NetSuite Flow Process Guide

This section documents end-to-end transaction flows in NetSuite, showing how records connect, when GL entries are created, and when inventory movements occur.

---

Why Flow Process Matters

Understanding transaction flows helps you:

• Debug issues - Know which record affects what
• Plan customizations - Write scripts at the right trigger point
• Audit trails - Trace transactions from source to GL
• Training - Teach users the "why" behind each step

---

Inventory & GL Flow (Big Picture)

See how all transactions interconnect:

Map	Description
Overview	Big picture view of all flows
Inventory Flow Map	All physical inventory movements in one diagram
GL Flow Map	All financial/accounting entries in one diagram

---

Available Flows

Flow	Description
Sales Flow	All sales paths with or without Sales Order
Purchase Flow	All purchase paths with or without Purchase Order
Manufacturing Flow	Work Orders, Assembly Builds, Outsourcing
Inventory Flow	Adjustments, Transfers, Physical Counts
Bank Flow	Deposits, Payments, Reconciliation
Employee Flow	Expense Reports, Reimbursements
Financial Flow	Journal Entries, Period End, Intercompany
Costing Flow	Average, Standard, FIFO/LIFO, Lot/Serial costing

---

Quick Navigation: Sales Flow

Page	Description
Overview	Master flow diagram, accounting basics
Standard Path	SO → Fulfillment → Invoice → Payment
Direct Paths	Invoice Direct, Cash Sale, Standalone transactions
Returns & Credits	RMA, Credit Memo, Customer Refund

Quick Navigation: Purchase Flow

Page	Description
Overview	Master flow diagram, accounting basics
Standard Path	PO → Item Receipt → Vendor Bill → Payment
Direct Paths	Bill Direct, Standalone Bill, Drop Ship
Returns to Vendor	VRA, Vendor Credit, Vendor Refund

---

Flow Documentation Format

Each flow document includes:

STANDARD FLOW DOCUMENTATION FORMAT
─────────────────────────────────────────────────────────────────

1. OVERVIEW DIAGRAM
   - Visual flow of records
   - Decision points

2. CHRONOLOGICAL STEPS
   - What happens at each stage
   - Which records are created

3. GL IMPACT
   - When journal entries post
   - Which accounts are affected

4. INVENTORY IMPACT
   - When quantity changes
   - Committed vs Available vs On Hand

5. VARIATIONS
   - Different paths (e.g., Invoice Direct)
   - Special scenarios

6. RELATED RECORDS
   - All connected record types
   - How they link together

---

Quick Reference: GL vs Inventory Timing

Sales Transactions

Transaction	GL Impact?	Inventory Impact?
Sales Order	No	Commits qty (reduces Available)
Item Fulfillment	No (typically)	Reduces On Hand
Invoice	Yes	No (already fulfilled)
Invoice (Direct)	Yes	Reduces On Hand
Cash Sale	Yes	Reduces On Hand

Purchase Transactions

Transaction	GL Impact?	Inventory Impact?
Purchase Order	No	On Order qty only
Item Receipt	Yes	Increases On Hand
Vendor Bill (from IR)	Yes	No (already received)
Vendor Bill (Direct)	Yes	Increases On Hand
Vendor Payment	Yes	No

---

Memory Aids: Easy Rules to Remember

The Golden Rules

THREE SIMPLE RULES
─────────────────────────────────────────────────────────────────

RULE 1: GL posts when MONEY is involved
        Invoice (A/R created) → GL ✓
        Payment (Cash moves) → GL ✓
        Sales Order (just a promise) → No GL ✗

RULE 2: INVENTORY moves when PHYSICAL GOODS move
        Fulfillment (ship goods) → Inventory ✓
        Item Receipt (receive goods) → Inventory ✓
        Bill (just paperwork) → No Inventory ✗

RULE 3: ORDERS are just PROMISES
        Sales Order = promise to sell → No GL, just commits
        Purchase Order = promise to buy → No GL, just on order

Visual Matrix: What Happens When?

