Inventory in Cash Basis P&L and Summary Report

For a variety of reasons which I cannot change at the moment, I use cash basis accounting. I have a question about the inventory tracking in the Profit & Loss report (and likewise the summary page).

It appears that, with cash basis, the system does not adjust “Inventory on Hand” or “Cost of Goods Sold” until after I receive payment for an invoice. For example:

  1. Enter sales invoice of 10 units to Customer A. Clicking “Inventory on hand” shows nothing.
  2. Enter delivery note of 10 units to Customer A. Clicking “Inventory on hand” shows offsetting +10 and -10 entries. This doesn’t seem right, particularly with cash basis, as the inventory has certainly left my possession.
  3. Receive payment for 10 units from Customer A. Now clicking “Inventory on hand” finally shows the -10 entry, and the corresponding cost is moved into COGS. But this not until the date the payment is received.

Is this a problem with the reports? At the least, it doesn’t align with any cash basis accounting I have done before.

No, everything that you have described sounds normal. If you like, under Summary tab Set Period you can toggle between cash basis and accrual basis to see the difference in workings.

Toggling only changes reporting style, it doesn’t affect data.