Introduction to the Returned Goods Register

Use this register when goods that you have delivered to your Customer are returned to you. A record in the Returned Goods register is always connected with a Sales Order, and it can be either a full Return or a part Return. You cannot use Returned Goods if you do not have the Sales Orders module.

The difficulty with the returning of goods to stock is to establish the actual value of the goods being returned. The purpose of the Returned Goods register is to allow you to record values that are as accurate as possible. The Original Cost on Returned Goods option in the Cost Accounting setting will help you achieve this. For example, if you are using the Queued Cost Model (FIFO or LIFO) Cost Model, you should receive the Item back into stock with the same value as when you delivered it. If you are using the Weighted Average or Cost Price Cost Models, the Weighted Average or Cost Price may have changed in the time between delivery and return.

When you approve and save the Return, the stock levels of the Items used will be amended accordingly as will the Nominal Ledger stock valuation of any Stocked Items used (if you have chosen in the Sub Systems setting in the Nominal Ledger and in the Number Series - Returned Goods setting to have such Transactions created). The Nominal Ledger stock valuation of any Plain Items will only be updated if you are using the Cost Accounting for Plain Items option in the Cost Accounting setting. You can then raise another Delivery (if you will be sending out a replacement) from the Sales Order screen. If you need to issue a Credit Note (if an Invoice has already been issued and no replacement is required), you can do so from the Returned Goods record or from the original Invoice.

To view Returns already entered, ensure you are in the Stock module and click the [Returned Goods] button in the Master Control panel. The 'Returned Goods: Browse' window is opened. Returns are normally shown in number order. For each is shown a Return Number, an indication of whether the Return has been approved in the OK column, Date and Comment. As in all browse windows, you can re-sort the list and search for particular records.

Entering a Return

You cannot enter records directly to the Returned Goods register. Instead, you must create a new Return using one of two methods:
  1. With a Sales Order open, select the 'Create Returned Goods' command from the Operations menu. This creates a new record in the Returned Goods register. For the command to have any effect, you must first save all changes to the Sales Order (use the [Save] button) and you must have issued and approved at least one Delivery from the Order.

  2. With a Delivery open, select the 'Create Returned Goods' command from the Operations menu. This creates a new record in the Returned Goods register. For the command to have any effect, you must have saved all changes to the Delivery (use the [Save] button) and it must have been approved.
If you are using the Original Cost on Returned Goods option in the Cost Accounting setting, you are using the option to insert Returned Goods at their original position in the FIFO/LIFO cost queue in the same setting and/or you are using the Do Not Allow Return Goods From Order option in the Order Settings setting, you must use the second method. If you are using at least one of these options, you cannot create Returned Goods records from Sales Orders. If you are not using any of these options, but at lease one of the Items on a Sales Order uses a Queued Cost Model (FIFO or LIFO) then again you must create the Return from the relevant Delivery.

Note that the record is presented in a 'Returned Goods: Inspect' window. This means that the record has already been created and saved into the register. To delete it you must choose 'Delete' on the Record menu.

Entering a Return - Header

No.
Paste Special    Select from another Number Series
The serial number of the current Return. The default is the first unused number in the first valid number sequence in the Number Series - Returned Goods setting. You may change this number, but not to one that has already been used. If you are working in a multi-user environment, the Returns Number is assigned when you first save the record.

Trans. Date
Paste Special    Choose date
The date of the Return. The default is the current date.

Customer
The Customer Number from the Order or Delivery.

Name
The Customer Name, taken from the Order or Delivery.

Entering a Return - Location Card

Location
Paste Special    Locations setting, Stock module
Default taken from    Order or Delivery
The Location into which the Items are to be returned. If you have specified a Main Location in the Stock Settings setting, leaving the field blank means that the Main Location will be used.

This field must contain a value if you are using the Require Location option in the Stock Settings setting.

Update Stock
Use this option if you need stock levels for the Items on the Return to be altered and a Nominal Ledger Transaction to be created when you approve the return. If the Item being returned is to be written off, you can then do so using a Stock Depreciation record or a Returned Goods to Supplier record, depending on the circumstances.

