Consigned goods describe products that are in the physical custody of one party - the consignee (that would be you) - but belong to another - the consignor. You are not the legal owner but you are responsible for taking care of the goods and trying to sell them to an end customer. In essence, you are acting as a sales agent for the consignor who holds legal ownership/title to the consigned goods. Because consigned goods don't belong to you, they should not be included in the value of your inventory (they are somebody else's assets).

Tip

To ensure the goods in question are really on consignment, ask yourself: If my business burned down today, whose insurance would have to pay to replace these items?

If the answer is your insurance company, the goods are not being sold on consignment; they belong to you and you should follow the normal AP purchasing process.

Example: a consigned piece of equipment was sold for $1,000, the commission you received was $50 and the GST payable on your commission was $2.50.

You would create two Purchase Invoices; one to show the sale and one to receive payment.

Show the Sale: Create a Purchase Invoice for the supplier/consignor (the owner of the goods) with a non-inventory line amount of -$1,000 coded to the asset account (i.e. trucks). Add another line for +$50 coded to an expense account with the GST (+$2.50) on that. The invoice total will total -$947.50.

Receive Payment: Make another invoice from this supplier for a non-inventory purchase for a positive amount of $947.50 coded to the bank receipts account. This represents the cheques/payment coming in. Go into the Suppliers account and apply the outstanding credit or make a payment to print them a cheque.

How do I buy things with my company VISA card or FCC line of credit and then pay the credit card bill?

Not all bills come in the mail and get paid by a cheque. Sometimes you use a credit card, or a gas card, or your FCC line of credit to buy items. You save your receipt from the store, and later in the month a bill arrives from the credit card company which you pay. How does all that get recorded in agrē?

I want to read the white paper on Alternate Ways to Pay the Bills.

How do I record a VISA credit from a supplier?

I made a purchase with the company VISA that I subsequently returned (alternate situation: the supplier overcharged me and is now refunding the difference back to the corporate VISA card). agrē won't let me make a "negative payment" to VISA so how do I record this?

I want to read the white paper on How to Record a VISA Credit from a Supplier.

How can I split a bill with an employee if part is for their personal use?

Every month you receive a bill from SaskTel for cell phone use. Because you have such a great plan, several of your employees have gotten extra phones for their family members. You pay SaskTel the entire amount, but the individual employees pay you back for their personal use.

I want to read the white paper on Recording Employee Expenses.

How can I add freight charges to the cost of the product?

Navigate to the Cost Adjustment tab on a Purchase Invoice and specify the extra per-unit cost. The supplier would be the freight company.

How do I record free product from a supplier?

That's covered in an Inventory FAQ as the first step involves an Inventory Receipt or an Inventory Adjustment.

Why would I need multiple Accounts Payable general ledger accounts?

That's covered in an Accounts Receivable FAQ as the reason is the same for both.

How do I eOrder custom seed blends?

I want to read the white paper on Custom Seed Blends.

Custom seeds blends are retail-created items, not ones you import from CRS Hub, so they're not mapped. Only mapped items can be eOrdered, which makes eOrdering custom seed blends a little tricky. But we've got a white paper to guide you though the process.

Rebates, Rebills and Reconciliations

Instead of a credit to my account for returned drum deposits, I got an actual rebate cheque from my supplier. How do I enter that?

I want to read the white paper (with lots of screen shots) on Supplier Drum Deposit Cheques.

Getting an actual cheque IS different from receiving a credit on your account. Your payables aren't decreasing, the dollar value of the cheque needs to end up in a bank account, and the cost of the goods you got the rebate for needs to be reduced.

Supplier Rebates are handled on Purchase Invoices

When you receive a cheque from a supplier, even if you don’t know exactly what it’s for until later (when you receive more details from the supplier), you’ll enter it as a non-inventory purchase on a Purchase Invoice.

The cheque transaction is not a credit on our account, it is technically a charge: Imagine if one day a supplier just decided to write you a cheque; you would actually owe them for that cheque. It’s like you’re "buying" cash from them. The balance on the supplier’s account will look like you "owe" them for the amount of the rebate cheque until you specify what it’s for. It’s also not like the usual credit on our supplier account, because the funds are coming to us directly and going into the bank, not just showing up as a credit line on our statement.

So, what's the best way to record all this?

