The following topic outlines some of the situations where an RFC may need to be raised, and the suggested processes to follow.
Please note all general ledger accounts referenced in this section assume that your company uses the Inventory Control-General Ledger interface. If your company does not use this, all adjustments will be posted to your regular purchases accounts. PPV = Purchase Price Variances account
1.Goods Faulty – to be returned or scrapped
a.Found prior to receipt
i.Receipt other goods on purchase order. DO NOT receipt the faulty goods. Accept receipts with variance equal to the value of faulty stock.
ii.Raise Goods Return/Pick-Up/Scrap RFC on supplier, enter the original purchase order number and select the applicable ‘Return/Pick-Up’ option.
iii.Uncheck the ‘Adjust Stock when Returned to Supplier’ option as no goods were receipted.
iv.Enter the products and quantities to be credited and returned. Override the warning regarding returning more than was received.
v.Enter the supplier invoice number manually if required.
vi.Approve RFC and send to supplier if required.
vii.Enter Supplier RA number in RFC Entry/Maintenance if received.
viii.Prepare goods for despatch, or scrap goods.
ix.Use the ‘RFC Despatch Return Goods’ program to generate the despatch paperwork, or to mark the goods as scrapped.
x.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: The original invoice was posted with a variance to your PPV account. As no stock adjustments have occurred, the credit received will also be posted to the PPV account to offset the original invoice variance.
b.Found after receipt, but prior to sale
i.Raise Goods Return/Pick-Up/Scrap RFC on supplier, enter the original purchase order number and select the applicable ‘Return/Pick-Up’ option.
ii.Check the ‘Adjust Stock when Returned to Supplier’ option, and enter the warehouse code the goods are currently in.
iii.Select goods to be retuned using the ‘Select Receipt Lines’ option.
iv.Approve RFC and send to supplier if required.
v.Enter Supplier RA number in RFC Entry/Maintenance if received.
vi.Prepare goods for despatch, or scrap goods.
vii.Use the ‘RFC Despatch Return Goods’ program to generate the despatch paperwork, or to mark the goods as scrapped.
viii.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: When the stock is despatched or scrapped, the value is placed in the Receipt Accruals account and the credit received is also posted to that account to offset it.
c.Found after sold to a customer, and the goods are to be returned from the customer
i.Raise an NCN/CAR and receipt the goods into your quarantine warehouse.
ii.Raise Goods Return/Pick-Up/Scrap RFC on supplier, enter the original purchase order number and select the applicable ‘Return/Pick-Up’ option.
iii.Check the ‘Adjust Stock when Returned to Supplier’ option, and enter the quarantine warehouse code.
iv.Select goods to be retuned using the ‘Select Receipt Lines’ option.
v.Approve RFC and send to supplier if required.
vi.Enter Supplier RA number in RFC Entry/Maintenance if received.
vii.Once the goods have been received from the customer and the NCN/CAR has been receipted, prepare the goods for despatch, or scrap goods.
viii.Use the ‘RFC Despatch Return Goods’ program to generate the despatch paperwork, or to mark the goods as scrapped.
ix.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: When the stock is despatched or scrapped, the value is placed in the Receipt Accruals account and the credit received is also posted to that account to offset it
2.Incorrect product received – to be returned or scrapped
a.Found prior to receipt
i.Receipt other goods on purchase order. DO NOT receipt the incorrect product. Accept receipts with variance equal to the value of the incorrect product.
ii.Raise Goods Return/Pick-Up/Scrap RFC on supplier, enter the original purchase order number and select the applicable ‘Return/Pick-Up’ option.
iii.Uncheck the ‘Adjust Stock when Returned to Supplier’ option as no goods were receipted.
iv.Enter the product on the supplier’s invoice with a quantity to credit, and a zero quantity to return
v.Enter the product actually received, or use ‘MISC’ or ‘MISCEX’ if the product does not exist, with a quantity to return and a zero quantity to credit. Override the warning regarding returning more than was received if required.
vi.Enter the supplier invoice number manually if required.
vii.Approve RFC and send to supplier if required.
viii.Enter Supplier RA number in RFC Entry/Maintenance if received.
ix.Prepare goods for despatch, or scrap goods.
x.Use the ‘RFC Despatch Return Goods’ program to generate the despatch paperwork, or to mark the goods as scrapped.
xi.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: The original invoice was posted with a variance to your PPV account. As no stock adjustments have occurred, the credit received will also be posted to the PPV account to offset the original invoice variance.
b.Found after receipt, but prior to sale
i.Raise Goods Return/Pick-Up/Scrap RFC on supplier, enter the original purchase order number and select the applicable ‘Return/Pick-Up’ option.
ii.Check the ‘Adjust Stock when Returned to Supplier’ option, and enter the warehouse code the goods are currently in.
iii.Select the products that the incorrect goods were receipted as using the ‘Select Receipt Lines’ option.
iv.Enter a line comment describing the goods that are actually being returned.
v.Enter the supplier invoice number manually if required.
