3 Reasons Your JD Edwards Stock Status May Not Match Your Trial Balance
Part of the period-end close process is reconciling inventory balances to the general ledger. This process typically involves getting 2 reports:
- “Stock Status” – Lists all stock items, quantity on hand, and extended value at a moment in time.
- “Trial Balance” – Lists general ledger accounts and balances for a designated period end.
Most companies I speak with schedule the JD Edwards stock status report to run after transactional activity has stopped on the last day of the period. The balance listed on that report is compared to the trial balance for the inventory account(s) after all batches have been posted. You would be very fortunate if the numbers tied out.
Here are 3 reasons why the stock status may not match the trial balance:
Timing – WHEN the stock status report is run is critical. To be close to the trial balance it is imperative there is no transactional activity happening between the time the report is run, and the end of the period in terms of server time. You may have users in time zones all over the world, but transactions are recorded according to the clock on the JD Edwards server. If transactions do occur after the stock status is run, then there will be reconciling items that must be accounted for.
Backdating – This can occur by manually inputting either the transaction date or GL date on inventory issues, adjustments, transfers, or receipts. It can also happen by setting processing options in the manufacturing accounting or sales update programs. The latter may be done intentionally. A scenario could be an item was physically shipped on the last day of the period, but the shipment confirmation transaction was not done until the first day of the following period. In this case, the stock status would show the goods still in stock, but backdating the general ledger removes the value from the prior period's account balance. Reconciling item!
Report Definition – How the stock status report is written can also cause some issues:
- Specifying the cost method, such as ‘07’, may not be an accurate way to fetch the unit cost from the F4105 table, especially if you use mixed cost methods (e.g., some items use average and others are standard). Use COCSIN = ‘I’ to get the applicable cost, regardless of cost type.
- Non-stock items may be another source of concern. These are items that are typically expensed upon receipt and should not carry a unit cost in the inventory system. If a cost does somehow get associated with these items, then guess what …. Reconciliation problems!
- Data selection criteria must be carefully reviewed to ensure items are being mistakenly excluded from the calculations.
As you can see there are many things to consider when matching the JD Edwards stock status to the trial balance. While I have listed 3 reasons there are certainly more. I will cover some in my next article. Until then, happy reconciling!
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