First, we deal with the cheque and the bank

create a new Purchase Invoice for the supplier

add a non-inventory purchase for the positive amount of the cheque

select the General Ledger for bank receipts (or a holding account if you're going to use a Bank Deposit to get the cheque into the bank GL later).

This records the receipt of the cheque.

Then we deal with the reduction to Cost of Goods Sold

When the details as to what the rebate cheque was for are better known, you can record them as Cost Adjustments so that your individual product margins are more accurate, or you can record them as a general reduction to Cost of Goods Sold so that your overall margin reflects the reduced cost.

create a new Purchase Invoice for the supplier

if you want to reduce the cost of individual products, enter the rebate as a cost adjustment using negative amounts
(the cost of each product is less now than it used to be)

- or -

if you want to reduce COGS as a whole, enter a non-inventory purchase with negative amounts and select the relevant COGS account
(the total of what I paid to purchase all chemicals is less that is used to be)

And when you put them both together ...

The net effect to the supplier’s account (and so to accounts payable in general) of both purchase invoices is $0. To make it easier to remember, think of it this way:

You’re “paying back cash you owe them” (the cheque)
with “rebates they owe you” (the cost adjustments).

I got a partial credit for product returned to a supplier, but the inventory receipt is in a closed period and can't be split. Now what?

I returned 8 units to a supplier several months ago. I just got the credit, but it's for 5 units with the credit for the other 3 units still to come. I tried to split the inventory receipt line of 8 units into two lines of 5 and 3, but it's dated in a closed period so can't be split. How should I proceed?

First have a chat with the supplier to inquire about the credit for the remaining 3 units. If it is on the way, wait and do all 8 together and combine the paperwork to get the desired result (this is the easiest and least complicated way to deal with this).

If the remaining credit is not arriving soon or you want to process the credit for the 5 units right away:

Add a new PI and import in the FULL return inventory receipt for all 8 units (this will temporarily create an "incorrect" PI credit value but you'll fix that in the next step).

Add a non-inventory row for the equivalent dollar value of the 3 units that you did not receive credit for yet. Post this to a GL of your choosing - you will use the same GL again when the credit for the remaining 3 arrives.

By adding the offsetting entry on the non-inventory tab, the total value of the credit PI is reduced to the value of the 5 units only (but the receipt for all 8 will be used up).

When the credit arrives for the remaining 3 units there will no longer be an inventory receipt to import so add another PI using the non-inventory tab and CR the same GL used in the first transaction. This will now offset that GL to $0 (creating a zero net effect).

Is there a less labour-intensive way to handle my chemical Reconciliations and Rebills?

It's usually best if you can leave the inventory counts as-is, unless you really are returning product to the supplier, and just apply the dollars and change the due dates when possible. Check out this alternative process (you'll need Adobe Acrobat to read it).

I want to read the white paper on Alternative Chemical Supplier Account Reconciliation.

Supplier Payments and Printing Cheques

What is the accrual account for on a supplier payment type? Why do I have to have one?

Accrual accounts are used when making post-dated (also called future-dated) payments. If you will never make a post-dated payment in that location using that payment type, then you don't need to specify an accrual account. If it turns out later that you do need to make a post-dated payment, you'll have to specify an accrual account first.

When making supplier payments, what's the difference between using "Today's Date" and the "Earliest Date of All Invoices Being Paid"?

I want to read the white paper on AP Payments: Explain Earliest Date (you'll need Adobe Acrobat to read it).

When I'm printing cheques, what's this "earliest date" option all about?

The selection you make could impact the date used for the postings made to the GL, as well as the actual date on the cheque (you'll need Adobe Acrobat to read it).

I want to read the white paper on the Explanation of AP Payments Earliest Date.

How do I handle a stale-dated cheque?

You sent a cheque to a supplier, but they either didn't receive it or didn't cash it in time. Now they're asking you for another one.

If the original payment was in the current fiscal year:

Cancel the original payment (add a comment that the cheque was stale-dated for your audit trail).

Make a new payment.

Print a new cheque.

Mail out the new cheque.

If the original payment was in a prior fiscal year:

Cancelling a payment is like saying "it never happened" so any reversals will be effective as of the date of the original payment. If you've already passed on your final year-end numbers to your accountant, you likely won't want to cancel the original payment as that will change your supplier balance and your bank account balance for the prior year. If the prior year is already closed, you wouldn't be able to cancel the original payment anyway.

