This article provides information on the way deleted inventory items can be accounted for in Paladin.

Note: Inventory items are not “deleted.” They are inactivated and can be restored. For more on this, see the KBA: How to restore/activate an inventory item

Deleting an inventory item with non-zero stock-on-hand
When you delete an inventory item that has stock-on-hand, the item is removed from active inventory, and the stock-on-hand (SOH) quantity is converted to shrinkage.

Deleting an inventory item that is on backorder is not allowed
An inventory item that has open purchase orders is considered to be on backorder and cannot be deleted (removed from active inventory). Active inventory items are required for purchase order receiving.

Deleting an inventory item that will not be fulfilled

If the backorders for an item will not be fulfilled, you can cancel them on each purchase order, and then delete the inventory item. You can also cancel all backordered items on a single purchase order. 

To cancel all backorders of an item:

  1. In Paladin, on the top ribbon, select the Inventory module.
  2. Search for the inventory item, and open it.
  3. On the Inventory tab, click the On Order magnifying glass.
  4. In the Qty On Order window, highlight any backorder. Note: To find backorders, look for orders where the B/O Canceled checkbox is not selected, and the Qty B/O value is greater than zero.
  5. Click F8 Cancel Backorder.
  6. In the Cancel Backorder window, click Yes.
  7. Perform steps 5-8 again for all additional backorders.
  8. Click Done.

To cancel all backordered items on a purchase order:

  1. In Paladin, on the top ribbon, select the PO module.
  2. On the bottom ribbon, on the Mode button, make sure the Receive option is selected. Note: If Receive is displayed in black letters, this option is selected. If it is in gray letters, click Mode to select the Receive option.
  3. On the bottom ribbon, click Find PO.
  4. In the Find PO window, use the PO Details search fields to find the purchase order.
  5. In the Matching Purchase Orders pane, highlight the purchase order with the backorders that you want to cancel.
  6. Click Cancel B/O.
  7. In the Cancel Backorder window, click Yes.
  8. Click Cancel to close the Find PO window.

How to find backorders that were never received and stop revenue loss
An item may be out-of-stock, and you don’t know it because a backorder was only partially fulfilled. Today, most suppliers will fill a purchase order with the items they have on-hand even if the number of items is less than you ordered. Typically, suppliers don’t follow up, and you never receive the remaining items. EDI processing normally closes these purchase orders, but orders from non-EDI suppliers may remain open indefinitely. When this happens, you may run out of items and lose sales because you are not aware of the outstanding backorders.

You can prevent this revenue loss by regularly reviewing older open purchase orders and cancelling the backorders that will not be fulfilled.

To review older open purchase orders:

  1. In Paladin, on the top ribbon, select the PO module.
  2. Click Find PO.
  3. In the Find PO window, in the PO Details pane, select Open POs.
  4. On the bottom ribbon, on the Mode button, make sure the Receive option is selected. Note: If Receive is displayed in black letters, this option is selected. If it is in gray letters, click Mode to select the Receive option.
  5. In the Matching Purchase Orders pane, click the PO Date column title to sort the open purchase orders from oldest to newest.
  6. Evaluate older purchase orders to determine why they are still open. To open a purchase order, double-click it.
  7. See the annotated picture of purchase order below and use the following information to help you make decisions about the purchase order.
    • Backordered items have non-zero Received quantities.
    • If the backordered quantity (Received) is less than the ordered quantity (ORD), then the order was partially fulfilled, and the remaining order will likely never be received.
      Shows the receive PO screen with callouts for the ways to delete back orders and how to read the ORD, REC and Received fields for an item on a PO
  8. If the purchase order will not be fulfilled, cancel backordered items in the purchase order and then process the purchase order.
    1. Select backordered items to cancel. Note: This sets the backorder quantity to zero. In the Receive PO pane, select the Del checkbox for each backordered item you want to cancel.
      -or-
      Select the top Del checkbox to cancel all backordered items.
    2. On the bottom ribbon, click Process. The Confirm PO tab displays.
    3. On the bottom ribbon, click Process.
    4. In the PO Freight window, click OK.
  9. Repeat steps 3 thru 9 to evaluate and process other older purchase orders.

Note: The accounting changes we implemented supports the Generally Accepted Accounting Principles (GAAP) standard.

If you have questions or suggestions about this information, contact support@paladinpos.com.

*Content is subject to change. For the most recent version, visit the Help Portal.
Printed on: 5/20/22