Returning Inventory Before the Final Invoice is Processed

When inventory is received on a delivery note, no costs are posted to AP and the amount is stored in the IR/AP clearing account in GL pending the finalization of the transaction. When the final invoice is processed in IR the costs are removed from the clearing account and posted to the Vendor AP Account. This will include any cost differences between received and invoiced costs.

When returning inventory for which no invoice has been received, the system can not determine the final adjustment costs and can therefore not accurately process the cost portion of the return as "residual" costs may remain in both the clearing account as well as the item record in Inventory Control. To avoid such a situation, IR does not allow a return of costs when items are returned prior to the final invoice being processed. To return goods when the final invoice has not been processed, follow one of the following procedures:

1. Turn the receipt into an invoice using the "Process invoices/cost adjustments" function. Recall the receipt and post it with no changes. The system will display "No changes were made to vendor xxxxxx. Do you want to post the delivery note amount as the final invoice amount?". Post the invoice and then do the return. When the final invoice is processed the system will treat it as an adjustment to the receipt rather than an adjustment.

2. Process the return with no values attached. Process the invoice as normal when it is received and then process a return with only values. On the detail screen select "No" in the "Returned" field.

3. Process the return with no values attached. When the invoice is processed, set the value of returned to the value of the remaining inventory or zero if all stock has been returned. This will adjust the value accordingly. This method can only be used if you have selected to post costs to remaining inventory in the housekeeping option "Cost adjustment allocation".

4. You could of course return the inventory using a Quick Return by not associating the return with the receipt. This will allow you to return the goods with associated value and you will then need to track the adjustments manually.

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