Inventory Value/Cost

Hey all, I’m looking for some help determining our inventory value. I understand how to find the overview, but we’re wondering if there’s a way to just see the material costs of our on hand inventory. We had tracked our labor at a rate that was inconsistent with what we’re actually using so we’re trying to just figure out the material costs. So if I’m thinking this through correctly, any parts we would have completed with that labor rate would have the cost of the materials, as well as the cost of the overhead/labor included in the “on the shelf” cost.

Is there a way to run a report on our inventory just based on the material costs? Or a way to remove labor associated with previous work orders?

@jthomas We’ve got a couple of reports that might be useful to you here.

There’s the Cost Comparison found under Sales>Invoices>Cost Comparison, which will break out labor/overhead and materials for all your invoices, and can be filtered for internal or customer orders.

There’s also the BOM Inventory Cost Breakdown found under Parts>Reports>BOM Inventory Cost Breakdown, which will give you extended labor and materials costs for Build to Stock orders.

Hopefully that gets you the information you need to correct the labor issue!

I am looking at the Inventory Overview report. I am trying to reconcile the ‘Inventory Value’ shown on that report with the ‘Inventory’ shown on the Balance Sheet.
Can you please tell me how the ‘Inventory Value’ is calculated?


The inventory value shown in the Inv Value report (i.e. Parts > Reports > Inventory Value) - that is derived from the Inventory Activity log (Parts > Reports > Inventory Activity), which takes a snapshot of every movement of inventory and its related cost impact.

The inventory value shown in the Inventory Overview is calculated using the inventory quantity on hand times the avg cost of the quantity.

The inventory value shown in your Balance Sheet is simply the sum all of the gl splits and sum of the amounts therein; these amounts are generated by ledger postings, which maybe posted to manually or via system generated ledger posts. System generated ledger posts depend on how you have your G/L Account mappings set.

Any discrepancy between those numbers… could be due to any number of possible issues.
It could be a data issue with the inventory details that were migrated from your previous system, it could be a process-related issue, it could be a bad manual post, it could be bad mapping, etc. etc. - to pinpoint root cause on this type of thing usually requires fairly deep forensic accounting analysis.

Alternatively, you could attempt to draw a clean line as of today (or a date in the near future) and reconcile the inventory numbers from here moving forward (and then monitor any deviations between those two values daily/weekly/monthly into the future).

To do this, first note that we strongly recommend the practice of tying your Balance Sheet inventory account to a particular report in Cetec ERP called “List By Bin”. The “List By Bin” report is the gold standard for any inventory valuation; it is always real time, and it is always the bullet proof calculation of the current real-time count and value of your inventory in the moment.

If you want to draw a clean line as of today (real time), you could run List By Bin, get the total, and create a manual ledger entry against your balance sheet inventory account(s) to accommodate any delta, such that the Inventory asset account balance matches the List By Bin data. Then, monitor any deviations between those two values daily/weekly/monthly into the future.

Hope this helps. Thanks!