In Megaventory, we take keeping track of every movement of the inventory very seriously. We believe that without this, an inventory and supply chain management system would lack value. However, we know that there are situations in which the original document is not valid or the dates are off. This is when backdating comes in handy, a feature that gives you flexibility while not losing track of the processes and documents.
You may be asking yourself, but what is backdating? It is just dating a document with an earlier date than its actual date of execution. This might not be allowed, or not even be legal, especially when it comes to legal documents such as contracts. However, in day-to-day business scenarios, there are many cases when backdating is necessary.
These are some common situations in which you might find it helpful:
When among all documents required when recording sales, purchases, inventories, etc. an invoice ends up not being issued without any dishonesty intended.
When for instance, a vendor supplies a product under a contract, and later discovers that the customer didn’t sign it. In this case, a contract with the date of the supply is more valid than inserting the actual date of execution.
When the original document has been lost or destroyed and a replacement of the missing one is required. In this case, both parties might agree on the backdating of the document.
When you are first starting to use Megaventory, and you want to record some bills and invoices on their real date.
What Megaventory offers is a backdating feature that allows for any document that is being created to have its date set in the past (at a maximum of 180 days or 6 months). Furthermore, an already issued document can be canceled and a new one put into its place, on a date prior to the issue date of the latter. For tracking purposes, both the canceled document and the newly issued one get a document number.
To correctly use the backdating feature in Megaventory, there are some things you should consider:
If you want to make a change in your stock level, Megaventory will check what your final stock will be. If you end up with negative physical stock at any point in time, even in the past, Megaventory will not let you create the new document. So just keep in mind that you must always keep a 0 or positive quantity for a product through your timeline.
If you want to push back a purchase invoice, you need to keep in mind that it will also affect the cost of the items involved, since the current unit cost of a product changes according to the Old Quantity x Old Unit Cost and the New Quantity x New Unit Cost. This weighted average cost method will trigger a change in the cost, since the Old Quantity will be modified by backdating a document. In this case, you should check with your accountant and/or lawyer for local regulation on how to handle this.
As simple as it sounds, backdating is a very useful feature! Fix the date of the invoice you neglected to issue on time, enjoying maximum flexibility while being able to map and follow what actually happened in Megaventory!