If you switch this option off, stock levels for the Items on the Return will not be updated, and a Nominal Ledger Transaction will not be created when you approve the Return (even if you have so specified in the Sub Systems setting in the Nominal Ledger and in the Number Series - Returned Goods setting). So, you may want to switch this option off if the Item being returned is to be written off immediately.

Order No.
The serial number for the Sales Order from which the Returns record was created. This field cannot be changed.

Price Incl VAT
Check this box if the Unit Prices for the Items on the Return include VAT.

Comment
Any comment entered here (perhaps the reason for the return) will be shown in the 'Returned Goods: Browse' window.

Reduce
Use these choices to control the effect of the Return on the Sales Order from which it was created.
Delivered Quantity
This option reduces the Del 1 and Del 2 quantities only. You should use it when goods are returned because they are faulty (i.e. the Customer requires a replacement). Then, after approving the Returned Goods record, you can return to the Order to raise another Delivery for the appropriate quantity to fulfil the Order. In this instance you may choose to treat the Item as written off. If you need to return the Items to your Supplier, it is recommended that you update stock levels and then enter a Returned Goods to Supplier record (if you originally purchased the Items using a Purchase Order) or a Stock Depreciation record (if there is no originating Purchase Order).

Ordered and Delivered Qty
This option reduces the Del 1 and Del 2 quantities and the Order quantity. You should use it when goods are returned without a replacement being required (perhaps the Customer has cancelled the Order). In this case, choose to reduce the ordered quantity and to update stock levels. If the Order has been invoiced, selecting 'Create Credit Note' from the Operations menu of the Returned Goods record will create a Credit Note with appropriate Payment Terms and a reference to the Invoice being credited. If more than one Invoice has been created from the Sales Order, you will not be able to create the Credit Note from the Returned Goods and instead will need to do so from the Order or from the Invoice to be credited.
To specify which of these options is chosen by default in a new Returned Goods record, use the Returned Goods Settings setting.

Entering a Return - Items Card

Use the grid on the 'Items' card to list the Items being returned. This information is taken from the Order or the Delivery from which the Return was created, and the default quantity for each Item is that already delivered. Items on the Order with a delivery quantity of zero will not be shown. Enter the returned Quantity for each Item and remove any Items not returned by clicking on the row number to the left and pressing the Backspace key. If you are not using the Original Cost on Returned Goods option in the Cost Accounting setting and/or you are not using the option to insert Returned Goods at their original position in the FIFO/LIFO cost queue in the same setting, you can change the Item Cost of the Returned Item, although this is not recommended. If you have incurred any costs in receiving an Item back into stock, it is recommended that you do not change the Item Cost but instead enter an Extra Cost.

Flip A

Item
The Item Number from the Order or Delivery.

If an Item being returned is a Structured Item, you should list its components in the Return, not the Structured Item itself. Structured Items are built the moment the Delivery is made and are not kept in stock themselves. Therefore, they should not be included on a Return. Only the components should be listed on the Return: this will ensure they are correctly received back into stock.

Qty
Enter the quantity returned (the default is that delivered, less any that have already been returned). You can reduce this figure, but not increase it.

Description
The Item Name from the Order or Delivery.

Item Cost
The unit Cost Price of the Item being returned.

In the case of Returns created from Deliveries, if you are using the Original Cost on Returned Goods option in the Cost Accounting setting, the default will be a unit price calculated from the Row FIFO figure on flip C of the originating Delivery. If you are not using this option, the default Item Cost will be the Cost Price from the Item record.

In the case of Returns created from Orders, the default will be the Weighted Average, Cost Price or percentage of Base Price of the Item, depending on the Cost Model. If the Item uses a Queued Cost Model (FIFO or LIFO), you will not be able to create the Return from the Order, because Queued values are not stored in Orders.

If you are not using the Original Cost on Returned Goods option in the Cost Accounting setting and/or you are not using the option to insert Returned Goods at their original position in the FIFO/LIFO cost queue in the same setting you can change the Item Cost, although this is not recommended. If the Item in question is one that has its Cost Price updated on Goods Receipt using the Weighted Average option (set on the 'Costs' card of the Item record) and if you are using the Update Weighted Average from Return Goods and Credit Notes option in the Cost Accounting setting in the Stock module, any change in Price here will be fed back to that Cost Price automatically. The FIFO/LIFO value of the Item will be adjusted accordingly.

Extra Cost
Any additional cost (per unit) incurred by your company in having the item returned. It will be shown added to the Item Cost in the Cost Price column. Either enter an amount in Currency, or a percentage followed by the % character. You can only add an Extra Cost if you are not using the Original Cost on Returned Goods option in the Cost Accounting setting and/or you are not using the option to insert Returned Goods at their original position in the FIFO/LIFO cost queue in the same setting.

If a Nominal Ledger Transaction is generated from this Return (this is determined using the Sub Systems setting in the Nominal Ledger and in the Number Series - Returned Goods setting), any costs in this field are credited to the Extra Costs Account specified in the Account Usage Stock setting and included in the debit posting.

The FIFO/LIFO value of the Item will not be affected by the Extra Cost but, if you are using the Update Weighted Average from Return Goods and Credit Notes option in the Cost Accounting setting, the Extra Cost will be included in the Weighted Average calculation for the Item. The Extra Cost will therefore be fed back to the Cost Price of the Item if you are using this option and if the Item is one that has its Cost Price updated on Goods Receipt using the Weighted Average option (set on the 'Costs' card of the Item record).

Unit Cost
The Unit Cost of the Item in the Currency of the Return, including any Extra Costs.
Flip B
Objects
Paste Special    Object register, Nominal Ledger/System module
Default taken from    Order row
You can assign up to 20 Objects, separated by commas, to this Item and all transactions generated from it. You might define separate Objects to represent different departments, cost centres or product types. This provides a flexible method of analysis that can be used in Nominal Ledger reports.

By default, the Objects entered here are taken from the Order or Delivery row to which the Return row corresponds, but you can change them if necessary. Usually these Objects will represent the Item.

In any Nominal Ledger Transactions generated from this Return, any Objects specified here will be assigned to the credit posting to the Cost of Sales or Returned Goods Account. This assignment will merge these Objects with those of the parent Return (shown on the 'Currency' card).

Serial No.
Paste Special    Serial Numbers of Items in stock
If the Item uses Serial Numbers or batch numbers, you must enter a valid Serial Number here.

In the case of Returns created from Deliveries, this field will contain a default, taken from the Items that have already been delivered. In the case of Returns created from Orders, there will be no default, because the Serial Numbers of delivered Items are not all stored in Orders if the Order Quantity is greater than one.

If you are using the No Serial No. on Goods Receipts option in the Stock Settings setting, it will not be compulsory to enter Serial Numbers, and a Quantity greater than 1 will be allowed.

Best Before
In the case of perishable goods, enter a Best Before date here. The default will be taken from the Items that have already been delivered from the Order.
Flip C
Position
Paste Special    Position register, Warehouse Management module
If the Location specified in the header is a large one that has been sub-divided into Positions, enter here the Position where the Item is to be stored. The Position must be in the correct Location. The 'Paste Special' list only lists Free Positions (Positions that are empty). If you created the Returned Goods record from a Delivery, a default Position will be taken from that Delivery.

Recipe
The Recipe for Structured Items is entered here. This field cannot be changed.

Width, Height, Depth
Default taken from    Item
These fields contain the dimensions of the Item.

If the Item is one that is sold by area or volume, you can have the Quantity calculated by multiplying the dimensions together. If you would like to use this feature, first check the Enable Quantity Calculation box in the Item Settings setting in the Sales Ledger. Then, check the Calculate Quantity box for the Unit that has been assigned to the Item. If the Item is sold by area, choose the Two Dimensions option in the Unit record, and the Quantity will be calculated once you have entered the Width and Height. If the Item is sold by volume, choose the Three Dimensions option in the Unit record, and the Quantity will be calculated once you have entered the Width, Height and Depth. Please refer to the page describing the Units setting for details and an example.
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OK
Check this box to approve the Return. After saving the approved Return you will no longer be able to change it. If you have switched on the Update Stock option ('Location' card), stock levels will be amended. If you have determined in the Sub Systems setting in the Nominal Ledger and in the Number Series - Returned Goods setting that cost accounting transactions are to be generated from Returned Goods records and you have switched on the Update Stock option, stock transactions in the Nominal Ledger will be raised.

You must approve the Return before you can raise a Credit Note for it.

References in these web pages to approved Returns are to those whose OK check box is on.

Qty
This shows the total number of Items returned.

Entering a Return - Currency Card

Currency
Paste Special    Currency register, System module
The Currency of the Return.

Exchange Rates
Default taken from    Base Currency Rates setting and/or Exchange Rate register, System module
The current exchange rate will be entered by HansaWorld Enterprise.

One of two conversion methods will be used. The Dual-Base system will be useful for companies that have offices in two countries that need to report in both Currencies, for companies operating in countries where there is a second Currency (usually the US Dollar or Euro) in common use in addition to the national one, and for companies in the Euro zone who retain their old national Currency for comparison purposes. The second method is a simple conversion from the foreign Currency to the home Currency, applicable to the majority of worldwide Currency transactions. These are described below.
Exchange Rates (Dual-Base System)
If you are using the Dual-Base system, the Base Currency 1 and 2 fields on the left show in the form of a ratio the exchange rate between the two base Currencies (taken from the latest record in the Base Currency Rates setting).

Note that European Monetary Union (EMU) regulations specify that the ratios must always show how many units of the home or foreign Currency can be bought with one Euro.

Exchange Rates (Simple Currency Conversion System)
In the case of a simple currency conversion system, the Rate and right-hand Base Currency 1 fields are used to show a simple exchange rate between the foreign and home Currencies.
Objects
Paste Special    Object register, Nominal Ledger/System module
Default taken from    Order, 'Date' card
You can assign up to 20 Objects, separated by commas, to this Return and all transactions generated from it. You might define separate Objects to represent different departments, cost centres or product types. This provides a flexible method of analysis that can be used in Nominal Ledger reports.

By default, the Objects entered here are taken from the Order from which the Return was issued, but you can change them if necessary. Usually these Objects will represent the Customer and the Salesman.

In any Nominal Ledger Transactions generated from this Return, any Objects specified here will be assigned to the credit posting to the Cost of Sales or Returned Goods Account.

Reason
Specify the reason for the Return. You can modify this field after the Return has been approved.

Entering a Return - Comment Card

This page describes the fields on the 'Comment' card in the Returned Goods record window. Please follow the links below for descriptions of the other cards:
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Comment
Any comment entered here (perhaps the reason for the return) will be shown in the 'Returned Goods: Browse' window.

The Comment field will remain editable after marking a Return as OK and saving.
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The Returned Goods register in Standard ERP:

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Nominal Ledger Transactions from Returns

When you approve and save a Returned Goods record, a Nominal Ledger Transaction will be generated automatically if you have so determined in the Sub Systems setting in the Nominal Ledger and in the Number Series - Returned Goods setting, and if at least one of the Items on the Return is a Stocked Item (or a Plain Item if you are using the Cost Accounting for Plain Items option in the Cost Accounting setting).

The Stock Account debited by such Transactions is determined as follows:

  1. The Stock Account for the specified Location will be debited.

  2. If this is blank or if you have not specified a Location, and if you are using the Use Item Groups for Cost Accounts option in the Cost Accounting setting, the Stock Account for the Item Group to which the Item belongs will be debited.

  3. In all other cases, the Stock Account in the Account Usage Stock setting will be debited.
The Cost of Sales or Returned Goods Account credited by such Transactions is determined as follows:
  1. The Cost Account for the Item will be credited.

  2. If this is blank and you are using the Use Item Groups for Cost Accounts option in the Cost Accounting setting, the Cost Account for the Item Group to which the Item belongs will be credited.

  3. In all other cases, the Returned Goods Account specified in the Account Usage Stock setting will be credited.

  4. If the Returned Goods Account is blank, the Cost Account specified on Account Usage Stock setting will be credited.
If there are any Extra Costs, these will be posted to the Extra Costs Account specified in the Account Usage Stock setting.

Any Objects in the Return (both those on the 'Currency' card representing the Customer and the Salesman and those on flip B of the 'Items' card representing the Item) will be assigned to the credit posting to the Cost of Sales or Returned Goods Account.

Below is shown an example of a Nominal Ledger Transaction created from a Return:

If you are using the Negative Amounts option in the Transaction Settings setting in the Nominal Ledger, the Transaction will be slightly different, with negative amounts being credited to the Stock Account and debited to the Cost of Sales or Returned Goods Account.

Once the Transaction has been generated, you can look at it straight away using the 'Open NL Transaction' function on the Operations menu (subject to access rights set in the Access Groups setting in the System module).

Returning Goods when there is no Delivery

You can deliver goods from stock without a Sales Order or Delivery. This process is described on the Deliveries from the Sales Ledger page. In this circumstance, because of the lack of a Sales Order, if such goods are returned to you, you cannot use the Returned Goods register to receive them back into stock.

Instead, follow these steps:

  1. You will originally have issued such an Item using an Invoice. You should credit this Invoice, using the procedure described on the Credit Notes page. When you create the Credit Note and change the Payment Terms field to "CN", the Update Stock check box on the 'Delivery' card will be switched off automatically. You should not switch it back on again especially if you are using a Queued Cost Model (FIFO or LIFO) because doing so will mean that the Nominal Ledger stock valuation will become inaccurate (the stock valuation may be updated with an incorrect FIFO value). Instead, approve the Credit Note (to update the Sales Ledger and the Debtor, VAT and Sales Accounts in the Nominal Ledger).

  2. Receive the Item back into stock using the Goods Receipt register in the Stock module. This will correctly update stock levels and, if you have so determined in the Sub Systems setting and in the Number Series - Returned Goods setting, the Nominal Ledger stock valuation.

    In the interests of stock accuracy, it is recommended that you set the cost prices manually in the Goods Receipt record. You may need to find out the true value of the returned goods from the original Invoice record first (the FIFO field on flip C shows the average unit FIFO value of the Items delivered).

Operations Menu

The Operations menu for the 'Returned Goods: New' and 'Returned Goods: Inspect' windows is shown above. There is no Operations menu for the 'Returned Goods: Browse' window.

Operations Menu - Returned Goods - Item Search

This page describes the 'Item Search' function on the Operations menu in the Returned Goods record window. If you are using iOS or Android, the 'Item Search' function is on the Tools menu (with 'wrench' icon).

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If you are using the Allow Returned Goods Not Linked to Orders option in the Returned Goods Settings setting, you will be able to add rows to a Return that you created from another record such as a Delivery or Work Sheet, and you will be able to add records directly to the Returned Goods register. One way to search for Items that you can then add to a Returned Goods record is to use the 'Item Search' function. This function is therefore an alternative to the 'Paste Special' feature.

To use this function, place the insertion point in the Item field in any row and then select 'Item Search' from the Operations menu (Windows/macOS) or Tools menu (iOS/Android). The following window opens:

Search for
Enter here the string (e.g. part of an Item Number or Name) that you are looking for. You must make an entry in this field, otherwise no search will be carried out.

Classification
Paste Special    Item Classifications setting, Sales Ledger
If you enter an Item Classification here, the search for the string that you specified in the field above will be restricted to Items belonging to that Classification.

Search In
Specify the field in which you want to search.
Press [Run] to activate the search. A report will be printed to screen, listing the Items found. If you click (Windows/macOS) or tap (iOS/Android) on an Item Number in the report, the Item will be added to the Returned Goods record in the first empty row. You can keep the report open and click or tap on more Item Numbers to have more Items added to the Return.

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The Returned Goods register in Standard ERP:

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Operations Menu - Open NL Transaction

When you approve and save a Return, if so defined in the Sub Systems setting in the Nominal Ledger and in the Number Series - Returned Goods setting, a Nominal Ledger Transaction will be created. This function allows you to view that Transaction.

When you select this function, the Transaction will be opened in a new window.

You can use Access Groups to control who can use this function. To do this, deny access to the 'Open Transactions from Operations Menu' Action.

Create Menu - Returned Goods

The Create menu for the 'Returned Goods: New' and 'Returned Goods: Inspect' windows is shown above. If you are using iOS or Android, you can access the Create menu functions through the + menu.

The standard 'New' and 'Duplicate' functions will only be visible if you are using the Allow Returned Goods Not Linked to Orders option in the Returned Goods Settings setting. Use these functions to create new records, in this case in the Returned Goods register. Please follow the links below for details about the other function.

