Sales invoice corrections

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anonymous

15 Apr, 2010 08:27 PM

After upgrading to Premier I am finding that when I process an invoice the system no longer prompts to build items with a 0 inventory count. Previously when printing the invoice the system would ask if you wanted to build these 0 count items (these are kits in our case). Now I have to manually auto build these items. The system will inform me that one or more items on the invoice are going negative but does not indicate which ones so I have to manually keep track and do the auto build manually. And the worst part is that if I need to make a correction to an invoice with this problem (negative inventory items) I get a message that says a negative inventory sale with an inventory adjustment applied may not be changed. I even tried deleting the payment and deleting the invoice in order to rebill it correctly and got the same message. I've checked all my preferences and find no references to this situation. I can't believe a product with these kind of defects can be shipped to customers as a quality product. And on top of that your full support is daytime only? Come on people. Support needs to be 24/7, especially if you're going to charge for it.

  1. 1 Posted by anonymous on 15 Apr, 2010 08:27 PM

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    When you turn on the negative inventory preference, MYOB Will allow you to sell builds that you don't have on hand. You can review your auto-build list to see which ones you need to build.

    Once you Build, you cannot change the invoice that caused you to go negative, because of the complicated adjustments that are made to cost of goods when you sell into the negative.

    You can make adjustments to the invoice BEFORE you build (or buy) the items that impact a negative sales invoice.

  2. 2 Posted by anonymous on 15 Apr, 2010 08:27 PM

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    Complicated adjustments are one of the main reasons we have a computer system. How complicated is it to reverse an entry? We oftentimes have to adjust an invoice due to a customers request after it is printed and before it is shipped because we believe in customer service. Why should you be able to tell me that I can't adjust an invoice. I find it totally ridiculous. The allowing of negative inventory counts was the main reason I purchased your upgrade and now I find that it is almost totally worthless due to the restrictions you've applied to it and the way I do business. More than likely we will have to turn it off. Why you think you should dictate to me the way I do business is beyond me.

  3. 3 Posted by anonymous on 15 Apr, 2010 08:27 PM

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    Thank you for your feedback. Design is looking into ways to improve the process. Please send your exact request from your Help menu/Send Feedback. This goes right to the design team.

  4. 4 Posted by anonymous on 15 Apr, 2010 08:27 PM

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    Has MYOB come up with a work around for this yet? I am totally aghast that I cannot reverse a sale or worse yet enter shipping due on an invoice even if I don't want to change the sales numbers of any items!! I find it completely ridiculous that I cannot delete a sale or reverse a sale if I want to. There must be some way to over ride the unchangeable transaction rule.

  5. 5 Posted by anonymous on 15 Apr, 2010 08:27 PM

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    quote:
    Originally posted by earthdance:
    Has MYOB come up with a work around for this yet? I am totally aghast that I cannot reverse a sale or worse yet enter shipping due on an invoice even if I don't want to change the sales numbers of any items!! I find it completely ridiculous that I cannot delete a sale or reverse a sale if I want to. There must be some way to over ride the unchangeable transaction rule.


    First of all, you haven't stated what version you are using. I'm going to assume Premier 2006. Most of what I write will be applicable to older versions, what is not may be obvious.

    I'm going to assume that you have unchecked, under Setup/Preferences/Security, the box that says Tranactions CAN'T be changed, they must be reversed (System-wide).

    Unfortunately, with MYOB, this is not all of it. MYOB freezes transactions in various ways and for various reasons. It goes way beyond reasonable necessity. But you should be able to reverse sales. Always. I've never seen a sale that could not be reversed. Reversing a sale is not the same thing as deleting it, deleting a sale eliminates it and all consequential transactions, such as reductions of inventory. Reversing a sale leaves the sale and all those transactions in place, but creates equal and opposite ones.

    However, if you reverse a sale that has a payment applied to it, where does the payment go? For this reason, MYOB may refuse to reverse a paid or partially-paid invoice. (I'm not sure of all the conditions, sometimes it seems that I can do something that otherwise I can't do.... but I think that this may be the most common reason). To work with such an invoice, the payment will have to be deleted or reversed. This exposes another shortcoming of the way the program is arranged: if I have applied a payment incorrectly, I can't just change the application, if it is a payment of an invoice. I have to delete the payment and re-enter it.

    When invoices are frozen, in Premier, you can't change anything about them, which is truly irritating. Converting from version 11 to Premier, all transactions involving inventory were frozen. Now, that's bad enough. But I can't even read everything in those invoices, except by printing them, say, to PDF. (I often have more information in a Description field than will show in the display. In an invoice that is not frozen, this is no problem: just click on the field and it expands to show everything.)

    The way that these freezes were implemented was really pretty bad.... and, I think, unnecessary. The real problem is that MYOB had no sound method of dealing with inventory, until version 12. It is beyond me how this was ever considered adequate, and MYOB still does not report the basic information one needs to fill out a U.S. Schedule C: Total of purchases. Instead, MYOB keeps a running total of Cost of Goods Sold, which, together with the previous Inventory Value and the end-of-period one, and other adjustments, can be used to calculate a presumed total of purchases. Backwards.

