Goods in Transit (GIT) feature to manage Goods Receipt and Supplier Invoice Payment

Goods in transit (GIT) account is a type of suspense account that helps in managing the Intermediate transactions posting. It helps in separating the Goods Receipt done by Stores person and Accountants booking the “Supplier Invoices” for payments.  Few customers have the practice of uploading Supplier invoices and pay against the same. In this practice, Accountants doesn’t worry on the accuracy of the Invoice as they might pass a corresponding Debit / Credit notes to adjust the overall payments.

In practical scenarios, this helps to separate the “Goods Received” for Inventory and “Supplier Invoices” for the Payment works.

1. Separate the Inventory management portion
2. Create Supplier Liability when you receive Supplier Invoices and not when you receive the materials.
3. Accounts Payable module is modified to handle Supplier Invoices and other advances, DB/CR notes etc.

Procedure to enable in ACTouch – Goods In transit (GIT) Account

1. Set the “Purchase Settings to enable the “GIT feature” – refer to https://www.actouch.com/knowledgebase/purchase-settings-for-goods-in-transit-feature/
2. Now you do the regular Purchase Order – Application will create the GIT Account or set the existing GIT Account for that PO.
3. Receive the materials against the Purchase Order.
4. Application will pass the Accounting Entries as below other than updating inventory, taxes etc.
   1. Db- Inventory Account
   2. Cr – GIT Account
5. Now go to “Purchase Order” -> “Supplier Invoices”
6. While creating a Supplier Invoices, we give an option to Client to enter them against a Purchase Order. He can to upload all the purchase Order line items and this helps to avoid duplicate entry.

Enter the Supplier Invoices.

Create Supplier Invoices as below.

1. You have the option to LINK these documents either to Purchase Order or to a GRN or Multiple POs or GRNs.
2. Once the PO / GRN is linked, those line details are populated on the Invoice. This is designed to reduce the workload.

Listing of Supplier Invoices.

Create the Supplier Invoices as below with all the details as per the SUPPLIER INVOICE and his document number. This will create the Supplier Liability with passing financial entries as

DB       GIT Account of the Purchase Order

Cr.       Supplier Payable Account

Important Note

Goods In transit (GIT) account should be carrying a balance of “ZERO” at the end of the month, with an assumption that whatever the Goods we received, we also received the Supplier Invoices and these are booked. 

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