nventory Valuation in Odoo

There are two types of inventory valuation in Odoo:

Manual Valuation:

No automatic journal entries are created.

Stock moves (receipts/deliveries) do not affect accounting.

You post accounting entries manually (usually at period-end or after stock counts).

Automated Valuation:

Every stock move (PO receipt, delivery to customer, internal transfer) automatically posts a journal entry.

Inventory value is reflected in the Balance Sheet (Assets → Inventory).

🛠️ Steps to Move from Manual → Automated Valuation

1. Preparation

Make sure accounts are properly configured:

Stock Valuation Account (Balance Sheet, Asset).

Stock Input Account (temporary account used during receipts).

Stock Output Account (temporary account used during deliveries).

In Products or Product Categories, set:

Inventory Valuation = Automated.

Costing Method = Standard / FIFO / Average (depending on your policy).

2. Define a Cut-off Date

Choose the transition date for automation. Example:

Until 31 August → manual valuation.

From 1 September → automated valuation.

3. Transition Journal Entry

Before switching:

Perform an Inventory Adjustment to confirm stock quantities.

Calculate the total stock value (based on your manual records or stock count).

Post a manual journal entry for the opening balance:

Dr Inventory (Balance Sheet Account)

Cr Inventory Opening / Adjustment Account

👉 This establishes the opening inventory balance in your accounting system.

4. Switch in Odoo

Go to Inventory → Configuration → Product Categories.

Open the product category.

Change Inventory Valuation from Manual → Automated.

Assign the relevant accounts (Valuation / Input / Output).

From this point, all new stock moves will generate journal entries automatically.

5. Verification

Test by creating a Purchase Order Receipt or Delivery Order.

Check the Journal Entries in Accounting.

Ensure that balances match with stock movements.

⚠️ Important Notes:

Switching does not back-post journal entries for past stock moves.

You must record an Opening Balance Journal Entry on the cut-off date to align stock and accounting.

📊 Example:

On 31 August, physical inventory value = 100,000 EGP.

Manual entry:

Dr Inventory (100,000)

Cr Inventory Opening (100,000)

From 1 September, automated valuation is enabled:

New receipts → increase stock automatically.

New deliveries → decrease stock automatically.

Hi,

Please refer to the following links:

1. https://www.odoo.com/documentation/18.0/applications/inventory_and_mrp/inventory/product_management/inventory_valuation/inventory_valuation_config.html

2. https://www.odoo.com/documentation/17.0/th/applications/inventory_and_mrp/inventory/product_management/inventory_valuation/inventory_valuation_config.html

Hope it helps.

Please see https://www.odoo.com/forum/help-1/inventory-valuation-moving-from-manual-periodic-to-automated-real-time-process-best-practices-171698

Hii,

To switch from manual to automatic inventory valuation in Odoo:

1. Enable Developer Mode
   Go to Settings → Activate Developer Mode.
2. Update Product Category
   Go to Inventory → Configuration → Product Categories
   • Set Inventory Valuation = Automated
   • Choose a Costing Method (e.g., FIFO, Average)
   • Set required accounts: Stock Valuation, Input, Output, and Stock Journal
3. Adjust Inventory
   Create an Inventory Adjustment to reflect correct stock levels.
   This will generate accounting entries automatically.
4. Verify
   Test with stock movements and check Accounting → Journal Entries.