Various types of receipts are handled by the Receivings Processing application.  It is not necessary, for instance, to use different procedures for purchased materials and expense items (supplies).

Material arriving at the receiving area is normally accompanied by a packing slip, invoice, advice note or similar document indicating the original purchase order number, the item number and the quantity shipped.  If this documentation is missing or erroneous, the Receivings Processing application provides a means of identifying the purchase order number and the numbers of the items that were delivered.  For instance, if you only know the vendor number and vendor's item number, you have the option when entering the purchase order number or pressing a function key that brings up a screen upon which you enter the number of the vendor and the item.  The program then lists on the screen all purchase orders upon which this item was ordered from this vendor, enabling you to choose the appropriate one.  The application is designed to make it as easy for you as possible to match the receiving with the correct purchase order and item.

 For routine shipments and shipments which fill the purchase order there is a function available that allows for very rapid entry of the receiving.  This feature automatically displays successive lines on the purchase order and allows the entry of the quantity received, disregarding entries for other fields.  Most shipments would be eligible for this type of entry so using it can make the entry of receiving a very quick and simple operation.

 The package will compare the receipt date with the request date and display a warning if the receipt date is earlier than the request date by a margin larger than company policy allows.  Over‑shipments are handled in the same way.  In each case the message advises the operator to notify the person responsible for authorizing such shipments before continuing with the entry.

Batch vs. On-line Receivings Processing

 Receivings Processing has the flexibility to run two different ways.  It can record receivings in batches which are posted in a separate step.  This allows for distributions to multiple G/L accounts.  It can also update the necessary files immediately (on-line) when transactions are entered.  This capability keeps your Inventory records as up‑to‑date as possible while still providing you with an audit trail of each receiving.

 The flag that determines if you are using batch or on-line processing is in the P/O Setup application.  There is a similar flag in the I/M Setup application that controls how transactions are handled in that package.  These two flags should be set for the same type of processing to avoid errors in distributions.

    Receivings Accrual Account

 If batch processing is being used, you must enter a Receivings Accrual Account number in the P/O Setup application.  This account is used to hold the value of received inventory until the invoice is entered in Accounts Payable.  The account is "global" in the sense that it is not tied to individual purchase order line items.  All received inventory is held in one account.

 When distributions are created in batch receivings processing, the accrual account will be credited and the inventory asset or expense account will be debited.  When an invoice is entered in A/P Transaction Processing, the accrual account will be debited and the A/P account credited.  For more information on batch and on-line receivings, see the Receivings Processing section of this manual.

 The following T-Accounts illustrate the debits and credits described above.  When batch receivings are posted, the following accounts are affected:

When invoices are entered in A/P Transaction Processing, the following accounts are affected:

If you are not validating account numbers from Elliott's G/L package, make sure you define the accrual account number in both the I/M Account File and the A/P Account File.

 During posting in the Post Receivings Transactions application, G/L entries for the inventory asset or expense and accrual accounts will be created in the I/M Distribution File.

Item/Vendor Relationships

 Many vendors can be suppliers of the same item.  Conversely, a single vendor can be the supplier of many items.  When you order material from a vendor they normally require you to use their item number, not your own, to identify the purchase.  The Purchase Order Processing application allows you to specify the items that a vendor supplies by both your item number and the vendor's item number.  This information automatically updates the Item Vendor File Maintenance application and is available to many of the applications in the package.  For instance, you may identify the line on a purchase order to which a receiving corresponds by using either your item number or the vendor's item number.  Since documents that accompany the shipment seldom reference your item number, this feature makes the receiving process easier and faster. 

Ship‑To Addresses

 Even small companies can have more than one shipping address.  The Purchase Order and Receiving package allows as many shipping addresses to be stored on file as you would ever want.  Each shipping address is accessed by a 4‑character code.

 There may be several inventory locations at each shipping address.  The package allows you to set up Ship‑to codes for each inventory location at each shipping address.  When you specify the shipping address for a purchase order you are consequently specifying the inventory location for which the material is intended.  

Purchase Order Inquiry

 Once a purchase order has been entered, printed and sent to the vendor, there are several means by which a buyer, purchasing agent, department manager, shop foreman or other interested party can observe the progress of receiving against the order.  The most convenient way to do this is through the purchase order inquiry.

 This program allows access to every purchase order on file and displays general order information such as the shipping address, terms, shipping method and order date.  Following the display of this data the screen shows detail of each purchase order line, including such information as the quantities ordered, received, rejected and invoiced.

Purchase Order History

 The inquiry program is useful for keeping track of active purchase orders. Once a purchase order has served its purpose it is closed, then deleted. Historical information is kept for orders that have been deleted. This information includes the purchase order number, the vendor number and detail for each of the lines on the order.  The line data includes the date the item should have been delivered, the date it actually was delivered, how much was ordered, received, rejected and canceled, and the expected and actual prices for the item.

 This information, which is available on reports, is designed to assist you in evaluating the performances of vendors, as well as the performance of specific buyers and the overall performance of your purchasing department.  

Vendor Analysis

 Another, more specific means of evaluating vendors is available.  The Vendor Performance Analysis Report bases its evaluation upon statistics stored in the Vendor file in the Accounts Payable package.  Relevant statistics include the value of purchase orders year‑to‑date and last year, the total number of purchase order lines and the number of lines that the vendor had late deliveries for, the extent to which the vendor has billed the items at a cost different from the price specified on the purchase order and the vendor's rejection rate.

Cash Requirements Projections

 Cash required for the payment of a vendor can be calculated as soon as the purchase order has been printed.  The package knows how much was ordered, at what price and when to expect the bill (at about the same time as the receiving).  The package also knows the vendor's terms so it knows when the invoice will be due.  With this data to hand it is a simple matter to anticipate when the cash payments must occur and how large they will be.

 The Cash Requirements Projection Report calculates the amounts that must be paid to each vendor over four periods (which you define).  These amounts are derived from unreceived purchase order lines, unbilled receiving and unpaid invoices in the Accounts Payable Open Item file.  For each vendor, the report shows the cash requirements for purchase orders and for accounts payable separately.  The report then shows the total aged cash requirements from both sources.

 Since both purchase order and accounts payable sources are utilized, the report can give a very accurate projection of your case requirements over the next few weeks or months.  How long a period of time the projection will be useful for depends upon the frequency with which purchase orders turn over in your company.

Serialized Items

 Serial numbers for items are supported by the Inventory Management, Purchase Order and Receiving, and Customer Order Processing packages. The user has the flexibility of stocking serial numbers for items or only assigning serial numbers to the item when it is sold or issued.

 A further explanation on implementation of serialized inventory is contained under Receiving Processing in P/O and Inventory Transaction Processing and Serial/Lot Processing in I/M.