Need help understanding what happens when a sales order is closed in NetSuite, or when they might use this feature? This article is for you! Here, I will explain the effects of the Close Order option in NetSuite!
Why Close a Sales Order in NetSuite
Closing a sales order allows you to indicate that you do not intend to fulfill or bill the order while still allowing you to keep a record of the order in your system.
NetSuite Best Practice: It is a best practice to avoid deleting transactions.
You can close a sales order at any point up until you receive payment for it.
In NetSuite, the Close Order button is at the top of a sales order open in View mode. It appears for Pending Fulfillment statuses and later, but disappears once the order is fully billed. If you are invoicing the order, this means that the invoice is paid in full.
You can also close individual order lines that indicate that you will not fulfill those lines but will still fulfill the remainder of the order. You can close a sales order line by checking the Closed checkbox on the item line.
Effects of Closing a Sales Order in NetSuite
Closed orders will not appear in lists to be fulfilled, billed, or received and will cause any committed inventory to decommit from the line/order in NetSuite. This way, your employees will not see the order anywhere in NetSuite and will not accidentally create additional linked transactions.
Linked Transactions in NetSuite
Item Fulfillments and Inventory Reports
When closing a sales order, be sure to check for linked item fulfillments in the Picked or Packed status. If you close an order and leave the linked picked/packed fulfillments, those fulfillments continue to take up inventory commitment and prevent you from reallocating that inventory.
Additionally, closed sales orders do not show on any native inventory reports, so it can be hard to identify the transactions tying up inventory if they are linked to a closed sales order. It may be useful to have a saved search that identifies any item fulfillments in the picked/packed status that are tied to closed sales orders.
If there are shipped fulfillments linked to the order, you should bill them before closing the order.
GL Impact
Closing sales orders in NetSuite does not affect your GL as sales orders do not have a posting GL impact.
Impact on Purchase Orders
Closing a sales order in NetSuite does not automatically close any linked Purchase order records. You will need to review those purchase orders and decide whether they should be closed as well or received as planned; this decision will depend on your particular business.
Closing Individual Lines on a NetSuite Sales Order
If closing a single sales order line, that line will not be included in any future linked transactions. If you close all lines on a sales order, the order’s status will change to Closed. Note that a closed sales order line’s amount will still be included in the sales order total amount, but will not be included in the invoice or cash sale records if created after the line’s closing. You may want to change the amount on closed lines to $0 to avoid confusion.
If closing a sales order line that has already been included on a fulfillment record, you will also need to update the item fulfillment so that the inventory does not remain tied up.
Examples for Closing a Sales Order
Here are a couple of situations in which you might close a sales order:
- Poor warehouse management results in the discovery of a sales order entered over a year ago. You never received payment for this order and many periods have been closed since it was created. You do not intend to fulfill the order, so rather than deleting it, you mark it as Closed and add a note in the memo explaining the situation.
- A customer submits an order through your website. You have partially packed the order when the customer calls back and asks you to cancel it. You delete the packed fulfillment and close the sales order.
- A customer places an order with an item that is on back order. You alert the customer that it will take some time before you can ship them the item, so they ask you to remove the item from their order. You edit the sales order and close that item line only. You may also want to set that line’s amount to $0 so that it is removed from the sales order total - closing the line does not automatically do this.
Re-opening a Closed Sales Order in NetSuite
You can reopen unfulfilled closed sales orders in NetSuite by editing the record and unchecking the Closed checkbox on any lines you wish to reopen. Upon saving the sales order, the status changes back to Pending Fulfillment.
Author: Benjamin Galvin
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