Problem with purchase order accounting enteries.

[Mohd Viqar]

Hi All,
I'm facing the below problem with accounting entries of purchase order, would appreciate any help with the same

When I create a purchase order for lets say $15 and receive the inventory for that purchase order, I get the following accounting entry.
Invenroty Dr $15
Uninvoiced Item Receipts Cr $15

Then when I go to the purchase invoice that's automatically generated by receiving the product and change its status to "Ready', it  creates a new accounting transaction entry as follows
Inventory Dr $15
Accounts Payable Cr $15

thus the Trial balance show:
Account Code Account Name                                   Dr       Cr Ending Balance
140000 INVENTORY                                 $30.00 $0.00 $30.00
210000 ACCOUNTS PAYABLE                     $0.00 $15.00 $15.00
214000 UNINVOICED ITEM RECEIPTS       $0.00 $15.00 $15.00

It should have ideally reversed the uninvoiced item receipts as follows
Uninvoiced Item Receipts Dr $15
Accounts Payable Cr $15
Account Code Account Name                                   Dr       Cr Ending Balance
140000 INVENTORY                                 $15.00 $0.00 $15.00
210000 ACCOUNTS PAYABLE                     $0.00 $15.00 $15.00
214000 UNINVOICED ITEM RECEIPTS       $15.00 $15.00 $0.00

I've tested this on the trunk with the below mentioned data and it give me the same results..

Product : GZ-1000-0 - Tiny Gizmo  
Quantity : 2
Price : $7.5
Total value: $15
Supplier : Demo Supplier

so i'm wondering if I'm doing something wrong or if this is a bug..

[Sharan-F]

Hi

Yes I agree with you that it doesnt seem right. I will do some tests too and see if I can replicate this.

Thanks
Sharan

[Sharan-F]

Hi

I’ve replicated this and I think it is a bug.

I agree with you that changing the invoice status to “Ready” should reverse the “Uninvoiced Shipment Receipts” entry – (because what you are saying when you change the status is that you have received the Supplier Invoice - so it is no longer uninvoiced, made any updates and are ready to post it).

I wonder if this is only happening on manual Purchase Order Entry because I would have thought that other people would have across this too.

During my tests I did find another potential issue and this is related to payments. I’ve come across a variation of it before replying to a query on the Drop Shipment process.

• When you receive Purchase Order into inventory a “payment” is created under the “Payment Information” section of the Purchase Order.
• Using your example a Payment is created for an amount of $15 with a status of “Not Paid”
• When you receive the Purchase Order, the Pro Forma invoice is also created and is displayed below the payment.
• If you click the link to the Pro Forma Invoice and look at the “Terms” section which shows the “Outstanding Amount” you will see that it is now showing zero. (I don’t think this is correct because you haven’t paid the supplier yet! I think the Outstanding Amount on the Pro Forma invoice should still be $15.)

If you then go to Accounting Manager / Payments to locate Purchase Invoices by due date then this invoice isnt displayed even though the Due Date is the current date. I think this is because the Outstanding Amount is zero, OFBiz thinks that the invoice has already been paid (when it hasn’t).

I will take a look at Jira to see if any of these have already been reported and if not then I’ll create a new one.

Thanks
Sharan

[Sharan-F]

Hi

Just to let you know that I've created a new Jira for this - it's number is 5641.

Thanks
Sharan

[Mohd Viqar]

Thanks for creating Jira for the issue. If someone can tell me where to look I can try to fix the issue

[Mohd Viqar]

payment is automatically created when a purchase order is approved as per the settings in AccountingConfig.properties

# create a 'not-paid' payment record if the purchase order is approved
accounting.payment.purchaseorder.autocreate=Y

# create a 'not-paid' payment record if the sales order is completed and no payment exist yet.
accounting.payment.salesorder.autocreate=Y

[Mohd Viqar]

Anybody got any suggestion on how I can fix this bug. Any help is appreciated

[Sharan-F]

Hi Mohd

I've been taking a look into the code to give me a clue as to what was happening with the accounting entries. The good news is that your ledger issue isnt a bug ... it's OFBiz configuration.

You need to look at the GL Account Defaults for the Purchase Invoice. It shows the default accounts that will be used for each invoice line type.

In the demo data many of these line types including things like "Invoice Finished Goods Item (Purchase)" is set to use the Inventory Account. If you change it to use the "Uninvoiced Item Receipts" account, the accounting transactions will debit the correct account.

You will need to do it using the Global GL Settings because there is an account restriction on the Organization GL Settings that wont let you select the correct acccount. The Global GL Settings dont have any restrictions so you can select whatever account you want.

I'll update the Jira with this information.

I will also do more testing to see if the Payment isssue I identified is still open.

Let me know if you need any more information.

Thanks
Sharan