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Home > PDF Reports > Charts > Inventory Accuracy Scorecard > Boundary Alert



 
Boundary Alert
A Boundary Alert indicates an issue with a store's Inventory Value impacting Dollar Accuracy (Operational Level 2).  The problem area(s) are reported on the store's Exception Report.pdf (Pages 1 - 3 typically).  These are called "Boundary" reports because the affected SKUs are not reported on Mango's Count Sheets.pdf and their inventory value is excluded from Mango's Chart reports and metrics.  Therefore, these SKUs are outside Mango's "boundary".  However, they are inside your store's POS system and most likely impacting your store's ability to report accurate financial information and track shrinkage accurately.

Generally speaking, these are impactful easy-to-fix errors and should be treated as a high priority.  Boundary errors are divided into three classes:

Three classes of Boundary Exceptions
1) Cost/QOH Errors
2) Store Supply/Coupon Errors
3) Negative Value Errors

**Warning - significant swings in inventory value can impact your store's reported Gross Profit.  Please make corrections with your owner's / CPA's knowledge.


1) Boundary Cost Errors Exception (click for more information)


In the example above, one SKU is (falsely) creating $7,000 of inventory value (QOH x Cost).  Until corrected, this error creates an imbalance between what the store paid and the resultant inventory value.  The net result will falsely create $7,000 of taxable gross profit.  The source of the error should be investigated and the error be undone using the same source.  For example, if it was a purchasing error then the error should be corrected in the purchasing system rather than through PIP, etc.

2) Boundary Store Supply Exception (click for more information)

 
The example above shows items contributing to a store's ending Inventory Value (QOH x Cost), however this class of "inventory" is not available for sale and really should not be classified as such (and incorporated into your store's ending inventory/balance sheet).  The solution is to zero-out the SKU's QOH so that it does not contribute to ending inventory value.  There are several ways to zero out the SKU's QOH: PIP/IMU, Keep Stock Info=N, or a Credit PO.  The recommended ongoing method is to utilize a Credit PO.  If the value is significant, please make sure your owner and/or CPA approves the method and knows the total dollar amount corrected and which method was used to zero out QOH as some sort of general ledger adjustment may be necessary.

3)

Negative Value - Office Exceptions

 

This report identifies SKUs in your system that have significant negative value or have negative quantity on hand month after month. This condition can indicate a purchasing issue or a Keep Stock Info misconfiguration. Significant negative value in ending inventory can obscure dollar value and can cause erroneous shrinkage to be reported. Generally, stores exclude negative value from their reported ending inventory by utilizing an option within their RIV report. However, this option is not consistently set across stores or even within the same store (different options for month-end and year-end). Because of these adverse accounting risks, negative value should be minimized. This report is part of Level 2 - Dollar Accuracy Boundary reports.


 
  
 
 
 

You can find a full, multi-store listing in the MEGA Report located in your Data Import directory.

Steps to download your report can be found here.

    What is Keep Stock Info?

 

Steps to Process this Report: 

 

1. Determine if the SKU is a "dump SKU", or if the SKU was not received correctly. 

 

Dump SKUs should have their "Keep Stock Info" set to N in the codes tab of Inventory Maintenance. This will blank out the SKU's QOH but keep sales information. This is the correct setting for SKUs like your general fastener sales (or dump) SKU.


 

    Negative Dollar Value Risks


    Report Example