Any ideas????
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534 Points
Posted 5 years ago
Kevin V. Russell, Accredited Partner
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5,580 Points
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534 Points
Jason Hollis, Head of Product
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10,288 Points
Hi Ben,
This is a common scenario and there are a few ways to attack it including Kevin's suggestion - especially if you are paying on a proforma prior to shipment.
The important aspect is that the BILL DATE (of the bill that includes the inventory) should be the date the goods are received at your warehouse. That is, their receipt date. This will ensure your SOH figures are accurate.
But how do I pay for the goods in advance or know the terms? There are a few options, but this is what I prefer...
a) create a BANK ACCOUNT called Goods in Transit or GIT (I like GIT)
b) Create a bill for the date of your suppliers invoice including the correct terms, however DO NOT add the inventory but instead post it to the GIT Account (under the expense tab in the bill). This gives your GIT account a credit (also useful for knowing the value of the goods you have on the water - especially if you have several in transit at once).
c) When you receive the goods convert your PO to a bill and date the bill as the receipt date (the due date is irrelevant)
d) Pay the inventory bill from the GIT account (using Pay Bills). This clears the GIT as you no longer have any goods in transit.
e) Pay the GIT bill (from step b) on the due date as per the suppliers invoice
NB. There can be quite a few variables here in terms of GST timing, foreign currency, freight forwarding fees, true landed cost, received goods total not equalling the proforma invoice total and so on so please seek advice from your accountant or a registered BAS agent (our accredited partner network is a great place to look) as this post is conceptual in nature only.
Kind regards,
Jason Hollis - Partner Relationship Manager - Business Group
Kelly Day, Accredited Partner, Accredited Partner
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2,064 Points
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130 Points
Currently we receive it into Fishbowl but this overstates our stock on the balance sheet and can cause issues for our manufacturing, as they think there is stock there for the BOM's to make our products, when there isn't.
How is it best to manage this?
Rav, Community Manager
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91,816 Points
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