Inventory in Depth

This page holds the Inventory module’s mechanics in one place. The module page lists what the module does and does not do; this page explains why, and what to check.

Stock balance is not typed in anywhere. It is the running total of a signed stock ledger that the server appends to whenever a document with a non-zero quantity signum is finalised. Everything in this module either writes to that ledger, reads it, or prepares the paperwork around it.

This page is for the stock controller and the accounts person who makes the stock account agree with it: which documents move stock, what to do when a number looks wrong, and a check to run before a month is closed.

Applets in this module

Membership is an editorial judgement — the product has no module↔applet relationship in its data. Inventory owns 22 applets and all 22 are documented.

Looking at stock

Moving stock

Asking for stock, and planning it

The warehouse floor

Getting it to the customer

The documents that actually move stock

A document moves stock only if its server document type carries a non-zero quantity signum. That number is fixed in the backend, not an applet setting. Twenty-five document types have one.

    flowchart LR
  subgraph IN["Stock in (+1)"]
    PI["Purchase Invoice"]
    GRNSI["Purchase GRN <b>Stock In</b>"]
    SR["Sales Return"]
    SRN["Sales Refund Note"]
    TIN["Transfer In"]
    CGRN["Consignment GRN"]
  end
  subgraph OUT["Stock out (−1)"]
    SI["Sales Invoice"]
    CB["Cash Bill"]
    GINSO["Sales GIN <b>Stock Out</b>"]
    PR["Purchase Return"]
    TOUT["Transfer Out"]
    CGIN["Consignment GIN"]
  end
  ADJ["Stock Adjustment<br/>direction from the line"]
  CONV["Stock Conversion<br/>direction from the tab"]
  IN --> LEDGER[["Stock ledger"]]
  OUT --> LEDGER
  ADJ --> LEDGER
  CONV -.->|"built, not yet switched on"| LEDGER
  LEDGER --> BAL["Stock balance<br/>item × company × location"]
  NONE["Sales Order · Purchase Order · Quotation<br/>Stock Requisition · Delivery Order<br/>Goods Delivery Note · Packing Order · Jobsheet<br/>Credit Note · Debit Note<br/>plain GRN · plain GIN<br/>Invoice No Stock In / No Stock Out"] -.->|"no stock quantity"| NOTHING(["nothing reaches the ledger"])
  

What reaches the general ledger

Two kinds of document this module owns post a journal: the Stock Adjustment, and the consignment GRN and GIN — and the GRN and the GIN do not post to the same accounts.

The standard posting table has exactly seven journal handlers. This module’s documents use three of them — the stock adjustment handler, the consignment handler (the GRN) and the ordinary purchase handler (the GIN) — and a Reset MA posts through a path of its own. No document posts cost of goods sold. A sale posts its revenue and tax; cost of sales is the journal Month End Processing writes, described under What a stock movement sets off elsewhere.

What the module does not do, and what to do instead

A stock take counts; a Stock Adjustment changes the balance. The count compares counted against system, shows you a tolerance band and costs the difference. It writes nothing to the balance, and there is no “post variance” button. The route from a count to the ledger is a Stock Adjustment for each variance you accept: keyed in the Stock Adjustment applet, or loaded through its CSV File Import, which can create the adjustments as drafts for review. The Stock Take report exports to Excel in a different layout, so whoever loads the file rebuilds it in the import’s columns. The adjustment is what posts the journal.

There is no approval on a transfer or an adjustment. BigLedger’s approval engine covers Purchase Orders and Purchase Requisitions, is off until a tenant configures it, and causes FINAL rather than gating it. The Stock Requisition applet offers Approval Settings screens, but the document has no approval step to act on them. Control stock documents with permissions instead. On a Stock Transfer a role can be allowed to draft but not finalise; the Stock Adjustment applet has no such split, so give that applet only to the people who may write stock on or off, and review the adjustments listing.

That leaves the stock controller’s own job where it always was. Deciding what to count and when, running a count whose result you would sign, telling a loss from timing, writing off with a second person’s signature, cut-off at the month end and writing down stock that will not sell are all a person’s decisions. BigLedger does not make any of them. Counting Stock and Deciding What a Difference Means and Closing the Month on Stock say who does each one, when, and how they know they got it right.

