(Purchasing | Reports |Analysis |Received/Not Invoiced)

The Received/Not Invoiced Report (RNI) was created to allow Microsoft Dynamics GP users to reconcile their sub-ledger receipts to the Purchase Accrual Account. It provides a detailed list of all the open receipts pending to be invoiced.

Reconciling the Purchase Accrual Account is always challenging.  Normally, users do not even realize that Dynamics GP has a report to help reconcile the account.   

There are a few reasons for this report to have discrepancies.  First, remember that the Purchase Accrual Account is a control account. These types of accounts are tied to a sub-ledger and should not have journal entries entered directly to them. Normally, an off balance sub-ledger is the result of creating journal entries directly to a control account.

The second issue with this report are receipts that have not been matched to an invoice and the invoice has been paid directly in Payables. There is a best practice in Dynamics GP to handle the purchase of products. When this process is altered without understanding the transactions, the result is an out of balance sub-ledger to General Ledger. This is usually caused by the purchase order being manually closed before matching the invoice to the receipt.

The most common process and best practice used to handle purchase orders in Dynamics GP is called: “Three Way Match”

Understanding the flow of a purchasing transaction becomes very important to make sure the RNI report and the Purchase Accrual Account reconcile to each other.

In a ‘perfect world’, the purchasing process in Dynamics GP should be as follows:

  1. Create a Purchase Order
  2. Receive the Purchase Order
  3. Enter and Match the Invoice to the Receipt
  4. Pay the Invoice in Payables

Below are the distributions associated with each transaction. In this example, a Purchase Order for $500 worth of products was created.

How to reconcile the RNI report to the General Ledger

  1. Review the way you are currently using the Purchase Order Processing Module in Dynamics GP
    • Make sure the purchase process is completed in the ‘perfect world’ example above.
  2. Next, identify all Purchase Orders in the report that have already been received.  These still show on the RNI report because improper matching was done.
    • Close the above-identified Purchase Orders:
      Transactions | Purchasing | Edit Purchase Orders
  • Edit Purchase Order Lines, set status to ‘Closed’
  • Change Purchase Order Status to Closed
  • Click Process   

NOTE: ***Closing these Purchase Orders will correct the balance on the RNI report, but does not generate a journal entry to correct the accrual account. ****

      3. Run the RNI report and adjust Purchase Accrual Account to match the report

      4. Reconcile the RNI to GL weekly at the most and monthly at minimum to avoid discrepancies

Depending on the Dynamics GP version, enable the warning message that lets the user know that the PO has not been matched before closing. Go to Purchasing | Setup| Purchase Order Processing and mark ‘Warn when Purchase Order Line Item is Not Fully Invoiced.’

If there are receipts that still show up on the RNI report after being closed from the application, you will need to run a SQL script to remove them from the report.

  1. Create a backup of your Company Database
  2. Run the following queries:

To identify the DEX_ROW_ID for the receipts in question:

SELECT * FROM POP10500 WHERE POPRCTNM = ‘XXXX’

Obtain the DEX_ROW_ID at the very end of the row and run the following update:

UPDATE POP10500 SET QTYMATCH = QTYSHPPD WHERE DEX_ROW_ID = XXX

Why is my report out of balance?

  1. The purchase order was received in purchasing, but was never Enter/Matched against and the invoice was entered directly into Payables.
  2. A journal entry was posted directly to the Purchase Accrual Account.
  3. The purchase order was closed manually before matching the receipt to the invoice. When the user tries to match the invoice, the receipt is not available.
  4. Receipt hit the incorrect General Ledger account.

Reconciliation of sub-ledgers is a challenge.  However, following Dynamics GP best practices can make the reconciliation process easier and more efficient.  By utilizing the methods explained in this blog you’re the Purchase Accrual Account should match from Purchase Order Processing to the General Ledger.  For additional assistance with Purchase Order Processing reconciliation, please reach out to FMT Consultants by filling out the form below.