Community: Accounting and Finance mailing list archives

Re: Perpetual Inventory Valuation in Continental Accounting

Willow IT, Jon Wilson
- 02/26/2016 20:55:30
Hi Jordi

Whilst I agree with your GL Db & Cr's in an ideal world that is not what Odoo does (as far as I know and understand) - are you indicating that it happens that way now? 
  • I mean I knew about the price difference account but not that it was smart enough to work out how many products had been sold before the supplier's invoice arrived? 

  • And are you saying that Odoo is smart enough to update the remaining quants values with the new cost price so as to keep the stock valuation in line with the SOH account? I mean there are so many scenarios to handle - like of the goods are returned before the invoice arrives or they are damaged and moved to scrap and the supplier issues a credit note,....It would be tricky for the system possible know exactly what happened and handle it automatically. (or what about if the invoice arrives before the goods, or only partly arrives?) And what about landed costs if the costs arrive after the goods have been sold or partly sold (the world is not a friendly place).

As far as we can tell Anglo Saxon seems to be broken in V9 as there is no holding account for the COGS/Sale transactions anymore? And why can't there be a price difference account for "continental" accounting? Am I missing something? (I hope not because after all these years yo think I would have got it!).

Really interested in this topic - thanks Quentin

Jonathan Wilson
ph: +61 3 8506 0393
mob: +61 4 000 17 444
2013 & 2015 Odoo Best Partner Asia/Pacific
Creators of  Odoo-Pentaho integration project

On 27 February 2016 at 05:18, Jordi Ballester Alomar <> wrote:
Quentin, easy as pie :)

In perpetual inventory valuation, under average and real costing methods.

Purchase Order: 
Product A: 
- Cost: $10
- Qty: 10

1.- Process Incoming Shipment to receive product. Books into inventory the value of the stockable product at PO price.
Dr. Inventory $100
Cr. Goods Received Not Invoiced $100

2.- 3 items are shipped to the customer before you receive the supplier invoice.
Cr. Inventory $30
Dr. COGS Deferral / COGS $30

2.- Receive supplier invoice
Product A:
- Cost: $11
- Qty: 10

Cr. Accounts Payable $110
Dr. Goods Received Not Invoiced $100
Dr. Inventory: $7
Dr. Price Difference: $3

Affectation to the inventory costing:
Average method: Standard price must be re-averaged. 
Real method: update quants in stock for this transaction adding the new extra cost of $11.

In standard costing the current Odoo's approach is fine. Everything is posted to Price Differences.

A similar thing occurs for exchange rate differences between PO and supplier invoice. But then you post to Exchange Rate differences instead of Price Differences.
Of course, it's usual that both exchange rate differences AND price differences occur at the same time, and then you have to post separately.

I'm coming to Brussels on the 8th of march, and would be happy to review with you.

Find attached a module that makes a slight modification to the current anglo-saxon module to post separately price differences and exchange rate differences. It's not covering the re-valuation, so it's not pixel perfect :)

On Fri, Feb 26, 2016 at 6:17 PM, Quentin De Paoli <> wrote:

Hi community,

recently, a question arose from a customer request which I need to confront to your expertise.

Upon validation of a supplier invoice for a product in perpetual inventory valuation, do we have to have to book the difference between the PO price (inventory valuation price) and the supplier invoice price even if the company is doing continental accounting (no anglo-saxon mode)? If yes, what should be the accounting entries for the incoming shipment and supplier invoice?

Thanks in advance


Quentin De Paoli
LAN Parties Manager
Odoo (Formerly OpenERP) | Facebook | Twiter | Linkedin | Google Plus | Youtube


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