Item requirements NOT used on the project
When the Item requirements are not used on the Project, then at the time of Project PO receipt postings, cost is not consumed on the project. Please find below the postings at the time of product receipt and supplier invoice.
PO created for an Item A for GBP 4000.
PO receipt postings
Dr Cost of purchase material received 4000
Cr Purchase accrual 4000
PO invoice posting
Dr Project Cost 4000
Project WIP cost item 4000
Purchase accrual 4000
Cost of purchase materials invoiced 4000
VAT 800
Cr Stock Issue 4000
Project cost item 4000
Cost of purchase material received 4000
Supplier 4800
Stock Issue posting is taken from:
Item requirements used on the project
When the Item requirements are used on the Project, then at the time of Project PO receipt postings, cost is consumed on the project. Please find below the postings at the time of product receipt and supplier invoice.
PO created for an Item A for GBP 4000.
PO receipt postings
Dr Cost of purchase material received 4000
Project WIP cost item 4000
Project Cost 4000
Cr Purchase accrual 4000
Project cost item 4000
Cost of units invoiced 4000
PO invoice posting
Dr Purchase accrual 4000
Cost of purchase materials invoiced 4000
VAT 800
Cr Cost of purchase material received 4000
Supplier 4800
Cost of units invoiced posting is taken from:
If you compare both the postings you will notice that the postings are almost the same other than timing of them getting posted in the system.For the product receipt posting where the item requirement is used, the additional posting of the project costs are the ones which are posted normally at the time of invoicing when the item requirement is not used.
Thanks
Sarang
When the Item requirements are not used on the Project, then at the time of Project PO receipt postings, cost is not consumed on the project. Please find below the postings at the time of product receipt and supplier invoice.
PO created for an Item A for GBP 4000.
PO receipt postings
Dr Cost of purchase material received 4000
Cr Purchase accrual 4000
PO invoice posting
Dr Project Cost 4000
Project WIP cost item 4000
Purchase accrual 4000
Cost of purchase materials invoiced 4000
VAT 800
Cr Stock Issue 4000
Project cost item 4000
Cost of purchase material received 4000
Supplier 4800
Stock Issue posting is taken from:
 |
| Stock management > Setup > Posting > Posting |
Item requirements used on the project
When the Item requirements are used on the Project, then at the time of Project PO receipt postings, cost is consumed on the project. Please find below the postings at the time of product receipt and supplier invoice.
PO created for an Item A for GBP 4000.
PO receipt postings
Dr Cost of purchase material received 4000
Project WIP cost item 4000
Project Cost 4000
Cr Purchase accrual 4000
Project cost item 4000
Cost of units invoiced 4000
PO invoice posting
Dr Purchase accrual 4000
Cost of purchase materials invoiced 4000
VAT 800
Cr Cost of purchase material received 4000
Supplier 4800
Cost of units invoiced posting is taken from:
 |
| Stock management > Setup > Posting > Posting |
One other difference is the use of 'Cost of units invoiced' instead of 'Stock Issue' at the time of posting the receipt when the 'Item requirement is used. The reason the posting is taken from Sales Order section is, Item requirement creates a SO in the background to get this cost posting on to the project. It replaces the 'Stock Issue' posting highlighted in RED above with the 'Cost of units invoiced' .
Latest update (29th July 2019)
The above postings are seen when the costs are set to go to 'Balance'. If the costs are set to go to 'P&L' then the following postings are seen for "Item requirements used on Project":
The interesting thing is though this is an 'Item' type of posting, no posting is to be set for 'Cost - item' and 'WIP - cost value - item'. Ideally, as the project 'Item' costs are set to go to 'P&L' but still no postings are posted, in this case, to 'Cost - item'. Does anyone know whether what i have inferred based on my testing, is correct or not? Please let me know if I am wrong here.
One more interesting thing is, on the 'Stock' posting side, even though postings are not required for 'Purchase expenditure for expense' and 'Purchase expenditure, un-invoiced' system still demands it. I got rid of this issue by setting an error / temporary account (which is out of reporting range).
If I get any further information on this topic, will update.
Latest update (29th July 2019)
The above postings are seen when the costs are set to go to 'Balance'. If the costs are set to go to 'P&L' then the following postings are seen for "Item requirements used on Project":
PO receipt postings
Dr Cost of purchase material received 4000
Project Cost 4000
Cr Purchase accrual 4000
Cost of units invoiced 4000
PO invoice posting
Dr Purchase accrual 4000
Cost of purchase materials invoiced 4000
VAT 800
Cr Cost of purchase material received 4000
Supplier 4800
Dr Cost of purchase material received 4000
Project Cost 4000
Cr Purchase accrual 4000
Cost of units invoiced 4000
PO invoice posting
Dr Purchase accrual 4000
Cost of purchase materials invoiced 4000
VAT 800
Cr Cost of purchase material received 4000
Supplier 4800
The interesting thing is though this is an 'Item' type of posting, no posting is to be set for 'Cost - item' and 'WIP - cost value - item'. Ideally, as the project 'Item' costs are set to go to 'P&L' but still no postings are posted, in this case, to 'Cost - item'. Does anyone know whether what i have inferred based on my testing, is correct or not? Please let me know if I am wrong here.
One more interesting thing is, on the 'Stock' posting side, even though postings are not required for 'Purchase expenditure for expense' and 'Purchase expenditure, un-invoiced' system still demands it. I got rid of this issue by setting an error / temporary account (which is out of reporting range).
If I get any further information on this topic, will update.
Thanks
Sarang
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