Consignment Inventory

The purpose of this page is to help you manage consignment inventory/product either as a consignee or consignor of inventory.

Consignment Summary

Consignment - Consignee General Discussion

Consignment - Bug Fix for Zero Cost

Consignment - Enhancement Fix for Doc Prepare

Consignment - Consignee Zero Cost Discussion

Consignment - Consignee Zero Cost Demo

Consignment - Consignee At-Cost Discussion

Consignment - Consignee At-Cost Demo

Consignment - Other Trigger Point AP Invoice Notes

Consignment - Consignment Installation Details

Consignment - Consignor Discussion

Consignment - Consignor Demo

NOTE: that you can import your Sales Orders as DocType = "Warehouse Order" and use "Generate Invoice" process to consolidate all orders into a single Customer Invoice if desired.

Consignment - Production with Raw Materials

Here is a discussion about consuming consigned materials as part of a manufacturing (production) process.

Consignment - Alternate using Separate Consigned Product Asset Account

Discussion - there are times when you want to treat consigned inventory just like other products in terms of ordering, receiving, shipping, etc.. This section shows you how. Scenario:

You order consigned goods.
You receive consigned goods.
You consume/sale consigned goods (either via production or sales)
You notify supplier of consumption.
Supplier sends and invoice for consumed goods.

Configuration:

Create an Account Element window => Element Value (GL Account) sub-tab record called "21191 - Not Invoice Receipts Consigned (NIRc)". This will be a liability with a debit sign, and it will act to offset the actual Not Invoiced Receipts (NIR) account (21190).
Create an Account Element => Element Value (GL Account) called "51401 - Inventory Clearing Consigned". This account will replace Inventory Clearing for all consigned product.
NOTE: Inventory Clearing should be an asset account. It represents the open balance of stocked product that has not been received. If you move Inventory Clearing to the balance sheet, please do the same for the Inventory Clearing Consigned account as well.
Create a Product Category called "Consignment"
Update the Product Category window => Accounting sub-tab => Product Asset field to point to the 21191 - NIRc account.
Update the Product Category window => Accounting sub-tab => Inventory Clearing field to point to the 51401 - Inventory Clearing Consigned account.
Create a new Product called "Consigned01" and assign it "Consignment" Product Category before you save the record.
Note, if the products are already created, you can use the Product Category window => Accounting sub-tab => Copy Accounts button to push down the defaults to all Products pointing to this Product Category.
Note: if you do not wish to use NIRc, you can alway replace it with a "Product Asset Consigned" account. The net effect will be the same.

Step 1: PO No accounting Step 2: MR Dr NIRc - $1000 Cr NIR - $1000 Step 3: Sell product Dr COGs - $165 Cr NIRc - $165 or Step 3: Consume Product via Production Dr Product Asset for finished good - $165 Cr NIRc - $165 Balance as of now: Dr NIRc - $835 Cr NIR - $1000 Reporting for consumed by not invoiced (NIR-NIRc) - $165 Step 4: Report to supplier and create vendor invoice Inv

Dr InvClearConsign - $165 Cr AP - $165

Match

Dr NIR - $165 Cr InvClearConsign - $165

Balance as of now: NIRc - $835 NIR - $835 InvClearConsign - $0 Conclusions:

NIRc is a liability account (natural credit sign) but maintains a debit balance.
Total NIR includes consignment.
Delta between NIR and NIRc is the consumed but not invoiced.
NIRc is loaned assed whose value is offset by NIR liablity.
To defend your balance sheet - run storage for consigned product - should tie to that product's NIRc
- note: can run for all consigned product or by product (using the Accounting Fact Detail window => Product field)

Please be quick to send an email to the mailing list with questions if you do not understand this section. This was created as a result of Anton's and Gaurav's contributions.