First post, but joined specifically for this issue. Help would be very much appreciated.
Good Received Not Invoiced.
The normal balance of a GRNI account would be Cr balance unless all invoices appear at the same time and clear everything out (unlikely)! Is this right?
If a GRNI balance is Dr then does this indicate potential price variances from PO to invoice in company's favour?
If GRNI is Dr at the end of a period, and this is indeed a win, what happens if this value is moved from one accounting system to another (system change) and has been posted in the new accounts system as a Dr in the P&L?
My gut feeling is that transaction would be wrong. A) should it have gone to the P&L or the BS and B) is it really an expense given that its a Dr balance on the BS? Should this have gone as a Cr to the expenditure account in the P&L?
If i have this megga wrong its because i have been around the block with it, and my mind is fried!
Thanks.
Replies (4)
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I can't quite follow your thread - but..
GRNI can get quite involved, - particularly with large volumes of transactions.
However, if you think about first principles:
An entry in GRNI will occur when the delivery note is marked as received, but before the invoice - hence:
DR Stock (at PO price)
CR GRNI (at PO price)
The GRNI balance will clear when the invoice is posted:
DR GRNI (at PO price)
CR Purchase Ledger
CR/DR Price variance (as appropriate).
Thus - there is no reason why the GRNI balance should not be CR.
If it is ending up as DR, then your system is not dealing with the price variances properly.
But surely...
If you receive the invoice before the stock arrives, then you legitimately have a Dr balance? We see this quite a lot when goods are bought from China and are invoiced and paid for well before the stock arrives.
GRNI
If you receive the invoice before the stock arrives, then you legitimately have a Dr balance? We see this quite a lot when goods are bought from China and are invoiced and paid for well before the stock arrives.
Yes but probably not in the Goods Received Not Invoiced (GRNI) account, but in the Goods Invoiced Not Received (GINR) account!
But who knows what the balance on the OP's account represents - if they don't know what transactions have been posted to it how can we be supposed to know?
Time for the OP to roll their sleeves up I think.