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The Returned Goods register in Standard ERP:

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Operations Menu - Create Credit Note

When you have invoiced an Order and goods are returned without a replacement being required (perhaps the Customer cancelled the Order), use this function to issue a Credit Note. You must first have approved and saved the Return, and you must first have created an Invoice from the Order.

When you select the function, a new record will be created in the Invoice register and opened in a new window, entitled 'Invoice: Inspect'. This means that it has been created and saved and is being opened for amendment and approval.

The Payment Terms of the Credit Note ("CN" in the illustration) are taken from the first record in the Payment Terms setting that is of the "Credit Note" type. If you have only created one Invoice from the Order, its Invoice Number will be shown in the first row of the grid, stating that it is the Invoice being credited. If this is wrong, you can change it, using 'Paste Special' if necessary to bring up a list of open (unpaid) Invoices. If you have created more than one Invoice from the Order, the first row will not have an Invoice Number (i.e. there will be no reference to the Invoice being credited) because HansaWorld Enterprise will not be able to establish which Invoice is to be credited. You will be able to specify this yourself, again using 'Paste Special' if necessary. If you are using the Do Not Allow Credit Invoices Without No. option in the Account Usage S/L setting, you will not be able to approve the Credit Note until you have done this. In this situation, an alternative method of creating the Credit Note is to find the original Invoice (using the Attachments feature from the Order or Delivery) and select 'Create Credit Note' from the Operations menu.

As soon as you create the Credit Note, the invoiced quantity on flip D of the originating Order will be updated, irrespective of whether you are using the Credit Notes Update Invoiced Quantity option in the Order Settings setting in the Sales Orders module.

To print the Credit Note, click the Printer icon. If you have not approved the Credit Note and if you are not using the No Test Printout option in the Optional Features setting in the System module, the printed Credit Note will be marked as a test print, so that it cannot be confused with the final version of the Credit Note.

When the Credit Note is complete, click the OK check box and save. This signifies that the Credit Note has been approved. Associated transactions in the Nominal Ledger will now be raised and you will no longer be able to modify the Credit Note.

Please click here or a full description of the Invoice/Credit Note screen, and here for details about Credit Notes.

To close the screen and return to the Return, click the close box. You will be asked if you want to save any changes.

Row Menu - Returned Goods

The matrix in the Returned Goods window has its own menu, which contains a function that refers to or affects an individual row in the matrix. This is sometimes known as the "Row Menu".

If you are using Windows or macOS, you can open the Row menu by first clicking in any field in the row in question (i.e. the row to which the function is to be applied), and then right-clicking (Windows) or Ctrl-clicking (macOS) the row number (on the left of the row). A menu will appear, where you can select the function:

On iOS and Android there is no Row menu, so on those platforms you will find the Row menu function on the Tools menu (with 'wrench' icon), together with the Operations menu functions.

Please follow the links below for details about the function on the Row menu:

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The Returned Goods register in Standard ERP:

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Row Menu - Returned Goods - Quality Control

This page describes the 'Quality Control' function on the Row menu in the Returned Goods record window. If you are using iOS or Android, the 'Quality Control' function is on the Tools menu (with 'wrench' icon).

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If a row in a Returned Goods record contains an Item with a Serial Number and a Best Before Date, you may need the Item to undergo quality control tests in order to confirm whether it can be re-sold. The 'Quality Control' function allows you to record the result of this test.

To use this function, first place the insertion point in the Return row containing the Item that has been tested. Then open the Row menu by right-clicking (Windows) or ctrl-clicking (macOS) the row number. When the Row menu opens, select 'Quality Control'. If you are using iOS or Android, select 'Quality Control' from the Tools menu (with 'wrench' icon). A 'Batch Quality Control: New' window will open, allowing you to enter the details of the test. In particular, use the Result field to connect the Batch Quality Control record to a record in the Batch Status setting. After you mark the Batch Quality Control record as OK and save, this Batch Status record will determine whether you will be warned when using the Item/Serial Number combination in an outgoing stock transaction, or whether you will be prevented from using the Item/Serial Number altogether.

Please refer here for more details about the 'Quality Control' function and about alternative methods that you can use to record the result of a quality control test on the Item/Serial Number.

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The Returned Goods register in Standard ERP:

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