SECTION 3.3.1 - ADD/SUBTRACT STOCK
USAGE: To enter stock without using the Creditor or Debtor transaction entry programs. There are two main reasons for doing this: a) you may wish not to use the Creditor sub-system to enter Purchases of stock because you purchase in different units to those you sell; b) you might receive goods before you receive the invoice and so you need to update the stock files here and then enter the value of the purchase later. If you have to pay for the goods before they are delivered, a special option is available, and is described at the end of this document.
DISCUSSION: When you start the ADD/SUBTRACT program, the computer will initially ask for an Inventory code. Insert the code and press <Enter>.
To return to the INVENTORY DATA ENTRY MENU, press <ESC>.
To search for an Inventory item, press <F9>. For further details on searches, see SECTION 1.2.
Having chosen an Inventory item, the screen will display as follows:
The following is a description of the fields displayed:
LOCATION This field is only relevant for companies using multi-location stock. Otherwise the prompt does not appear.
DATE This defaults to the system date (the date at the top of the screen). If you change it, HiFinance will retain the changed date until you exit to the INVENTORY DATA ENTRY MENU. You may press <F1> to insert today’s date.
STOCK-ON-HAND This field is displayed by the computer to show you the current status of the item. If you using multi-location stock, the field will show the stock-on-hand for the chosen location.
ADJUSTMENT QUANTITY Here you enter the number of units added to stock. To reduce stock, enter a negative number. The adjustment quantity must not be zero. If necessary, you can press <F9> to enter calculator mode.
UNIT COST PRICE Here you enter the purchase price per-unit for the items you are adding to stock. If necessary, you can press <F9> to enter calculator mode. You can enter a zero unit price but this will affect the average stock-on-hand value. By default, HiFinance will insert the average unit price but if you wish to use the last-purchase price, press <F3>.
COMMENTS You must enter a description here. Normally you would enter the invoice number or suppliers name. Once you have entered this, HiFinance will remember the value and you can repeat it by pressing <F1> until you return to MENU. There are 2 lines of description. The first one is compulsory and the second may be left blank.
ADJUSTMENT ACCOUNT This field will only appear if you have chosen Y or A in the utilities question ASK FOR G/LEDGER CODE IN INV. ADJ & REVAL? (see SECTION 7.1.2) Normally HiFinance will post to the Inventory Adjustment account as defined in CONTROL ACCOUNTS (see SECTION 6.5.2). If you enter a value here, it will override the value in CONTROL ACCOUNTS. This can be useful if you have a production department and you wish to purchase or sell stock internally posting to a specific account. The other side of the transaction will still post to the Stock-on-Hand account. You may use <F9> to search for an account.
CEDITOR CODE This field will only appear if your site uses the option to purchase stock only through this program. You are required to enter the code of the Creditor who has already been assigned the Purchase Order. You may use <F9> to search for a Creditor.
PURCHASE ORDER NO. This field will only appear if your site uses the option to purchase stock only through this program. The Purchase Order number must correspond to the Creditor, above. The order must be open and the Inventory code must appear on an uncompleted line. You may use <F9> to search for available orders for the above Creditor.
At each point, you may cancel the transaction by pressing <ESC>. However, it is possible to return to a specific field by using <CsrUp>. You can also finish a field by pressing <F10>.
When you have finished entering the required information, HiFinance will vet the information. If no missing information is detected, you will be asked, UPDATE LAST PURCHASE PRICE? If you answer Y, the LAST-PURCHASE-PRICE will be updated at the same time as the stock-on-hand is updated. Otherwise, only the average unit price will be affected.
Finally you will be asked to confirm the update and the computer will update the relevant files. When this has completed, you will be returned to the Inventory code entry screen where you may either enter another transaction or press <ESC> to return to the INVENTORY DATA ENTRY MENU.
Files updated by the Add/Subtract program:
Inventory master-file: The total of the units and value will be added to the units-on-hand and value-on-hand fields, respectively. If you have chosen the option, the last-purchase-price will also be updated.
Inventory transaction file: Each update generates a transaction. This can be viewed in INVENTORY ENQUIRIES and is used to create reports, such as INVENTORY TRANSACTIONS.
Creditor Purchase Orders Where relevant (see above) the purchase order will be updated. Also, the quantity on order for the corresponding Inventory item will be updated.
General Ledger master-file: The Stock-on-Hand and Inventory Adjustments accounts (unless overridden) are updated with the value of the transaction.
General Ledger transaction-file: A transaction is posted for each General Ledger account updated, above.
Special Procedure for Updating Purchase Orders from the Add/Subtract Stock screen.
This special feature is only available when the option is enabled at your site. The feature is more sophisticated than the simple solution of entering goods via the Add/Subtract function and separately entering a purchase and paying for it. The option works for both FIS (Free-in-Store – goods arrive and are then paid for) and FOB (Free-Onboard – goods are paid for as they leave the factory). It allows you to enter a Purchase Order (with stock), convert it to a Purchase and pay for the Purchase, separately from the actual take-up of the stock. Without this feature, converting a Purchase Order to a Purchase would immediately update stock, so you would need to cancel the Purchase Order, enter a Purchase for the value only, and then use the Add/Subtract function to account for the stock. There would thus be no simple reconciliation between the quantity of stock received and the quantity ordered. The special feature, described here, allows you to use the Add/Subtract function, rather than the Purchase, to update the Purchase Order, thus allowing you to reconcile stock without having to do any “off-book” accounting.
With the Add/Subtract special link function installed, you should follow the procedure below:
1) Enter Purchase Orders as per normal.
2) The Purchase is made when the order is due (usually when it is ready for shipping or an agreed time after). No new Inventory lines may be entered on a Purchase, which did not already exist on the Purchase Order.
3) When a Purchase Order is turned (partially or completely) into a Purchase, the stock-on-hand is not updated (although the quantity-on-order is reduced). Also, no transaction is created in the Inventory transaction file.
4) The General Ledger is updated to the Stock-In-Transit account, not the Stock-on-hand.
5) When the stock physically arrives, it is entered via Stock Add/Subtract. This program will need to ask for the Purchase Order number and the Creditor. No Add/Subtract will be possible unless there is a Purchase Order to match, and that Order must contain the relevant stock code and that stock line, and Purchase Order, must not be tagged as completed.
6) The Purchase Order cannot be completed by the usual question in Purchasing. Nor can it be completed via the Add/Subtract program. It must be manually completed by a new function to be added to the Purchase Order maintenance program. Orders will only be completed when the purchasing officer deems them complete (not necessarily by the person entering the Add/Subtract). The advantage of completing the order is that it clears all the Stock on Purchase Order and allows the order to be deleted in bulk by the Utility Pack program.
7) Local stock must also be added via a Purchase Order because Purchases will not allow stock items to be entered, unless they carried across from a Purchase Order.
8) To add ad-hoc stock (ie items that are assembled into kits internally), you will need to create a dummy Creditor (eg INTERNAL) and create a dummy Purchase Order with a complete list of possible inventory items. If it is more convenient, this may be split over several Creditor and Purchase Orders, but one containing all, will probably suffice.
9) The Creditor Code is optional. If you leave it out, the program defaults the update back to the normal ADD/SUBTRACT, ie no Purchase Order is updated. The screen will warn you that you have not entered a Creditor.
10) Purchases of utilities, etc can be added via a Purchase without any Purchase Order (the initial restriction has been removed). However, it is not possible to add inventory lines to such an entry, only General Ledger and Text lines are possible. (If you must enter Inventory lines, a Purchase Order must be created first - see above.)