Balancing WorkGuru and Accounting Stock Values

WorkGuru's FIFO perpetual inventory method is an extremely accurate way of maintaining your stock on hand (SoH) quantities and value. An advantage of using the perpetual inventory method is that WorkGuru knows exactly which transaction caused a change in stock on hand and when it happened. However, it is important that you are aware of how this inventory method talks to your accounting system, especially when you are expecting balanced values, such as end of month. Xero is used as the example here, but it is the same concept across all accounting systems WorkGuru integrates with.

In short, WorkGuru and Xero won't necessarily balance exactly because of the way they deal with when things are happening. The difference is subtle, but important.  The date your receive, invoice, back or forward date stock related transactions will all impact the stock values both in WorkGuru and your integrated accounting system.

Note: It is extremely important to NEVER manually journal your stock value in the integrated accounting system to "fix" perceived stock value issues.

Purchasing

Xero cares only about the invoice date, so Xero SoH goes up when the invoice is received (invoice date). WorkGuru cares about the physical SoH, so WorkGuru stock goes up when the goods are received (received date).  Xero will be correct from a tax perspective (because the invoice accrual date is what they care about) and WorkGuru will be right from a physical stock perspective, and sadly those two things aren't the same! - Also, you shouldn't try and make them marry up every month because that will just break things for the future 

This timing difference is the reason we have the "Purchasing and Accounting Discrepancies" report (Reports -> Purchases), as when clients have orders that have invoiced and received dates in different periods (month, quarter, FY etc).   You can also quickly keep track of these values visually from the purchase order dashboard widgets:

Clicking on the widget will display the relevant orders:

• Received Not Billed -  Stock value in WorkGuru NOT in Xero
• Billed Not Received - Stock value in Xero NOT in Xero

Cost of Goods Sold (COGS)

COGS  can also contribute to a difference between WorkGuru and accounting. The advantage of the FIFO perpetual inventory method is that WorkGuru knows exactly which transactions have both increased (purchases) and stock out (stock usage). This allows scenario where the unit cost of a product has changed due to additional landed costs etc, even if the products effected are no longer in stock.  As WorkGuru knows which projects used that stock, the increased unit costs can be applied via an updated COGS journal.  This means that COGS, though transactionally correct, may change month to month. 

COGS differences can be reviewed with the COGS Journals Comparison Report.  Assuming your COGS is up to date, any differences between values in the Change in Stock Value Sent to Accounting and Change in Stock Value in WorkGuru columns will indicate there are some backdated COGS that need to be updated. For any month with a difference in COGS value, resend to update that months journal. For Xero, click Resend to Xero etc.