calculation requires a negative inventory value, then there can be a book value discrepancy that will need to be reconciled.

 

Prior to July 2009, an item’s stock quantity was allowed to go negative when issues and receipts were entered out of sequence.  When stock was received at a new cost while stock was negative, the stock receipt cost, which is a calculated average, could differ from the receipt cost that was posted to the general ledger.  As of build 388 the system no longer allows stock to go negative, which eliminates negative stock as a source of cost discrepancies.  

What does this screen do?  

This screen compares each item’s Book Value with its actual value.  When a discrepancy between the two values is found, the Book Value is adjusted so that it is made equal to the actual value.    

How often should this be run?  

We recommend that you Reconcile Book Values as a routine procedure at each period end.  

When the screen launches, it automatically goes through all your stock items and lists any item that has a discrepancy between its Units * Cost and Book Value.  

The Reconcile checkbox is automatically selected against each item.  When you click the Reconcile button, Book Value is adjusted for all items that have this checkbox selected.  

Ledger Posting

If Book Value is too high against an item, this transaction is made to the General Ledger.  

 

 

If Book Value is too low against an item, this transaction is made to the General Ledger.