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Hi
I have been working with a client at the moment about the best way to process inventory related returns to suppliers. Return with credit is no problem as the invoice has been matched which closes out the PO.
The problem I can't see a way around at the moment is how Return work when the goods have been received but not invoice matched. This is the scenario that I am seeing (in order of processing):
PO for qty 2,000
Goods receipt for qty 2,000 (GL - DR inventory, CR purchases accruals)
Return processed for qty 150 (GL - DR purchases accruals, CR inventory)
Invoice match for qty 2,000 (as the PO is not updated and the person matching the invoice does not know about the Return), (GL - DR purchase accruals, CR accounts payable)
When you process the return, it increases "qty sold" rather than decreases "qty received". Inventory quantities are fine and it disappears of the Received Not Invoiced report as it was fully matched. There would however be a variance between the Received Not Invoice report and the GL.
The way this is handled seems a little strange to me. No "matching" errors are noted based on the reduced received amount, as the amount isn't reduced but it is sold.
So my problem - how does the AP clerk know that when she matches the invoice that there has actually been a return? There is no cross-check with inventory or am I missing something?
Cheers
Heather
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Richard - thanks for clarifying some of those details. I had sorted about the fact that the goods cannot be used if you want to return them, that makes sense.
Frank - thanks for clarifying. I haven't tried it in 2010 but will do so that I have clear in my head where the changes up. You have confirmed what I suspected and I will set up some form of exception report for PO Order <> PO Receipt <> PO Invoice.
Thanks for the help.
As you've experienced and Richard has verified Heather, there are some gaps in GP PO Returns processing. In GP10 and previous versions, the PO quantity is not updated when a Return is processed. GP2010 has addressed this such that a Return does now update the Remaining to Ship and Remaining to Invoice quantities.
If you're not on GP2010 you might want to look at a SmartList or a combination of SmartList and Business Alert to inform the AP clerks when a Return transaction has been processed. This would at least give them a heads up that a return has occurred.
Hope this helps,
PO returns under versions earlier than 2010 worked poorly. 2010 makes things better but not perfect. You cannot perform a RETURN transaction if the goods have been issued or sold and then returned by the consumer into the inventory. At that point, an INVENTORY transaction must be used in the PO Return transaction.
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