Reconciling your physical inventory to the General Ledger account can be a daunting task. Here are some reasons why you may be out of balance between your physical count and the GL in BusinessVision:
- The opening balance was incorrect when first setting up the software.
- There is a setting in BusinessVision that will let you overwrite the on-hand balance without leaving an audit trail. This will change the value of the inventory without changing the General Ledger.
- BusinessVision gives you the option of posting to the GL when you manually receive inventory. I highly recommend that you turn this option on so that it does create a journal entry.
- If you have non-physical items, it is VERY important that the sales department is set up correctly. If the item has a cost on it and the sales department directs the receiving and sales to an asset account, then the potential for the GL being out of balance is very high.
- If you have “Close PO’s to AP” unchecked in the system setup, then the automatic reconciliation of receiving to AP is not done and relies on the user to manually checking it.
- A system crash during a posting can result in partially posted transactions. Your system should be checked if you have frequent crashes.
- Restoring a file from your data instead of the complete folder. For instance, if you restore the inventory file and not the GL file, they will no longer be balanced.
- If a user posts an entry directly to the inventory GL account, it will no longer be balanced to the inventory subledger.
It would be a good idea to pay attention to this GL account to avoid year-end surprises, or you may end up writing off the difference. This may also jeopardize your line of credit if you have a covenant with a bank that uses your inventory value as collateral.
Posted on August 1, 2013 by Al Romeyn | Permalink