Parts Stock v Nominal Ledger

Unless you use the GRNI (Goods Received Not Invoiced) there is no link between the Nominal Ledger and the Parts Stock file.

The system works around Average Cost – so if you buy one item at stock order discounts and another at VOR then the system adds them together and divides by 2 to get the average cost price. So when you sell one the cost of sale price that the system processes (the average cost) will be higher than the actual and in the case of the other it will be lower than actual.

So during the course of the month there will be variances occurring that will add up over time.

So that your accounts reflect your actual position rather than the average position, there is a monthly routine to go through.

Print the Stock Evaluation Report 

• Click Parts 
• Click Reports 
• Click Efficiency
• Click Stock Evaluation 
• Tick 'Print Product Group Totals' 
• Select 'Totals only'
• Click OK

The report will print the below headings inc the Period Number

This report then needs to go to the accounts dept. to correct the difference by a journal in the nominal ledger.

The difference is likely to be a few hundred pounds and would be normal if 1% – 2% of stock value. Journal the difference to Stock Adjustments in P&L account and force the nominal ledger to agree with Stock Evaluation Report.

If you don’t do this on a monthly basis the annual adjustment will be a lot larger and you will be reducing profit you thought you had made. Also the difference will just get bigger each month.

You may find that it fluctuates so that one month you adjust up and another you adjust down.

If the difference is outside these parameters, then your Parts Manager needs to look through the entire 'Stock Evaluation' report to see if he has booked in too many parts or a wrong part i.e. 10 engines instead of 1 

But always find the difference or you may find you have stock with legs.