Microsoft Office Accounting Professional 2008

Using goods received notes

If you use stock products, it is important to record them into Office Accounting as soon as they arrive, so they appear as stock on hand and can be sold. The Goods received note makes it possible to record the products into stock, even if you haven’t received a final purchase invoice from your supplier.

Sample Goods received note

The goods received note is unique in many ways:

• The goods received note can be the first step in the purchase flow or the result of a purchase order.
• Goods received notes adjust stock quantity and cost, so the products are available for resale.
• The goods received note is a financial transaction, but since the purchase invoice from the supplier hasn’t arrived, it posts the liability to pending goods received notes rather than purchase ledger. This means that the supplier balance isn’t changed by receiving products.
• A goods received note can be created from a purchase order but it should only reflect the actual products received if the quantity differs from what was ordered. A purchase order can be received in one or more deliveries (i.e. if only part of the order arrives), so you can create multiple goods received notes from the same purchase order.
• You can create a purchase invoice from a goods received note. This will void the goods received note and create a purchase invoice in its place with the correct cost for each product.
• When the Show prices with VAT checkbox is checked, all amounts are treated as being VAT-inclusive (if the supplier lists their prices with VAT).

Goods received note Postings

As you can read between the lines above, the goods received note is a temporary document to ensure that the financial stock and physical products in stock are accurate from the moment when the products are received until the moment the purchase invoice is issued.

The goods received note will:

• Debit the stock asset account with the quantity and cost of the products net of VAT
• Credit pending goods received notes account for the net amount on the goods received note

Note that even though the goods received note contains VAT amounts, no VAT postings are made. It is not permitted to deduct VAT until a proper VAT invoice is received from the supplier.

The function of the pending goods received notes account is to capture the liability incurred by the receipt of the products, without messing up the aging and balance on purchase ledger for the supplier.

The Audit trail for the goods received note above is depicted below: