Sunday, May 7, 2017

Negative Inventory & Prevention

Hi Folks,

I believe that most of us have already came across having negative inventory in Odoo due to various reasons which normally, customers do not expect so I would like to share my thoughts on having negative inventory & valuation in Odoo with reasons and prevention for it. 


I did make some analysis that why Odoo creates negative inventory in which I may miss something. Normally, if we consume or ship or move more than available in inventory, we can have negative inventory and here is what, I found:

Most common reason is to click on "Force" buttons on Shipment and Manufacturing orders. Normally, we should avoid it and hide it before we go live. It is a good practice to do it.

During shipping to the customer, Odoo allows you to enter more than ordered quantity but during validation of the Shipment, if you enter more than available, Odoo creates a negative inventory for extra quantity.

Same case for Manufacturing, if you enter more than available quantity during validating Manufacturing order, Odoo creates a negative inventory for extra quantity.

During transfer of stock, if you move your products from wrong lot number in which you never received of you do not have enough quantity for it, Odoo creates a negative inventory for extra quantity.


First of all, we can hide the "Force" buttons from the Shipment and Manufacturing Orders screen.

We can add restriction during validating Shipment and Manufacturing orders for stopping users to validate them with more than available quantity, we should be find with more than ordered quantity.

We can also add restriction during transferring products from wrong lot number, in which we never received, during validating Internal transfer. 


It is a good practice to stop it in advance, before we go live, specially if we are working with Real time configuration as each and every transfer create accounting entries. We can have a negative inventory with big numbers and same can reflect in accounting entries which will be difficult to fix and improve later. 

I hope this post will be helpful and your comments are welcome.
Thank you and good luck!

Friday, February 3, 2017

Production Cost at the end of Manufacturing in Odoo

Hello Everyone,

How to calculate Production Cost with Raw material Cost and Work-center Cost ? How to create accounting entries for it ? This is what I will try to explain in the post. The post is for having the functionality in the Odoo v<10.0.


  • Create a Work-center with required information like cost, cost account, financial account, etc.
  • Create a Routing and link the Work-center with it. Link the Routing with Bill of Materials of the Finished good product.
  • Set Stock Valuation Account (Incoming & Outgoing) in 'Production' Location by having any Asset type of account. It is called a WIP account and will be used to track the cost during the Production process.
  • In the Category of Finished good product, Set Costing Method as a Real Time and set Valuation account by having any Asset type of account.


  • Once the configuration has been correctly set, Proceed to create a Manufacturing order.
  • Select the Product you want to produce with Bill of Material and the Quantity.
  • Click the Confirm Production button and Work order will be created for the Work-center, linked with the Routing.
  • Reserve the order, Mark it as Started and Produce it. Set the quantity in the wizard which should be produced.

As the end of the Production order, 

  • Odoo create a move for Raw materials from Stock to Production and update Inventory valuation with the cost of raw materials in the Quant.
  • Odoo also create accounting entry for the Raw material cost by debiting WIP account set in the Production Location and crediting Valuation account from Product category.
  • Odoo create a move for Finished good from Production to Stock and update Inventory valuation with the Raw material cost + Work-center cost.
  • Odoo also create accounting entry for the Raw material cost + Work-center cost by debiting Valuation account from Product category and crediting WIP account set in the Production Location.
  • Odoo also create a separate Analytic entries for the Work-center cost and link the financial account set in the Work-center.

By configuring and executing the way, I explained, we can calculate the production cost with accounting entries in Odoo. I hope that the post would be helpful to you.