Understanding and Resolving Net Total Variations in Purchase Orders

When managing purchase orders in ERP systems, understanding how taxes like GST (Goods and Services Tax) impact the net total is crucial. Users often encounter an issue where the 'Net Total' field on a Purchase Order page inconsistently includes GST — sometimes it reflects the base amount only, other times it includes the tax. This inconsistency can lead to confusion and errors in financial documentation and reporting.

The variation in how GST is applied to the net total of a purchase order often stems from settings within the Purchase Order itself:

In the Purchase Header, particularly under the Invoicing section, there’s an option "Prices include GST". This checkbox plays a critical role:

• Checked: The system assumes that the prices entered include GST. Therefore, the net total displayed will reflect this inclusion.
• Unchecked: Prices entered are considered exclusive of GST, and the net total will show the base amount only.

The way a vendor is set up in the system can also influence how taxes are calculated:

• Tax Liable Setting: If a vendor is marked as tax liable, any transactions with them will need to account for GST.
• Sales Order Settings: Similar to purchase orders, the tax settings on related sales orders need to be consistent to ensure accurate tax calculation.

Ensuring that tax-related fields on sales lines are filled in correctly is crucial. Any discrepancies here can lead to incorrect tax calculations and therefore variations in the net total.