If you run Vinsight as your master record for inventory, your inventory transactions can be sent to your accounting system so that your inventory asset accounts are accurate.
In this document:
Using Vinsight as the master record for your inventory has benefits such as deep integration with the production and sales processes to help planning and availability functions.
The way that the process is designed is that Vinsight keeps records of what items you have, how many you have and at what locations and their value. Your accounting system would show the total asset value in a small number of current asset ledgers so that your balance sheet is accurate. Vinsight will not generally sync items and inventory quantities to your accounting system just current asset valuations.
To facilitate this, all stock items and work in progress in Vinsight needs to have an asset ledger code set against it, either by using a spreadsheet importer or editing individual stock items.
Current Asset Accounts
We recommend you split your inventory in to several current asset accounts that represent the departments or stages of production eg:
Another benefit of having them split up functionally like this, is that it allows isolating stock counting variances in ledgers that are more likely to assigned to different staff members so gives them some authority and responsibility for their own inventory.
You must start with Vinsight and your accounting system agreeing on a value. Do a physical stock count and adjust your opening stock in Vinsight to match this count. Have an agreed per unit “Standard Cost” value that is loaded into Vinsight. Run a stock on hand report in Vinsight and group it by ledger, your accounting system’s current asset ledger should agree or you should do a one of journal to make them agree.
Purchasing any inventory items and posting the purchase to our accounting system should increase the inventory in Vinsight when your receive the items, and increase the current asset ledger in your accounting system.
If you use dry goods or work in progress (WIP) to create finished items, then the bulk operations or the packaging operations in Vinsight will be decreasing and increasing the value of the relevant items inside of Vinsight. In Vinsight you must run and post Bottling Journals to your accounting system so that the Bulk WIP and Additives ledgers are decreased (credited) and the Finished Items asset ledgers are increased (debited).
When you sell (and deliver) inventory items, the quantity of inventory in Vinsight decreases, to expense the value of the asset and reduce your inventory and increase your cost of sales expense, in Vinsight at the end of the month, you must run and post the “Cost of Goods Sold” journal and post it to your accounting system.
The inventory balance in Vinsight can be seen at any time using a Stock on Hand report.
Fundamentally inventory balances at the end of a period are the result of a simple formula:
Opening Balance
+ Purchases
+ Inventory Created from production
– Inventory Consumed in production
– Sales
= Closing Balance
This formula represents the steps in this document, so if your closing balance does not match your physical count then it is a matter of investigating if any of the steps have been missed (eg: items shipped but not marked as such) or only partially completed (eg in-complete shipment), or happened in a different accounting period (eg shipped now but dated next week by mistake).
Useful audit tools are reports like:
Stock Items Movements report (delivery quantities and timings)
Orders over or under delivered report (anomalies or orders that may not yet have been delivered or mis-delivered etc)