SALES SIDE - WHAT TRIGGERS WHAT?
─────────────────────────────────────────────────────────────────

                    │ GL │ Inventory │ A/R │ Cash │
                    │Posts│  Moves   │ Created │ Moves │
────────────────────┼────┼──────────┼─────────┼───────┤
Sales Order         │ ✗  │ Commits  │   ✗     │   ✗   │
Item Fulfillment    │ ✗  │ ↓ Out    │   ✗     │   ✗   │
Invoice             │ ✓  │ ✗        │   ✓     │   ✗   │
Invoice Direct      │ ✓  │ ↓ Out    │   ✓     │   ✗   │
Cash Sale           │ ✓  │ ↓ Out    │   ✗     │   ✓   │
Customer Payment    │ ✓  │ ✗        │ Cleared │   ✓   │
Credit Memo         │ ✓  │ ↑ In*    │ Reduced │   ✗   │
Customer Refund     │ ✓  │ ✗        │ Cleared │   ↓   │

* If goods returned

PURCHASE SIDE - WHAT TRIGGERS WHAT?
─────────────────────────────────────────────────────────────────

                    │ GL │ Inventory │ A/P │ Cash │
                    │Posts│  Moves   │ Created │ Moves │
────────────────────┼────┼──────────┼─────────┼───────┤
Purchase Order      │ ✗  │ On Order │   ✗     │   ✗   │
Item Receipt        │ ✓  │ ↑ In     │  IRNB   │   ✗   │
Vendor Bill (w/IR)  │ ✓  │ ✗        │   ✓     │   ✗   │
Vendor Bill Direct  │ ✓  │ ↑ In     │   ✓     │   ✗   │
Vendor Payment      │ ✓  │ ✗        │ Cleared │   ↓   │
Vendor Credit       │ ✓  │ ↓ Out*   │ Reduced │   ✗   │
Vendor Refund       │ ✓  │ ✗        │ Cleared │   ↑   │

* If goods returned

Memory Patterns

Pattern	Rule	Examples
"Order = Promise"	Orders don't post GL	SO, PO
"Bill = Money Owed"	Bills create payables	Invoice → A/R, Vendor Bill → A/P
"Physical = Inventory"	Physical movement = inventory change	Fulfillment, Receipt
"Paper = GL"	Financial documents = GL entries	Invoice, Bill, Payment

Debit/Credit Cheat Sheet

WHEN DO I DEBIT vs CREDIT?
─────────────────────────────────────────────────────────────────

ASSETS (Cash, Inventory, A/R):
  ↑ Increase = DEBIT    │  "Got cash? Debit it!"
  ↓ Decrease = CREDIT   │  "Spent cash? Credit it!"

LIABILITIES (A/P, Loans):
  ↑ Increase = CREDIT   │  "Owe more? Credit it!"
  ↓ Decrease = DEBIT    │  "Paid debt? Debit it!"

REVENUE (Sales):
  ↑ Increase = CREDIT   │  "Made money? Credit revenue!"

EXPENSES (COGS, Rent):
  ↑ Increase = DEBIT    │  "Spent money? Debit expense!"

Quick Decision Tree

IS THERE A GL ENTRY?
─────────────────────────────────────────────────────────────────

Does this transaction create a financial obligation?
│
├── YES (Invoice, Bill, Payment) → GL POSTS ✓
│
└── NO (Order, Fulfillment, Receipt*) → NO GL ✗

* Receipt posts GL for inventory asset + IRNB

DOES INVENTORY CHANGE?
─────────────────────────────────────────────────────────────────

Are physical goods moving in or out?
│
├── SHIPPING OUT (Fulfillment, Return to Vendor)
│   → Inventory DECREASES (On Hand ↓)
│
├── RECEIVING IN (Item Receipt, Customer Return)
│   → Inventory INCREASES (On Hand ↑)
│
└── PAPER ONLY (Order, Bill, Payment)
    → NO inventory change

The "Money Flow" vs "Goods Flow" Concept

TWO SEPARATE FLOWS
─────────────────────────────────────────────────────────────────

SALES:
  Goods Flow:   SO → Fulfillment ──────────────→ Customer
  Money Flow:   ─────── Invoice → Payment ────→ Your Bank
                        ↑
                        GL posts here (when money flows)

PURCHASE:
  Goods Flow:   Vendor ──────────────→ Receipt → Warehouse
  Money Flow:   Your Bank ← Payment ← Bill ─────
                                       ↑
                                       GL posts here

---

Getting Started

Start with the Sales Flow - the most common transaction flow in NetSuite.