Based on discussions with Support (case 4686101), Sage acknolwedges that even though this report does not always agree to the GL, the system is "operating as designed", hence the need to put this as an "Enhancement request".
Just to put this in context, this problem arose for my client during their year end audit. The auditors were less than impressed that this problem occured and questioned the integrity of MAS90 as a whole.
The following is an excerpt from an email I sent my client explaining how/when the problem arises:
One possible cause I’ve been able to identify is when (with numbers to illustrate):
1. Goods on a PO are received Qty-1000, PO Unit Cost = $10ea
2. The subsequent invoice is received for 10 of the items received, but not all, at a price which differs (higher typically) from the original, 15.00 each.
What occurs in the GL is:
Re 1. An accrual is established in the Purchase Clearing report for 1000*10=$10,000
Re 2. When the invoice is received in at a DIFFERENT price than the PO price indicated and accepted (there is a warning that this occurs), the Purchase Clearing account is reduced by the extended value of the invoiced amount. In this example, the debit to account 2008 would be 10*15=150.
Technically, this is wrong—the price variance of (15-10)*10 units =$50 should be a purchase price variance which could/should be capitalized to inventory if on hand, or expensed if the items are already sold. Fortunately, this issue will be resolved as explained shortly.
The next issue is that the price on the PO is automatically adjusted to the price the goods were received at; in this example, $15.00 ea, This unit price is used to value the units that appear on the Purchase Clearing report; in this example, the report would now show 990 units at @$15 ea.=$14,850, which is 14850-990=13860 different than what is in the GL account.
Once all the goods are received, the correct purchase price variance is calculated by the system, written off to the applicable GL account, and the Purchase Clearing account is adjusted properly down to 0 for the transaction.
by: Brian C. | over a year ago | Sales & Distribution
Comments
Yes, it is working as designed. Was designed way back in the early 90's or even before. I sent a very detailed note to them in 1999 outlining the issue. Received a similar response. There were several other issues that may or may not have been corrected. At one time, if you posted an inventory transaction as a receipt, the offset was to the purchases clearing account.
These are major issues and I Sage should address it as outside accountants do not trust the integrity of client data when the system does not work properly. Once an item is received via PO receipt of goods, the unit cost should not be allowed to be changed on a PO. Then they should address the receipt of goods through inventory as well. I tell clients not to use the receipt of inventory under inventory transaction.