Misc Stock System V2 Overview

Misc Stock is defined as stock you don't normally stock but buy in on as required basis from your suppliers

In a perfect world you

• Raise a procurement for X of a Misc stock item through our Sales Order screen.
  
• You order it from a supplier
• You receive this stock in from your supplier
• You update the Sales Order (ie Invoice the customer) using the same qty & a cost what you were invoiced from your supplier.

Sadly in reality this doesn't happen

• The sales staff Order X from the supplier but Invoice out Y to customer
• The sales staff put a Cost on the customer Invoice but the true cost comes in at Y
• The sales staff start a Procurement, Order the stock, then delete customer's sales order
• I am sure you can all think of many other horror scenarios that you have seen with your staff.

Without a very managed process of dealing with Misc Stock you will end up with
Financial losses on some sales incurred because staff have not ensured the sale price to the customer relates to the true cost from your Supplier.

A stack of "Odd Ball" products sitting at the back of the warehouse that :

• Who the heck ordered these from our supplier ?
• No ones knows why they are there ?
• When did we buy them ?
• Who were they for ?
• What did they cost us ?
• What do we do now with them now ?

A common error
Every business wants to improve their bottom line each month, part of this is to invoice out everything at the end of the month. So Misc stock gets invoiced out despite us having the Suppliers invoice to triple check the cost and selling price to the customer on the Sales Invoice.

Whilst our Misc stock system cannot stop all these errors at the very least it makes management aware they are happening so they can fine tune their staff processes to reduce the errors.

The New Misc Stock System V2
Is a significant improvement on the first version (v1) as it addresses some things you could not easily do in the original version.

It makes it easier to deal when staff return (credit) Misc stock
It makes it easier to deal with situations when the Qty on the Sales order differs from the Supplier qty
It makes it easier to deal with moving a Misc item to a different Sales Docket (Transfer)

Misc Stock System V2 Best Practice

Keep your Misc Codes short !
3 or 4 Characters is recommended, this might mean you creating new ones
ie ZZT for Misc Timber & ZZH for Misc Hardware

Their Stock Type should be M=Miscellaneous Stock,
The Misc Stock codes should *NOT* have any costs or Sell prices

You should have at least one in each Franchise, so may need 10 - 20 Misc Codes defined in your Stock system. This will make your Sales reporting and the Analysis correct in your GL

Processing Misc Stock On A Sales Order
Using the appropriate Misc Code load onto your Sales order replacing the description with what the goods requested are. Also ensure you have the correct cost you are expecting from the Supplier.

Procure the Misc Stock to the supplier, noting you may be procuring more than one item to the same supplier on the same Procured Supplier order.

Once you have done this you can Confirm the Sales order which will create the Supplier Order ready for updating to the supplier.

Note 1:
When you Procure the Misc Stock Item your Misc Code on the Sales Order will change ie if the Misc code was ZZT (Misc Timber) the Code will now shows as ZZZT^^AAAA Where AAAA is a Random code. This will also automatically create a new Stock Item in the Stock system called ZZZT^^AAAA

This code ZZZT^^AAAA will also be the one that will show on the Supplier's Order

Note 2:
You cannot manually order Misc Stock thru the Stock Ordering system, all Misc Stock must be linked to a Customer's Sales order.

Note 3:
You cannot put Misc stock onto a Customer's Sales Order and update it without first Procuring it.

Note 4:
Whilst the original Misc Stock Codes in your stock system never have stock onhand the codes created ie ZZT^^AAAA are in your stock system as a Normal Stock item, they do have Stock onhand if the Qty Received from the Supplier does not match what is invoiced out.

Once The Stock Is Ordered To The Supplier
Only after the stock is ordered with the supplier can the Customer's Sales Order be Invoiced and updated. In a perfect world you would not do this until your have received the Supplier's invoice but for a 1000 reasons your staff do this daily.

Obviously once the Supplier order is updated & sent you can receive in the Misc Stock and receive the Invoice from the supplier for those goods like any other stock.

Misc Stock System V2 Reporting

There are two main methods of reporting Misc Stock

Method 1
Under General Stock Reports you can select an OnHand report (Say Report #2) then on the selection screen where you select the Groups or Group range there is an option to select the "Misc Stock Rule"

Selecting that (and leaving it to show all stock Groups) will show all Misc Stock OnHand

If there is a Positive Stock OnHand it and Now Sales this would indicate the stock has been received in but nt Invoiced out.

If there is a Negative Stock OnHand it and it shows Sales this would indicate the stock has been invoiced out but we have not processed the stock has been received from the supplier.

Method 2
Under The Main Stock Reports Menu is a report called "Misc Stock 2 Summary"

Here you can to show all Misc Stock with a Balance (see Mode 2)

This will show you all Misc Stock where there is a balance
(Remember in the perfect world there should be none)

Notes:

• This is a VERY busy screen, and you will need a widescreen monitor to view all the columns.
• Any rows where the Rcvd, Inv Line qty & Balance show in Pink indicate a problem.
• Rows with these columns not in pink indicate either the Sales Invoice has not been processed or the Suppliers P/Slip has not been received.
• On The RHS there is an option to Writeoff the balance of stock which will automatically create a Stock Adjustment Batch for you to post.
• Our very strongest advice is never ignore the errors, always deal with them daily or at worse twice a week.
• NEVER let the Misc Stock report grow in entries !

Misc Stock System V2 Can Sell / Can Order

Can Sell, Can Order rules
In a perfect world you only ever order a Misc Stock Item once from a supplier and Invoice a customer once !

So

Once the ZZT^^AAAA has been invoiced out the "Can Sell" flag is set to prevent it being resold because it should never happen. If however you end up with a balance ie the original customer decided to not take all or some of the stock (Credited back) then you can change the flag and resell it.

And

Once the ZZT^^AAAA has been ordered the "Can Order" flag is set so you cannot reorder as it would be illogical to reorder more (you should start a new Misc Stock line on a new Customer sale order)

Misc Stock System V2 Effect On GL

In The General Ledger along with your Stock onHand Gl Accounts (in Current Assets) we have GL Code/s for your Misc Stock

The Value in these will equal the value of Misc Stock in total you have OnHand (see Misc Stock Reporting) Every Night (no exceptions) these are recalculated to ensure perfect balance between Misc Stock and the GL

In a perfect world the value of misc Stock OnHand is zero so there should be none so there should be none in your GL, but here are examples of where there is some at the end of each Financial Period.

Example 1
You Procure Misc Stock for a new Bulldozer for a Customer for $500k, when it comes in and you process the stock Receipt you will now have a Misc Stock in your GL for $500k

If you customer does not want to be invoiced until the 1st of next month you have a Bona Fide asset for 500K sitting on your balance sheet until you can invoice it out in the new month.

Example 2
You Procure Misc Stock for a new Bulldozer for a Customer for $500k, it's the last day of the month, it's been delivered straight to your customer but you have not got the paperwork.

If you Invoice it out to the customer you now have a Negative Misc Asset in the GL which compensates for not having a value in Creditors etc for the debt unpaid.

Of course when you process the Invoice from your supplier Creditors will be updated and the value of the Bulldozer under Misc Stock will be zero and we are back to our "Perfect World"