Stock Conversion does not move stock yet. FINAL queues the conversion’s posting run, but the step that would write its stock lines is not switched on for any tenant, so the document says FINAL and the balance does not change. Until it is, re-pack or kit with a Stock Adjustment: one out for the components, one in for the kit, at the cost you decide. That is also the only way a kit carries its components’ cost; even once switched on, a conversion moves quantities, and each item keeps its own average. Read the conversion’s tabs literally: Input means into stock, Output means out of stock.

Available is not “balance minus reservations”. It is the balance plus a signed adjustment for open documents, and the adjustment can be positive. Open sales orders push it down; goods received but not yet invoiced push it up. A location can show more available than it physically holds, and that is correct.

The warehouse floor — what the Warehouse Management System applet records at each step, what moves the stock, and what the floor team should know before go-live — is on the applet’s page. Why a transfer takes two documents, worked through one load that arrives on two lorries, is on Stock Transfer.

Costing

Every balance row carries moving average and weighted average cost, plus last purchase cost and landed cost; FIFO is written only where the FIFO/LIFO subscriber job is enabled and by the rebuild. The LIFO, manual and replacement columns exist and are not maintained — nothing writes them, so a ledger line’s LIFO, manual and replacement cost is empty however the item is set up. Each screen decides which one it shows. Which one values your closing stock is a choice: the company’s Inventory Closing Base On setting, moving average when nobody sets it; LIFO, manual or replacement value it at zero. Month End Processing reads it for the cost-of-sales journal. How to choose, and what each choice costs, is Step 2 of Closing the Month on Stock.

In practice moving average is the one most screens use, and it is the one that bites:

• The Stock Take report values a variance at the location’s latest moving-average price. A FIFO tenant never sees FIFO cost there.
• A Stock Conversion, once switched on, carries no cost from components to kit. The kit arrives at its own last price at that location, which is zero for a new item.
• A transfer never changes the company’s unit cost. It can change the receiving location’s, and not in the way most people expect: the per-location average seeds from that location’s own last line, so a branch receiving an item it has never stocked values the arrival at zero.

Reset Moving Average, in the Stock Adjustment applet, is how a wrong average is corrected. It changes inventory value on the balance sheet and cost of sales on the income statement, so restrict it to finance.

When stock looks wrong, start from what you see

Most stock questions arrive as “this number is wrong”. Find the row that matches what is in front of you.

Checking the stock is right, before the month is closed

Each step below is a screen you open and a decision you make. The screens show you the gap. Closing it is somebody’s job, and each step says whose. Run the check in the first working days of the month, before Closing the Month on Stock and before anyone locks the period.

