Re: Thoughts on Voiding Invoices

["Joshua D. Drake" <..hidden..>]

Chris Travers wrote:
> First, I am sorry you are offended.  Sometimes you come across as a
> bit... tense... It isn't that your feedback isn't appreciated, but
> sometimes that gets in the way.  I meant it as a friendly suggestion,
> nothing more.

David, just as a follow up to this, your comments are always greatly 
appreciated but I must admit that I agree with Chris here. You are a bit 
rough at times. Those who know me, know that I almost never (maybe 6 
times in the last 4 years) flame someone. You have almost made that list 
on more then one occasion :).

I just say this, because you are obviously a smart guy and a value to 
this project but you may want to tone down the strength of your opinions 
and revert instead to reasonable arguments based on your knowledge.

> As for the accounting matters, you are going to have to acually
> provide a strong accounting argument that this breaks GAAP.  My
> understanding of GAAP FIFO inventory calculation is that a voided
> invoice should not break the assumption of first-in, first-out.  I.e.
> if the invoice was never valid to begin with, the items sold would
> move on to subsequent invoices.  If you pull the prices back out of
> the middle, then you are screwing up your inventory calulations.

This is absolutely correct.

> To put it simply, voiding an invoice needs to bring it back to the
> values that would have been *if the invoice had never been issued in
> the first place.*  That is why last cost matters (and not actually

Here is some simple psuedo-code for you:

BEGIN;

INSERT INTO invoices VALUES('a','120.00');
ERROR: You can't sell part 'a' for 120.00.

ROLLBACK;

Yes it is a silly example but that is EXACTLY what void means. It is a 
ROLLBACK of the entire transaction. Which means the data is returned to 
the state that existed *before* the invoice was posted.

Obviously you have to take into account that we are dealing with a 
concurrent model which means other changes will take place while this is 
happening. Thus we can only reverse the specific changes and apply them 
to the now current set versus the old set.

> You seem to be the only one who disagrees with this.  Perhaps you can
> share with us some accounting resources that make your case?

I am 100% for changing my thoughts on this process but somebody needs to 
provide me with written statements to the effect backed by some 
accounting rules book or website.

Sincerely,

Joshua D. Drake