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Hi,
I would like to understand the standard process for inventory item import and their valuation method. Whether I should 1st count it and then import it (and if so how - what kind of transaction should I be entering to update the value) or should I deal with subledger and gl separately, what do you follow and recommend for the initial implementation?
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First the item import. The valuation method should be known. You aren't supposed to change the historical inventory valuation method. Most of the clients that I have use either FIFO perpetual or FIFO periodic. If this is not a brand new business, the valuation method should already have been established.
For the item count, I do a physical count of the inventory and then import an inventory transaction for the day before my year begins, or on cutover if you're starting in the middle of the year. The inventory transaction will want to automatically update the general ledger. If you DO have the FIFO layer information and it's something you need to maintain, then you'll need to do separate imports by layer date - personally, I've never had anyone ask me to do that.
Many implementations handle the subledger and general ledger separately because it's easier. You just import the GL balances and make sure the total matches your stock status report after you import the inventory transactions. Be sure not to post the inventory transaction to the general ledger or you will overstate inventory on the balance sheet. I don't think there's a 'best practices' rule on how to do it. I let the subledger flow up because I like to be able to drill-back, but it could take a little longer to do it this way. Often I just do it separately because it's quicker.
Kind regards,
Leslie
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Almas Mahfooz
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