    Another cause of freezes came with a new feature: negative inventory. You can now make a sale that creates negative inventory. I'd been asking for this for years, Quickbooks had it. But MYOB, when you create negative inventory, and then fix it, freezes all the associated transactions.

    Let me say this: Freezes bad, flexibility good. If one is concerned about security, sure, freezing all transactions and requiring reversals makes sense. Maybe. I'm not sure. All I know is that when I get a statement from a vendor, and it is full of reversals, it becomes very, very hard to understand. So I don't want to give such statements to *my* customers. And I don't want to have to dig through them when I'm trying to understand what is going on.

    MYOB, I'm sure, froze transactions from the update, from negative inventory, etc., for programming reasons. But what this means to me is that they did not want to go to the trouble of doing it right. You can allow negative inventory without freezing transactions (indeed, allowing negative inventory should allow any transaction to be deleted, including incorrect purchases, which are the other side of the freeze nuisance....)

    Summary: delete or unapply payments if these are what is causing the freeze. Try to get invoices right in the first place, if you can. Important: don't apply a payment while you are entering an invoice. In fact, don't enter invoices immediately, enter an order, record it, *then* turn it into an invoice. Record the invoice, *then* pay it. If you make the payment part of the invoice itself, as MYOB surely tempts you to do, you cannot then delete the payment because it would involve deleting an invoice with a payment applied. Yes, Catch-22. We learned the hard way.
  6. 6 Posted by anonymous on 15 Apr, 2010 08:27 PM

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    quote:
    Originally posted by MYOB101:
    Once you Build, you cannot change the invoice that caused you to go negative, because of the complicated adjustments that are made to cost of goods when you sell into the negative.


    Build is a transaction that transfers inventory from one item to another, with zero effect on overall value. This has nothing to do with negative inventory, though certainly a build can eliminate a negative inventory.

    MYOB, early on, apparently decided to keep an actual Cost of Goods sold account. This is a single account that accumulates all costs from items being taken out of inventory through being sold. But one can also post directly to the COGS account. For example, one could choose to post shrinkage to Cost of Goods Sold. Or to reduce Cost of Goods sold from found inventory.

    Problem is, the Cost of Goods sold is a very complex matter, it depends on what was paid for the goods, adjustments, etc., as well as transfers involving the goods, a host of transactions can be involved in coming up with the cost of a single sale. MYOB picked a method of inventory valuation which is not one of the common standards, I think it is called Average Cost. Whenever the item is purchased, the quantity is added to a register for the item, and the total price is added to a total value register for the item. It is more common, in standard bookkeeping, to have valuation schemes like First-In, First-Out, or Last-in, First-Out, which, in a sense, values each item in the inventory at what was actually paid for that unit, and then makes a presumption about which items were sold. But Average Cost is simpler to accumulate with a computer, and the tax rules allow any reasonable scheme to be used.

    Whenever an item is sold, under Average Cost, the current total value is divided by the number of units in inventory to get the average unit cost of that item, multiplied by the number of units sold, which is then debited to Cost of Goods Sold, and the inventory is reduced and total value reduced accordingly.

    So what happens with negative inventory? Well, negative inventory is an impossible situation, in reality. It always represents an inventory error of some kind. But the straightforward way to deal with it is to assume that all negative inventory has a value of zero. After all, if there is no bill in the system for this negative stuff, one did not pay for it. Negative inventory would never have negative value.

    So what happens when the purchase invoice is finally entered? Or the item is built, which is really the same thing. Well, those items going into inventory have a defined value, based on the vendor invoice or on calculations from what the items were built from. All or some of these items are going to fall into the maw of the negative inventory, and are not going to increase the value of inventory. So where does the value go? To Cost of Goods Sold, of course, where it belonged in the first place. The only problem, really, is the date of the debit to COGS. And if, in fact, I purchased the goods after I sold them, there is no problem with the delay in date.... I haven't incurred a cost, not for sure, until I've got an invoice from the vendor.

    This can get really complicated, to be sure, depending on how closely one wants Cost of Goods Sold to track the transactions. Quickbooks took a totally different approach from MYOB, I think. They recalculate Cost of Goods sold, so that one can change any of the source transactions that affect it, and Cost of Goods sold is properly corrected, with the correct date sequence. I suspect that MYOB is still holding on to the original way of handling it, to some extent, which is why it was considered necessary to freeze the transactions. MYOB, unless it has changed, will end up with an incorrect valuation, and therefore an incorrect cost of goods sold, if a vendor bill is, for example, changed after some of the goods have been sold. This is a tipoff that MYOB is not handling it as does Quickbooks. Invoices affect inventory value, not cost of goods sold, which is only debited as items are sold, when they are sold.

    A build is just another kind of source transaction....

    It should not have been necessary to freeze the transactions. And the thinking that is allowing errors like this to continue to propagate should be addressed.

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