Sometimes, you’ll find that you need to adjust your inventory levels in NetSuite. Adjusting inventory in NetSuite is a simple matter of understanding certain aspects of your inventory and costing processes and then selecting the correct method in NetSuite to accommodate those processes. Let’s take a look. 

Two Ways to Adjust Inventory

NetSuite provides two ways to adjust inventory: an Inventory Adjustment or the Inventory Worksheet. The method you choose will depend on which features you need. 

Inventory Adjustment

First, the best option for you to change your inventory count for a certain item might be the “Adjust Inventory” form. You would use this form if the adjustment you need to make will add an amount of inventory to your previous stock levels. This method is the only way to adjust serial and lot numbered items. It allows you to bypasses the typical method of adding or subtracting inventory in NetSuite via either a PO or SO, which is a more frequent need than you might think. Some scenarios when you would need to change your inventory counts outside of a PO or SO include human error in data entry, inventory spoilage, or even theft. 

When you use the Adjust Inventory form, you can change both the amount of the inventory you have on hand as well as the value of that inventory. If you use LIFO or FIFO, this method will apply your costing preferences to the item(s) that you adjust. 

To create an Adjust Inventory record, navigate to Transactions > Inventory > Adjustment. On this form, some of the main line fields you will need to fill in include the subsidiary where the change is being made (for users with OneWorld); the adjustment account where the value of the adjusted inventory will be recorded; the date of the adjustment; and the posting period. You can also associate the adjustment with a particular department, class, or location. 

Under the Adjustment tab, you will include the details of the actual adjustment. On this tab, chose the item and the location for the item. Doing this will auto-populate the Description, Quantity on Hand, and Current Value fields. To change the quantity of the item, enter the number of the adjustment in the Adjust Quantity By field. You would enter a positive number for an inventory addition, and a negative number for an inventory subtraction. After adding one item, you may repeat this process for as many items as you need to make adjustments for.

Inventory Worksheet

Your other option is to use the Inventory Worksheet, which you can use for inventory items that are not serial or lot numbered. Unlike the Adjust Inventory form, the adjustments you make on an Inventory Worksheet represent the total amount of each item you have in inventory, rather than simply the amount being added or subtracted to the total. It’s kind of like a mass update for inventory count. A common use case for this method would be to record the total amount of certain inventory items after you perform a manual inventory count in your warehouse for those items. 

When you use the Inventory Worksheet, the amount you record for any given item will overwrite any previous entries for that item. Any transactions that are dated prior to the date of the Inventory Worksheet will not change the inventory count made by the Inventory Worksheet. And when it comes to the day that you create the Inventory Worksheet, you will determine on the worksheet itself whether the change you are making will be logged as the first entry of the day for the day it is made or as the last transaction of the day. If it is recorded as the last entry of the day, then it will overwrite any previous entries made for that item on that day. 

Unlike the Adjust Inventory form, the Inventory Worksheet does not accommodate LIFO or FIFO. Rather, it will average the cost of each item. If you use LIFO or FIFO in your inventory accounting and you don’t want an item’s costing history to be averaged, then you should use the Adjust Inventory form instead of the Inventory Worksheet. 

To create an Inventory Worksheet, navigate to Transactions > Inventory > Adjust Inventory Worksheet. On this worksheet, you will select an adjustment account where the inventory value changes will be recorded, the date of the change, the subsidiary (for companies that use OneWorld), and a specific location. This will bring up a complete list of all the items that are associated with that location in that subsidiary. 

You can filter the list of items by active or inactive items, but note that serial and lot numbered items will not appear in this list. In the list, you can enter the total new quantity for specific items in the New Quantity field, and the total new value for those items in the New Value field. Once you save this record, any of the changes you made will completely overwrite the total counts and values for those inventory items. 

Conclusion

Adjusting inventory in NetSuite is quite simple if you understand how the Adjust Inventory form and the Inventory Worksheet function. In future blogs, we’ll keep walking through the details of inventory management in NetSuite. To keep up with future posts, be sure to join the SuiteRep newsletter below!