Returns

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Process Group/Policy Details

- Stock Return: The Process group includes the policies and procedures necessary for the return of inventory to warehouses, including internal customers, external customers, and vendors.

- This policy is required to standardize the processes for stock returns and vendor returns.

- Departments shall record all stock returns using the transactions noted in the procedures below.

- Departments shall use Stock Return (SN) transactions to return previously issued items back to the originating warehouse. Commodities procured on the Standard Requisition Transaction (RQS) or the over-the-counter (OC) are eligible for returns. The SN transaction allows the original requestor to return previously issued items back to the originating warehouse. Additional return charges can be imposed automatically, but departments have the choices of what is to be charged (if anything). The SN transaction returns the quantity of stock items (that have been issued) back to the warehouse, corrects the increase in expenses to the buyer and decreases the revenue for the seller, and finally applies any additional surcharged for the return as configured by the warehouse.

Commodities procured on the Standard Requisition for External Customers Transaction (SNE) are also eligible for returns. The SNE transaction allows the issuing warehouse to return quantities from an external customer as previously issued items by that warehouse. Additional return charges can be imposed automatically, but departments have the choices of what is to be charged (if anything). The SNE transaction returns the quantity of stock items (that have been issued) back to the warehouse, corrects the increase in expenses to the buyer and decreases the revenue for the seller, and finally applies any additional surcharged for the return as configured by the warehouse.

Departments shall use an Inventory Adjustment (IA) transaction to decrease the quantity on hand when inventory needs to be returned to the vendor. Users will then notify their Cabinet’s procurement staff to initiate a return.

The return of stock items to inventory by the user results in reversing the accounting events that took place at the issuance of these items. When the buyer is an internal customer to the State of Colorado, the issuing warehouse decreases in revenue or an expenditure credit, the inventory account, and cost of goods sold. For the buyer, there is a decrease in expenditure/expense. When the buyer is not an internal party, there is only a warehouse