vi.Approve RFC and send to supplier if required.
vii.Enter Supplier RA number in RFC Entry/Maintenance if received.
viii.Prepare goods for despatch, or scrap goods.
ix.Use the ‘RFC Despatch Return Goods’ program to generate the despatch paperwork, or to mark the goods as scrapped.
x.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: When the stock is despatched or scrapped, the value is placed in the Receipt Accruals account and the credit received is also posted to that account to offset it.
c.Found after sold to a customer
i.Raise an NCN/CAR and receipt the goods into your quarantine warehouse.
ii.Raise Goods Return/Pick-Up/Scrap RFC on supplier, enter the original purchase order number and select the applicable ‘Return/Pick-Up’ option.
iii.Check the ‘Adjust Stock when Returned to Supplier’ option, and enter the quarantine warehouse code.
iv.Select the products that the incorrect goods were receipted as using the ‘Select Receipt Lines’ option.
v.Enter a line comment describing the goods that are actually being returned.
vi.Enter the supplier invoice number manually if required.
vii.Approve RFC and send to supplier if required.
viii.Enter Supplier RA number in RFC Entry/Maintenance if received.
ix.Once the goods have been received from the customer and the NCN/CAR has been receipted, prepare the goods for despatch, or scrap goods.
x.Use the ‘RFC Despatch Return Goods’ program to generate the despatch paperwork, or to mark the goods as scrapped.
xi.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: When the stock is despatched or scrapped, the value is placed in the Receipt Accruals account and the credit received is also posted to that account to offset it.
3.Goods no longer required or goods were incorrectly ordered – to be returned
i.Raise a Goods Return/Pick-Up/Scrap RFC, enter the original purchase order number (if only returning goods from a single P/O), or leave the P/O number blank, and select the applicable ‘Return/Pick-Up’ option.
ii.If the goods are still in stock, Check the ‘Adjust Stock when Returned to Supplier’ option, and enter the warehouse code the goods are currently in.
iii.If the supplier is charging restocking fees, check the ‘Supplier Charging Fees for Return’ option.
iv.Enter the products, quantities to be credited and returned, and the cost price the supplier is crediting the goods at.
v.Select or manually enter a supplier invoice number for each line item.
vi.Enter the return fees being charged (if applicable).
vii.Approve RFC and send to supplier if required.
viii.Enter Supplier RA number in RFC Entry/Maintenance if received.
ix.Prepare goods for despatch.
x.Use the ‘RFC Despatch Return Goods’ program to generate the despatch paperwork.
xi.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: When the stock is despatched, the value is placed in the Receipt Accruals account and the credit received is also posted to that account to offset it.
4.Incorrect supplier invoice
a.Quantity incorrect or goods not received and are not going to be received
i.Receipt the goods actually received and process the receipts with a variance equal to the invoice quantity discrepancy.
ii.Raise a Qty/Cost Adjustment RFC and enter the original purchase order number.
iii.Use the ‘Select Receipt Lines’ button to select the products affected for incorrect quantity received or enter the product code manually for goods not received at all.
iv.Change the ‘Re-Inv’ quantity to the correct quantity.
v.Approve RFC and send to supplier if required.
vi.Enter Supplier RA number in RFC Entry/Maintenance if received.
vii.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: The original invoice was posted with a variance to your PPV account. As no stock adjustments have occurred, the credit received will also be posted to the PPV account to offset the original invoice variance.
b.Cost price incorrect
i.If identified prior to receipt, receipt the goods at the correct cost and process the receipts with a variance equal to the value discrepancy.
ii.Raise a Qty/Cost Adjustment RFC and enter the original purchase order number.
iii.Use the ‘Select Receipt Lines’ button to select the products affected.
iv.Change the ‘Re-Inv’ cost to the correct cost.
v.Approve RFC and send to supplier if required.
vi.Enter Supplier RA number in RFC Entry/Maintenance if received.
vii.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: If the error was found pre-receipt, the original invoice will have been posted with a variance to your PPV account, and as no stock adjustments have occurred, the credit received will also be posted to the PPV account to offset the original invoice variance. If the error was found post receipt, PPV is the correct COGS account to take up this variance.
c.Incorrect freight charged by supplier
i.If identified prior to receipt, receipt the goods with the correct freight value and process the receipts with a variance equal to the freight value discrepancy.
ii.Raise a Freight Adjustment Only RFC and enter the original purchase order number.
iii.Enter the incorrect freight amount in the ‘Credit Freight’ field, and the correct freight value in the ‘Inv Freight’ field.
iv.Approve RFC and send to supplier if required.
v.Enter Supplier RA number in RFC Entry/Maintenance if received.
vi.Once credits/adjustments are received from the supplier, complete the RFC.
G/L Postings: If the error was found pre-receipt, the original invoice will have been posted with a variance to your PPV account, and as no stock adjustments have occurred, the credit received will also be posted to the PPV account to offset the original invoice variance. If the error was found post receipt, PPV is the correct COGS account to take up this variance.
