We seem to have a problem with the postings that are done against the Limit Order PO types. When posting invoices, the system takes the whole balance of the PO that is pending on the GRNI account and adjusts the cost account (see below an example of such a posting):
My understanding of limit order is that we can have GR/IR flag set up in the PO and the invoices could be posted in split values.
For e.g. if the PO limit is for £1000.00 and if the GRN is done for the whole amount.
Dr Expense Account £1000.00
Cr GR/IR Account 1000.00
Then what our system does during the first invoice verification for £100.00 is
Cr Vendor Account - 115
Dr GR/IR A/c 100
Dr VAT Receivable 15
2nd invoice is posted as shown below. No problems there either. The amount is for 200.00
Cr Vendor Account - 230
Dr GR/IR A/c 200
Dr VAT Receivable 30
Then when we post another invoice it just behaves strangely.
It reverses the remaining liability in the GR/IR Account, credits the expense account for the remaining value and posts the document. Here for e.g., the invoice is for 100.00 (Out of 1000 only 400 has been invoiced so far, including this nivoice).
Cr Vendor A./c 115.00
Dr GR/IR Account 600.00
Cr Expense A/c 500.00
Dr VAT Receivable 15.00
Then in the subsequent invoices the system posts only to vendor account, expense account and VAT account, since the GR/IR account is already cleared for the GR amount.
The PO keeps on being open but when a new invoice is posted against it, the cost is debited on the Cost Account (rather than the GRNI account). Obviously this distorts the plant results and KPIs.
Anybody, please could you let us know why this happens and how we could avoid this from happening?
Thank you,
Subash Krishna