Tips for Using Inventory Management on Quickbooks Desktop

In a previous article we discussed inventory management in Quickbooks Online. In this article, we will discuss the inventory management challenges that Quickbooks Administrators often face on Quickbooks Desktop. Here are tips that can be considered so that Quickbooks users in our company do not take harmful actions:

1. Don’t allow employees to create a “Negative Inventory”

When recording or revising a transaction in Quickbooks desktop enterprise, employees may inadvertently make the inventory status negative. This is one of the main causes of damage to the Quickbooks (QBW) data file used. Employees may fail to record Item Receipts, or record invoices without confirming “quantity on hand” beforehand. Whatever the cause, Quickbooks is unable to calculate the average cost of goods sold (COGS) on the item when an item is sold when the inventory status is in deficit.

2. Don’t ignore access “permissions”

Setting up Quickbooks user profiles is actually an easy thing to do but is often not done by Administrators. This problem is even very often ignored by companies that use Quickbooks with the gradual increase in the number of user licenses. Administrators also often intentionally provide profiles for all users with “Full Access” to an active QBW file because it is considered that every employee has overlapping work needs or is “lazy” to define each user’s profile explicitly. In QuickBooks Premier, we can define user profiles according to their job descriptions such as Account Receivable, Account Payable, or others including limiting their access to financial and reporting information.

3. Create a report “Unpaid Bill Details”

We may not be able to bring up all transaction details related to inventory. When our employees receive the goods and process the Item Receipts, financially the company already considers it a debt, but the payment cannot be processed before we receive the bill. At the time the invoice is received, our other employees may not be aware that an Item Receipt has been issued. Errors will arise when employees record invoices against the COGS account on the general ledger. Or it can be even more fatal by entering all billing information so that there is a duplication of recording the Item Receipt that was previously created.

4. Perform “Triple Check” upon receipt of goods

Employees in charge of purchasing goods issue purchase orders based on company needs. The employee of the goods receiving department only checks what and how much quantity/quality of goods received based on the receipt document. Finance employees will receive invoices and make payments according to receipts. But can the company ensure that the goods received are in accordance with the required amount with the agreed price? We should also have employees who have a duty to ensure that the ordered goods we receive are in accordance with the goods needed by the company before making bill payments.

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