MAS 90 / 200 Purchase Order Tips

How to Clear Backordered Purchase Orders

In Sage MAS 90 and Sage MAS 200, completed Purchase Orders that have been completed longer than the specified number of days, assigned in the Purchase Order Options (Number of Days to Retain Completed PO setting), are purged automatically during Period End Processing.

For the Purchase Order status to change to Completed, the Ordered quantity must equal the Received Quantity. And if the Purchase Order Option flag "Post A/P Invoices" is turned on, then the Ordered quantity must equal the Received Quantity and the Invoiced Quantity. (See notes at the end for exceptions).

The Daily Receipt Registers/Update process compares the lines for all POs and completes the purchase order when the quantity ordered = quantity received = quantity invoiced. (See notes for exception based on PO settings).

It is important to investigate and understand the reasons why a Purchase Order is in a Backordered status so the proper procedure for clearing the Backordered status is used. Before proceeding determine why the ordered quantity does not match the received and invoiced quantities.

To verify the quantities for the three amounts, run one of the Purchases Clearing reports from the P.O. Period End menu. Run the report option for Purchases Clearing in Open PO format. A more summarized Report Master or Crystal report can also be created, selecting on a calculated field (Quantity Ordered minus Quantity Invoiced) if the calculated value is zero. (This report would also list all purchase orders not invoiced yet).

Example #1:Ordered = 10 Received = 8 Invoiced = 8

Solutions:

A. If the remaining 2 are to be received, process a Receipt of Goods (with an invoice number) for a quantity of two.

B. If the remaining 2 are NOT to be received, change the ordered quantity from 10 to 8 (in Purchase Order Entry).

Once the three quantities match, and the order is accepted in Purchase Order Entry, the PO status will be changed to Completed.

Example #2: Ordered = 10 Received = 10 Invoiced = 0

In this scenario the invoice was usually entered directly in Accounts Payable. Since a G/L posting of Debit to Inventory and Credit to Purchases Clearing was made when the Receipt of Goods was updated there is a Credit amount in the Purchases Clearing Account.

Solutions:

A. Turn off the "Post A/P Invoices" setting in Purchase Order Options. This will cause the system to disregard the invoiced quantity field. In Purchase Order Entry, change the ordered quantity up to 11 and click OK to accept the line. Re-select the line, and change the ordered quantity back down to 10, click OK, and accept the order. This procedure will change the PO status from Backordered to Completed. Be sure to turn the Purchase Order Options "Post A/P Invoices" setting back on before entering or updating any new receipts.

A general ledger correcting entry will be required to balance the purchases clearing account. The correcting G/L entry should be:

Debit: Purchases Clearing

Credit: The A/P expense account the A/P invoice debited

B. Process a Receipt of Invoice for the quantity 10. Since Sage MAS 90 won’t allow you to use the same A/P invoice number, add an "-A" on the end of the original invoice (or something similar) for tracking purposes. Then in A/P Invoice Data Entry, adjust the newly created invoice to 0.00 using the A/P expense account the original invoice debited. This will have the net effect of debiting Inventory and crediting A/P

Example #3: Ordered = 10 Received = 12 Invoiced = 12

Solutions:

A. If the order was over received then process a return of goods with an invoice number for a quantity of 2 (since Sage MAS 90 won’t allow you to use the same A/P invoice number, add an "-A" on the end of the invoice (or something similar) for tracking purposes.

B. If the quantity of 12 received is accurate, then change the ordered quantity to 12 and accept the order. The order will change to a completed status.

Notes

Entry of a Purchase Order does not create a G/L entry. The Purchases Clearing account only comes into play when a receipt of goods is processed without an invoice.
A completed Purchase Order will remain in Purchase Order Entry until the Purchase Order Option "Number of Days to Retain Completed PO" setting is exceeded, AND a Period End Processing is performed.
There is a setting to "Automatically Close Partially Received POs" which allows a percentage variance between the quantity ordered and received/invoiced quantities. If the variance is set at 10% for example, and 10 were ordered when 9 are received and invoiced then the PO will complete.
The option to "Purge Completed POs" under Period End Processing will remove completed purchase orders from the PO Entry files based on the setting for "Number of Days to retain Completed PO" in Purchase Order Options.
The "Purge Obsolete Purchase Orders" program (under the Period End Processing menu) purge all purchase orders prior to a selected date. This program will look at the purchase order Order Date (on the header tab), as well as the Last Receipt date and Last Invoice date on the Totals tab. All dates must be older than the specified purge date. A blank date is OK and will be purged.

Important

This function will purge all Purchase Orders regardless of status. A G/L journal entry to adjust the Purchases Clearing account for those POs where the received quantity does not match the invoiced quantity must be made.