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Re: Perpetual Inventory Valuation in Continental Accounting

by
Nhomar Hernandez
- 02/27/2016 02:44:21

2016-02-26 18:46 GMT-06:00 Jordi Ballester Alomar <jordi.ballester@eficent.com>:
Eric, there's no thing as continental or anglo saxon in the accounting world. This is somerthing that Odoo made up.

Ups!

Jordi wrong comment here.... YES there it is:

http://isiarticles.com/bundles/Article/pre/pdf/10137.pdf << continental

Basically the difference is (falling apart on taxes part but diferent topic).

Anglo Saxon: The Ownership of a product is ONLY declared when invoice is done, then you can Provision your inventories but they only belongs to you when invoice IS with you.

Continental: The Ownership of the product IS when the product went to your inventories, IT means your Assets in terms of Inventory will decrease/increase with the simple move of the product (Invoiced or Not).

This is NOT an Odoo's term it is a Global accepted term.

The issue is that when Odoo born it was in Belgium in a little farm and obviously the default behavior was continental (which is not the most popular ones) because USA use Anglo.

The Perpetual vs Periodical IS about WHEN you put the journal Entry "Transaction by transaction or period by period" but it does not have any delation with the recognition of your asset valuation.

And yes there is a Third one "Accrual" which do not have relation AFAICK with the inventory recognition it has relation with Payables and Receivbles recognition (not sure on thi but that' what I can remember).

The huge issue is that when you mix Periodical Valuation with Continental (which was the initial Odoo'd approach= it give the technical impresion that you invenotries in the closing period process are consistent with the accounting Inventories, when you introduce Anglo saxon + Periodical (new default approach) you MUST take of invoices into account and there is when some confisions coms up, but now tha behavior is correct.

Sorry for my poor english here but this is a topic I explain better in Spanish but here ther is not any odoo term it is a well accepted accounting term.

Regards.
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CEO at Vauxoo Odoo's Gold Partner.
 
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Nhomar Hernandez
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