Dears,
We have a suggestion which can be considered as advance feature in terms of handling COGS and Revenues recognitions (this feature available in SAP, Oracle, Odoo, MS AX and GP).
Current behavior:
| Trx | Date | Reference | GL Account | Dr | Cr |
|---|---|---|---|---|---|
| Delivery Note | Feb-2020 | DN-0001 | COGS - Expense | 900 | |
| Delivery Note | Feb-2020 | DN-0001 | Stock | 900 |
In most cases, our invoice related to the above should be issued within the same period that COGS recognized and by means we have to recognize the Revenues related in the same period. But in our case, most common invoices are not being issued within the same period due to a long procedure of our customers as most are contractors.
So, the revenues recognition (Sales invoice) of the above might be made after 2-3 months…hence, if you look our P&L, it won’t be reflecting the best values should be as it presenting COGS without having Revenues related which we don’t want to have.
Therefore, and based on our experience with other ERP platform, we highly suggest you to adopt the advanced method and to make is as option in accounting setting.
Suggested Behavior:
| Trx | Date | Reference | GL Account | Dr | Cr |
|---|---|---|---|---|---|
| Delivery Note | Feb-2020 | DN-0001 | **Temporary account or Interim (Balance sheet) | 900** | |
| Delivery Note | Feb-2020 | DN-0001 | Stock | 900 |
The above will not have an impact on the P&L statement, and shall be treated as below while issuing the related invoice:
| Trx | Date | Reference | GL Account | Dr | Cr |
|---|---|---|---|---|---|
| Sales Invoice | Jun-2020 | SINV-0001 | Debitor | 1500 | |
| Sales Invoice | Jun-2020 | SINV-0001 | Sales | 1500 | |
| Sales Invoice | Jun-2020 | SINV-0001 | COGS | 900 | |
| Sales Invoice | Jun-2020 | SINV-0001 | **Temporary account or Interim (Balance sheet) | 900 |
- With the above, COGS and Revenues were recognized within the same period
- Temporary/Interim account is closed
- COGS is visible to be read within GL related to the invoice
Hope the above to have it in your roadmap for the next updates V13 by making this feature as optional to users.
Regards,
Yahya