1. Nothing is on the road that should have arrived. Who: the stock controller. Open Stock Balance at each company’s L-SIT-<company code> location. Every quantity there should belong to a transfer that is still travelling, and the Stock Transfer Queue lists the same lines. In the Stock Transfer applet, Error Checking > Missing Queue for the month should list nothing; if it lists a document, tick it and press CREATE. Two mismatches mean something else. A Queue line with nothing at L-SIT… for that item was received by hand, without KO For: do not receive it again. And because Stock Balance shows only quantities above zero, an in-transit balance pushed below zero, by an inbound with no outbound behind it, simply disappears from it; Stock Report > Stock Movement for the item at the L-SIT… location shows it. You are done when every in-transit quantity matches a queue line you can name, and nothing is older than your normal delivery time. For anything older, receive it or find out why it has not arrived.
2. Every count you accepted has been written on or off. Who: the stock controller, with the second signature your write-off policy asks for. For each stock take session in the month, every variance you decided was a real gain or loss has a FINAL Stock Adjustment. Every variance you decided was timing has a note saying so. You are done when the session report and the adjustments agree, line by line.
3. Every adjustment carried its value to the ledger. Who: the accounts person. In Ledger and Journal, open Error Checking > Missing Journal. Run it for the month with Server Doc Type INTERNAL_STOCK_ADJUSTMENT, then RESET_MA, then INTERNAL_PURCHASE_GRN_STOCK_IN if you receive on GRN Stock In. Each row is a FINAL document that changed stock or cost and has no journal. Fix the company’s default GL code first, then select the rows and press Create. Create first deletes any journal already linked to the document, including one you keyed by hand and linked to it, so do not use it on such a document. You are done when the list is empty, or every row you created shows SUCCEED in Remarks. A row that shows an error code, or nothing, saved no journal: open that document in Trace Document, fix the cause and press Create again. If Month End Processing has already been run for the month, run it again once the journals exist (see What a stock movement sets off elsewhere, below). This list cannot see a journal that posted short, with some lines missing. That happens only when a line resolves no GL code at all, so mapping both company defaults, STOCK_ADJUSTMENT and STOCK_BALANCE, before the first adjustment is what prevents it.
4. Purchases and sales agree with the ledger. Who: the accounts person. In Financial Report, open Error Checking > Stock Flow Report for each company and the month. It has one row each for purchases, purchase returns, sales, sales returns, purchase consignment and Reset MA, and each Difference should be zero. Click a Difference that is not zero, select the rows marked MISSING_ACCOUNTING or WRONG_AMOUNT, press CREATE, and read the Status column it writes back. The report has no row for stock adjustments or GRN Stock In, which is why step 3 exists, and a difference on the Reset MA row is repaired in step 3 too: its listing cannot show Reset MA journals. You are done when every Difference is zero, or you can name the document behind it.

Then close the month with Closing the Month on Stock.

What it touches elsewhere

What must exist first

What a stock movement sets off elsewhere

• The general ledger, and when the stock account is right. Of the stock documents, a Stock Adjustment and a Reset MA post to the stock account when they are finalised; a GRN Stock In and the consignment documents post journals of their own. Cost of sales is made at month end. Month End Processing takes closing stock from the stock ledger, at the company’s Inventory Closing Base On (unless someone has typed a manual closing value), and writes the journal that brings the stock account to that figure. It takes the month’s adjustments and Reset MA from their journals. That decides what a missing adjustment journal does:

  • before Month End Processing, the stock account is off by the adjustment’s value;
  • after it, the stock account is right again, but the adjustment’s value has landed in cost of sales instead of the adjustment account. Profit is the same; the split is not;
  • if you create the missing journal after Month End Processing has run, the value is counted twice and the stock account is off again, until you run Month End Processing for that month once more. A re-run deletes its own journal and writes it again.

  So run step 3 of the check before Month End Processing, not after.

• Selling. The figure to promise from is available, not the balance. An open sales order or a reservation lowers it while the stock is still on the shelf, and a draft document holding a serial number keeps that one unit from a second sale.

• The marketplace. The E-Commerce module derives each marketplace’s quantity from this balance, minus open marketplace orders, and writes it to its own table rather than back into the balance.

Choosing between two neighbours

What one wrong setting reaches

• A missing STOCK_BALANCE default GL code on a company leaves every stock adjustment of that company that carries a value with no journal, while the stock moves as normal, and Month End Processing writes no cost-of-sales journal for that company either.
• No outbound-to-inbound document-flow configuration on a company means no outbound transfer of that company can be received through KO For.
• A back-dated purchase rewrites the cost on the document lines after it, so a margin you reported last week can change.
• A Reset MA changes the stock value on the balance sheet and cost of sales on the income statement. Keep it with finance.
• Choosing the L-SIT… location on a transfer is not refused. The in-transit balance then stops meaning “goods on the road”, and step 1 of the check stops working.

What it is used with

Stock Take, then a Stock Adjustment for each variance you accept. An outbound transfer, then an inbound raised through KO For. A Stock Requisition, then the transfer raised against it. The check above, then Month End Processing, then the period lock.

Read next

• Inventory Module — the capabilities and limits at a glance, and every page in the module.
• Counting Stock and Deciding What a Difference Means and Closing the Month on Stock — the stock controller’s and the accounts person’s jobs, step by step.
• Core concepts and Costing internals — the ledger, the signum and the cost bases in more depth.