When we are called into consult with a new client who either set up POS themselves or had another consultant work on it, the most common problem we see is a negative amount in the POS inventory adjustment expense. This indicates that the client has not been receiving inventory in properly. Most commonly, the client will just enter quanities of items in the on-hand field. While POS does warn you that you are creating an adjustment, you can hide the message and most do. What is happening is that you are telling POS that you have X qty at Y cost and therefore it increase the inventory and the offset is placed into POS inventory adjustment expense. Since both accounts are debit accounts, the expense is driven negative.
How to fix: First of all, you must receive all inventory in on receiving vouchers. Secondly, depending on how long this has been going on, the fix can be as simple as changing all of the check/or bills entered from whatever is listed to POS inventory adjustment expense. We can consult with you regarding the specifics of your case as well as provide training on POS done right. Give us a call
