It’s that time of year again! Inventory control personnel may start planning for a physical count and the accounting world prepares for the year end close. What should you be considering for the year-end close in the Inventory and Manufacturing modules? Following are some simple steps to ensure your close runs smoothly.
Know when to run the Inventory Year-End Closing
The year-end close process in Inventory does not have an “as of” date function. It must be run at the end of the fiscal year, after all transactions that could affect inventory for that year have been posted and before any new transactions that could affect inventory are posted.
Know what to expect
The year-end close process will always:
Transfer inventory summaries from Current Year to Last Year.
Update each item’s Beginning Quantity, from the Quantity on Hand, at each site. This is used for Inventory Turnover reporting.
Reset the Quantity Sold field to zero in the Item Quantities window for each site.
The year-end close process provides an opportunity to:
Remove discontinued items
Remove sold purchase receipts
Remove lot attributes for sold lots
Update standard cost based on current cost field (for environments without Manufacturing only)
Prepare for Year-End Close
Conduct full physical inventory and update quantities in GP before actual year-end or establish a strong cycle-counting program
Run SOP, POP and Inventory Reconciles as well as the Inventory Check Links monthly to maintain solid data consistency throughout the year
Prepare users for a year-end push to complete all year to date inventory adjustments, receipts and invoicing.
Determine how to handle new year transactions without posting.
(Manufacturing) Determine what new standard costs should be entered for the upcoming year
(Manufacturing) Discuss cutoff dates for removing Archived BOMS and Closed/Canceled Mfg Orders