Accounts Defer Cost of Sales

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By default all new Khaos Control systems are configured to use deferred cost of sales. This helps to avoid things like recording 100% of the net sell price as the cost of sale because you have not yet finished entering stock values for all items (please refer to "Controlling your Khaos Control system from Day One", which is provided as part of the "Go Live" process).

When active, this option stops Khaos Control from automatically posting the Cost of Sale to the nominals, and therefore the Profit & Loss (P&L), at the point sales invoices are issued. Cost of Sale is posted semi-manually instead. This affords your business the opportunity of checking the Cost of Sale (stock value) figures that are going to be posted before they hit the nominal accounts and the P&L and to change stock values and/or overhead figures as required.

To disable Deferred Cost of Sales see How To: Enable Deferred Cost of Sale.

For more information on how to understand the entire Deferred Cost of Sales Process and the effects on your accounts please read Basic Deferred Cost of Sale Example and for a visual guide of the processes involved when using Deferred Cost of Sales, see How To: Understand the Deferred Cost of Sales Process.

Impact when Defer Cost of Sale is Enabled

  1. When sales invoices are issued and figures posted to the accounts, Cost of Sale data will not be posted (an end of period option is used to post Cost of Sale figures for invoices manually).
  2. Sales Orders and Sales Summary reports will display an estimated Cost of Sale figure, based on Stock Value and Overhead figures for stock items on an invoice at the time it was issued. These may not match with the manually posted Cost of Sale figures in the Accounts when using this method. When you have finished posting the deferred COS figures the relevant Sales Orders, Invoices and Sales Summary entries will also be updated.

Notes:

  1. Both stock controlled and non-stock controlled items are included on the Deferred COS report.
  2. Both non-stock controlled and stock controlled drop-ship items are included on the report; COS for a drop-ship item is the same as any other item, it comes from the Stock Value on the item record.
  3. If Pack Children are not printed on sales orders (see Don't Print Child Items) then the stock value will have to be entered manually on the pack header stock item.
  4. Zero value entries will be marked as Excluded, these cannot be posted as no value is required to be posted into the accounts. This prevents the build up of zero value entries.
  5. Excluded items from an invoice will also be removed from the report when posting any other entries for the invoice.
  6. If you turn Defer Cost of Sales off, and you are using the Average Price Paid method to calculate your stock values, any purchase invoices posted prior to you disabling Defer Cost of Sales will not be included in the stock value calculation.

Deferred Cost of Sale Report

To generate a Deferred Cost of Sales report the Invoice items awaiting COS postings dialog is loaded from the Accounts Other Action Menu, see How To: Generate and Analyse the Deferred Cost of Sales Report. For information about posting the Deferred Cost of Sales see How To: Post a Deferred Cost of Sales.

See Also

Visit KhaosWikiX at https://support.khaoscontrol.com/wiki_kcx/ to see the following:

Contact the Khaos Team