Note

If the Company Config Option "Prevent Cost Cascade in closed periods" is turned on, you would be able to cancel the original payment and all reversals would be posted to the first day of the oldest open period.
Follow the method above as if the original payment had been made in the current fiscal year.

Don't cancel the original payment.
This shows the balance for the supplier was paid off and the GL account balances will continue match what you have already given to your accountant.

If you've already cancelled the original payment, make the payment again, using the original date. This will again make your numbers match the ones your accountant has already.

We recommend using a non-cheque payment type for this replacement payment.

If you need to use a cheque payment type, just pretend that you printed it (click the Save button so agrē won't ask you to print it again).
Consider using a manual tracking number instead of taking the next available cheque number.

The supplier will need a new cheque, but first you need to "buy back" the money from the supplier to get the funds back into your bank account (since agrē thinks the dollars already came out back on the original payment date).

Add a new Purchase Invoice.
This is for the "buy back" purchase.

Go to the Non-Inventory purchase tab and add a new purchase that uses the same GL as the payment type used for the original payment (if you didn't cancel it) or the 'replacement payment' (if you did) which puts the dollars back into the payment account. Add a comment for your audit trail.

Now you have the money back in the bank, and you owe the supplier the same amount.
In effect, you are 'purchasing money' from the supplier and putting it in your bank account.

Unapply the credits of the original payment from the original purchase invoice(s).
The original payment didn't actually pay anything off because it wasn't cashed.
This leaves unapplied credits on the supplier's account in the amount of the original cheque and the original purchase invoice(s) flagged as unpaid.

Apply the credits from the original payment to the "'buy back" purchase invoice.

Pay the supplier for the original purchase invoice with a new payment using a cheque payment type.

Print the new cheque for the supplier.
Because you used the new payment to pay off the original purchase invoice, the cheque stub will display the original purchase invoice reference number(s).

Mail out the new cheque.

Reconciling the Bank Account

When you get your next bank statement, flag the original payment and the "buy back" purchase invoice as reconciled.
These two transactions cancel each other out.

You'll flag the 'replacement payment' as reconciled when you see it on a bank statement and know that it has cleared the account.

Why do cheques that I've already printed keep showing up in the list of cheques that need to be printed?

The most common reason is that when the cheques were printed, they weren't saved as printed. There's an easy fix for that (you'll need Adobe Acrobat to read it).

I want to read the white paper AP Printed Cheques That Keep Appearing.

Can I setup a "generic supplier" instead of adding a new supplier every time I need to print a one-of cheque for someone new?

You sure can! The print (and reprint) of cheques displays the supplier name that is on the supplier account at the time the payment was generated so the cheque will have whatever name is on the supplier account when you make the payment.

Setup a ‘generic supplier’, and change the Name on Cheque/EFT (which will override the supplier account name when you print a cheque) to the "one-time supplier name" before generating the payment, then make the payment and print the cheque. You can't generate the payment, change the name, and then print the cheque (you'll always see whatever Name on Cheque/EFT was on the supplier account at the time the payment was generated).

After the cheque is printed, remove the Name on Cheque/EFT from the generic supplier account so it's ready for the next one-time payment.

If paying by EFT, select Manage EFT and enter those details as well, remember to remove them after payment has been made.

Do I need a separate payment type for manual cheques?

This is one of those "it depends" kind of answers. Do you have separate manual cheques? Then you definitely want a separate payment type for them.

If you don’t have separate manual cheques and just occasionally handwrite one instead of running through the printer, follow the steps in the FAQ below to update the next available cheque number.

How do tell agrē I KNOW that cheque number is already used so just go ahead and use the next one?

I needed to print a cheque but our printer was down, so I had to handwrite everything on it. In agrē, I recorded the cheque number manually when I made the payment. Now when I go to print cheques, I get a message telling me that cheque number already exists. How do I tell agrē to increment to the next number?

Navigate to: Accounts Payable > Manage > AP Payment Types, Edit the payment type, and update the Next Cheque No. for your location.

Two payments have a cheque number that doesn't match the cheque - how can I swap the cheque numbers?

You can swap the cheque numbers by Reprinting the Cheques.

Select Use New Cheque Numbers

Set Cheque A to 3rd cheque number (one not yet used)

Set Cheque B to Cheque A's original Cheque Number

Set Cheque A to Cheque B's original Cheque Number