Prevent COGS from Calculating on Closed Periods

With the release of version 2010.2, Cost of Goods Sold (COGS) program does not automatically perform costing corrections in past periods.  This however is dependent on users not having transactions with mismatched date/period.

What is a date/period mismatch?  This occurs when a user enters a transaction with a transaction date that does not fall within the accounting period selected.

Following are examples of transactions with mismatched date/periods and the effect this can have on a user's books:

Example 1

If a user enters this transaction:

                                    Transaction Date                      Period

Vendor Bill                   9/1/2010                                October 2010

Result: COGS will run based on 9/1/2010.  All transactions after 9/1 will be corrected - even if September is closed.  

 

Example 2

If a user enters this transaction:

                                    Transaction Date                      Period

Vendor Bill                   10/1/2010                              September 2010

Results: COGs will run as of 10/1/2010, even though the transaction posted to the books for September.

 

Things to know about the "New COGS":

• The COGS program will not change transaction amounts in closed periods - as long as there is no date/period mismatch (in other words the transaction date falls within the respective transaction period)
• The COGS program will run historically if a user manually edits a historical transaction or backdates a transaction
• Some users may have existing transactions with date/period mismatches.  As long as they do not edit any of those transactions, or backdate a new transaction, COGS will not run on these.

NetSuite does not support date/period mismatches.  We strongly encourage users to make sure the date always matches the period and to establish accounting preferences and period close processes to encourage enforcement of this.