Forum Discussion

kyleenich's avatar
kyleenich
Experienced Cover User
2 years ago

Negative inventory account balances

Hi I have an item in inventory that has a negative account balance even though the item has had no transactions for in excess of 18 months. We are reonciling the inventory values in preparation for ...
  • gavin12345's avatar
    gavin12345
    2 years ago

    Hi kyleenich 

     

    While the MYOB scripts may fix unusual inventory item values and on hand counts, they don't usually fix existing transactions. 

     

    Before you proceed with the suggested Inventory Adjustment Journal, it may pay to get a MYOB consultant well versed in inventory issues in AR2023 to take a closer look at the file to see what has caused this situation. It may well have been caused by an incorrect Item setting, or by an usual transaction, or by using an incorrect item value.

     

    Without knowing how it was caused you are not going to confidently know how to fix it. Typically if an Inventory asset account is in negative, this means too much COS was shifted from this account to the P&L Cost of Sales account linked to the item(s). If there are no items on hand, an Inventory Adjustment Journal may make things worse. A general journal Dr the Inventory asset account and Cr the linked Cost of Sales is more likely to both fix the account balance and correct an overclaim of costs on the P&L. 

     

    Regards

    Gavin

Earl_HD's avatar
Earl_HD
MYOB Moderator

Hi kyleenich,

Thanks for the screenshot. What I would suggest is to make an inventory adjustment. This help article will give you more information about: Making inventory adjustments


Please do let me know how you go on this.
Regards,
Earl

gavin12345's avatar
gavin12345
Ultimate User
2 years ago

Hi kyleenich 

 

While the MYOB scripts may fix unusual inventory item values and on hand counts, they don't usually fix existing transactions. 

 

Before you proceed with the suggested Inventory Adjustment Journal, it may pay to get a MYOB consultant well versed in inventory issues in AR2023 to take a closer look at the file to see what has caused this situation. It may well have been caused by an incorrect Item setting, or by an usual transaction, or by using an incorrect item value.

 

Without knowing how it was caused you are not going to confidently know how to fix it. Typically if an Inventory asset account is in negative, this means too much COS was shifted from this account to the P&L Cost of Sales account linked to the item(s). If there are no items on hand, an Inventory Adjustment Journal may make things worse. A general journal Dr the Inventory asset account and Cr the linked Cost of Sales is more likely to both fix the account balance and correct an overclaim of costs on the P&L. 

 

Regards

Gavin

  • kyleenich's avatar
    kyleenich
    Experienced Cover User
    2 years ago

    Hi Gavin

    Thanks for your response. I've entered a journal today as per your instructions and the negatives have now been cleared.

    Thanks again,

    Kylee

Looking for something else?

Search the Community Forum for answers or find your topic and get the conversation started!

Community home

Dig into MYOB Academy for free courses, learning paths and live events to help build your business with MYOB.