Create Opening Balance – A summary of the activity

This activity allows you to record the opening balance of stock in a warehouse. Transactions such as work orders, issues and receipts, need to verify the availability of stock in the different warehouses of the login organizational unit. Before requesting for the supply of a specific part, it is important to know the balance of stock available in the warehouse. Prior to generating any transaction for a particular part in a warehouse, you must record the opening balance for the part.

Note: You cannot record the opening balance for a warehouse or zone, which is frozen for the “Physical Inventory and Cycle Counting” process.

When the opening balance is recorded, the rate, value and the status of the stock are recorded in the warehouse.

You can also enter the lot number and serial number details of the part, in case the part is lot number or serial number controlled.  

The various costing methods are “FIFO”, “LIFO”, “Weighted Average”, “Actual Cost” and “Standard Cost. In the “FIFO” method. In the FIFO method stocks are issued at the earliest receipt price first and subsequent issues are made at next earliest prices in chronological order. In the “LIFO” method, stocks are issued at the latest price and subsequent issues are made at earlier prices in chronological order. In the “Weighted average” method, the system fixes the issue rates by calculating the average of receipt values weighed by the receipt quantities. In the “Standard costing” method, unit costs for material are predetermined and fixed as standard cost for each item. In the “Actual costing” method, the part is issued at the actual value in which it was received.

You can enter the rate or value for the quantity of the part, if the stock valuation method is “Weighted Average”. For a part with the valuation method defined as “LIFO” or “FIFO”, the various rates or values at which it was received must be specified in a chronological order. You can also evaluate the cost of the part based on the standard and the actual cost.

Getting familiar with the pages inside

What you can do in this activity

Record Opening Balance

Modify the opening balance

Record the serial and lot number details

Maintain the reference details

Record the cost details for the various stock valuation methods

Record Opening Balance

You can record the opening balance of stock in a warehouse, as on a particular date.

• Use the “Create Opening Balance” page, to record the opening balance information.

Modify Opening Balance

You can modify the opening balance details of the stock in a warehouse.

• Use the “Create Opening Balance” page, to record the opening balance information.

• Use the “Edit Opening Balance” page, to modify the opening balance details of the stock.

Maintain References

You can maintain the reference document details for the opening balance. The details like the file name, reference document involved etc can be  recorded in this page.

• Use the “Create Opening Balance” page, to record the opening balance information.

• Use the “Edit References” page, to record the reference document informations

Record the serial and lot number details

You can record the serial number and lot number details, while recording the opening balance for the parts received in the warehouse. The quantity, rate and value can be recorded for each serial and lot number.

• Use the “Create Opening Balance” page, to record the opening balance information.

• Use the “Serial & Lot Details” page to enter the manufacturer serial and lot number details for serial and lot controlled parts.

Record the cost details for the various stock valuation methods

You can record the actual cost or the unit rate details for the various stock valuation methods such as “Weighted Average”, “Actual Costing”, “LIFO” and “FIFO” and “Standard Costing”.

• Use the “Create Opening Balance” page, to record the opening balance information.

• Use the “Edit Weighted Avg / Actual Lot Cost Information” page, to record the actual cost for a part with stock valuation method defined as “Weighted Average”, “Actual Costing” or “Standard Costing”.

• Use the “LIFO/FIFO Rate Details” page, to record the LIFO or FIFO rates for a part with stock valuation method defined as “LIFO” or “FIFO”.