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    Jon Kelly
    Receipts on quantity based purchase orders
    Topic posted June 18, 2019 by Jon KellyBronze Trophy: 5,000+ Points, tagged How-To, Public Sector, Requisition Processing, Setup 
    57 Views, 4 Comments
    Title:
    Receipts on quantity based purchase orders
    Content:

    We use encumbrance accounting and have budgetary control enabled as well. Procurement team has issues with how the receiving works and getting money released on obligations. For example, a user creates requisition buying 1 item (good) for $1,000 and enters a receipt quantity of 1. When the invoice arrives, total amount is $979, which results in a quantity of slightly less than one. The obligation balance is not released with final close because now the quantity delivered is greater than quantity billed. We cannot find any easy way to ensure that the PO is closed and the remaining obligation is released back. We turned on settings to allow change orders on fulfilled orders, and tested an example. In that case, I can see in budgetary control where the amount was accounted as a credit, but the available balance of the funding source did not increase. 

    Working in higher education, we have many situations where departments need to use multiple funding sources for buying goods or services. There are some departments that use mostly project/award funding and may need to use 5-6 different award sources for a single item. This also seems to create issues when entering an invoice and a receipt. As an example, when entering a requisition line, the user chooses goods to buy 1 item for $5,000, and use distributions for a couple of sources for $1,250 on one funding source and $3,750 for another. When going to enter a receipt against the order, the user doesn't get a quantity of 1. Instead, they get two lines with a quantity of .382 and .618 each. More often than not, the invoice is slightly different than the order and it requires a lot of manual manipulation to have the distributions match the amounts on the order in conjunction with the receiving. We have some receipts that end up with decimal places going out 8-12 spaces. 

    Users don't understand why the system doesn't have a field/column that simply indicates "obligation balance" or something along those lines and why closing an order doesn't always release that obligation. Is there any advice on something we might need to change in our setups or process to prevent these types of issues? Thanks in advance for any input. 

    Jon

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    Comment

     

    • Suman Guha

      Moved from Purchasing forum.

      • Jon Kelly

        Just trying to understand how these pieces work together since this was moved from purchasing. We aren't using inventory, so I'm not sure why this question wouldn't be purchasing. Thanks!

        Jon

    • Suman Guha

      Purchase Order Receipts including desktop receipts or "My Receipts" is handled by the Logistics development team.

    • Peter Wolyniec

      In the first example, either the unit price on your PO is incorrect, or the supplier is invoicing you incorrectly. If the former, you need to make a revision to your PO and that should relieve your obligation and give you a match to your invoice. If the latter, there's no reason why you should be receiving, or getting billed, for a fractional quantity of a good.

      You should also consider using an amount-based line type for expense purchases i.e. instead of buying 1 x $1000, you buy 1000 x $1 (and receive against the 1000). This allows you to be much more granular in your receiving and invoice matching. This is commonly used for services purchases but can also be applied to expensed goods.

      Regarding the multiple funding sources, you should manage that with your PO distributions. If you match to a PO Schedule that has multiple distributions, the matched amount is automatically prorated across all the distributions on the schedule. If you match directly to purchase order distributions, amounts are allocated against only those matched distributions.