Purchase Returns

In case a purchased item turns out be defective, we as a customer have no other choice other than to return it or ask for a credit note for that item. SAP business One has provisions for both the cases. SAP business one tactfully handles the situation of purchase returns with two major forms ‘Goods Return’ and ‘A/P Credit Memo’.

 

·       Goods Return: - The goods return document is used to return delivered goods to vendors or to reverse a purchasing transaction either completely or partially. A Goods Return is entered after a GRPO is posted but before an A/P Invoice posting is made. Due to legal reasons, you cannot delete or make any accounting-relevant changes to the GRPO. However, to return unwanted or faulty goods, or to correct errors made when entering a GRPO, you can create a goods return. When you create a goods return, the goods are issued from the warehouse and the quantities are reduced. If your company uses perpetual inventory, SAP Business One automatically creates the relevant posting to update the inventory values as well.

·       A/P Credit Memo: - When you create an A/P invoice in SAP Business One, legal stipulations prevent you from deleting or making any changes to these documents. You may, however, want to return the goods to the vendor for a variety of reasons, or you may find that you have made a mistake while creating the documents. The A/P credit memo is the clearing document for the A/P invoice. Therefore, if the vendor has delivered goods, and you have already created an A/P invoice, you can reverse the transaction either partially or completely by creating an A/P credit memo.

 

There is also an additional document, Goods Return Request, which aids in purchase return process. Consider a scenario where your purchase process and purchase return process are handled by different people. In the above scenario, the Goods Return Request document can act as an approval document. The way it works is, the person in charge of purchasing is informed that there are several defective items that needs to be returned. It is then the duty of the purchasing in charge to immediately raise a Goods Return Request seeking an approval and action form the employee that handles purchase returns in returning the defective items.