Inventory write-off
Writing off inventory involves removing the cost of no-value inventory items from your accounting records. The amount to write-off is the difference between the book value (cost) of the inventory and the amount of cash that you can obtain by disposing of the inventory in the most optimal manner. Write-off can also be used to use stock internally. In accounting terms, inventory write-offs are functionally identical to stock adjustments.
Use inventory write off to:
Write off stock and services which have been lost, stolen, damaged, given away or used internally.
- Allocate inventory or services expense to a particular job when used in conjunction with the Job costing module.
Prerequisites
Users require the user permission Production: Inventory write-off tasks to create and edit write off tasks.
Non-inventory products are not available for write-off.
Create a new inventory write-off
Stock items written off will be removed from your available inventory.
Select Inventory from the main menu, then Inventory write-off.
+ Add a new write-off.
Identify the Location where stock will be written off.
Select the relevant Expense account.
Click + Add and then select the relevant products or services from your inventory to write off.
Identify the Quantity which will be written off. Cost will be automatically calculated using your chosen Costing methods and previous transactions.
Complete the inventory write-off. This will write off the cost of the inventory to the selected expense account.
Inventory write-off for job costing
The inventory write-off function is also used to allocate expenses of stock and services from your inventory to a job.
View inventory write-off list
View a list of all inventory write-offs and open entries to view details, including financial transactions.
Select Inventory from the main menu, then Inventory write-off.
See the details of previous write-offs by clicking on an entry.
Inventory write-off does not allow import or export, it is not possible to view a summary report of inventory write-off transactions from here. Some options for viewing an inventory write-off summary are:
Using a single expense account for all write off transactions, then running the General ledger report. Inventory write-off transactions can be viewed by checking the relevant expense account.
Run the Inventory movement details report and filter by inventory write-off
Allocate write-off expenses
You can allocate write-off expenses to purchase orders, production runs, assemblies, and stock transfers directly from the inventory write-off. This is especially useful if you make use of co-manufacturing and want to stay out of production, providing component stock to a co-manufacturer to receive the finished goods on a PO.
Select Inventory from the main menu, then Inventory write-off.
Create a new inventory write-off or an open an existing write-off
Go to the Financials tab.
Click Expenses.
Select at least one expense to allocate.
Click the +Allocation button and select what type of task you want to distribute the expenses to: purchase, assembly or stock transfer, or production run.
Allocate the expenses by selecting the task ID and entering the value.
Save your changes when complete. The cost will be distributed based on the total amount of each product included in the task.
Once the allocation has been completed will also be visible in the task where the expense was assigned as a manual journal. These will be also synced with your accounting application next time data is synced.
Undo or void an inventory write-off
Click Undo to reverse all inventory transactions and change the status to Draft, but keep the write-off information. Click Void to reverse all inventory write-off transactions and close the write-off permanently. Void does not allow re-opening or re-authorizing the inventory write-off.
Print inventory write-off
Print inventory write-off details or save as a PDF.
Select Inventory from the main menu, then Inventory write-off.
Open an inventory write-off.
Click Print, then Issue to production.
Attach documents
Inventory write-offs which have been saved as a draft will have an Attachments tab. Documents up to 10MB can be attached for future reference. Any PDF documents generated by printing will be added to this tab automatically. You can also add files from a connected Google Workspace account.
Select Inventory from the main menu, then Inventory write-off.
Open an inventory write-off.
Go to the Attachments tab.
Drag and drop, or select, a file to upload.
View activity log
View all actions taken for an inventory write-off with username and timestamp with the Activity log.
Select Inventory from the main menu, then Inventory write-off.
Open an inventory write-off.
Go to the Activity logs tab.
View financial transactions
View all accounting transactions generated by the system for an inventory write-off.
Select Inventory from the main menu, then Inventory write-off.
Open an inventory write-off.
Go to the Financials tab, then Transactions.