Balance sheet syncing

Balance sheet syncing is currently only available with the Xero and Quickbooks Online integrations.

Breww can create journal entries in your accountancy software to keep your balance sheet and COGS up-to-date as you move costs through Breww from purchase to production to sale.

Breww-controlled accounts

The following is important. Please ensure you read and understand the following section on Breww-controlled accounts before enabling balance sheet syncing.

To ensure that the balance sheet syncing between Breww and your accountancy software is as robust as possible, Breww will regularly check for differences in the value of any stock item, WIP, or product finished goods account. These are referred to as Breww-controlled accounts.

If the value in your accountancy software is ever different from that in Breww, Breww will assume something was missed and make a correcting entry. This means that if you ever make a manual change to these accounts directly in your accountancy software, it will automatically be adjusted out by Breww using your chosen Stock adjustments account.

Because of this, we recommend setting up brand-new accounts for these areas. So, rather than use your existing Raw materials, WIP or Finished goods accounts, create new ones to be used only by the Breww integration, such as:

Breww: Raw materials
Breww: WIP
Breww: Finished goods

This way, it's clear that Breww should only use these accounts.

Enabling balance sheet syncing

Before enabling balance sheet syncing, you'll need to import into Breww the accounts to which you want these costs synced. You will need an account for each of the following sections.

Required accounts

Breww area	Required type	Breww controlled	Description
Stock items	Asset	Yes	These will be the accounts that hold the value of the landed cost of all stock items in your Breww account, added either through inventory receipts or adjustments.
Inventory receipt additional costs	Asset, Expense	No	These accounts will hold the value of additional costs on an inventory receipt. After uploading the inventory receipt, these will be moved to the receipt's stock item accounts.
WIP	Asset	Yes	This will be where the value of all in-progress batches is held. This can be overridden per drink type.
WIP losses	Expense	No	Any batches completed without being packaged will have their costs allocated here. This can be overridden per drink type.
Stock adjustments	Expense	No	Any adjustments to the value of in-stock stock items or finished goods will be made into this account. This can be overridden per drink type.
Batch other costs	Asset, Expense, Liability	No	These will be the accounts that are drawn from when utility/other costs are added to a batch. They can be set per-cost type.
Cleaning & maintenance costs	Expense	No	Any stock items used in cleaning & maintenance records will have their cost allocated to this account.
Finished goods	Asset	Yes	These will be the accounts that hold the value of the value of all products (finished goods) in your Breww account. This can be set on a per-product or per-drink-type basis.
Cost of goods sold	Expense	No	These will be the accounts to which the cost of any dispatched products will be moved. This can be set on a per-product or per-drink-type basis.
Accrued liabilities	Liability	No	This will be used when an inventory receipt is 'Added to stock' but hasn't yet been 'Invoiced by supplier'. The value added to stock will be temporarily held in this account until the receipt is invoiced, at which point it is reversed.
Setup offsetting account	Asset	No	After you enable balance sheet syncing, Breww will update the balances of your chosen accounts in your accountancy software to match their current value in Breww. All changes are moved to this account, allowing you to reconcile the differences to their correct accounts. We recommend setting up a brand-new account called "Breww: Setup offsetting account" for this purpose.

Once you have created and imported the required accounts and are ready to enable balance sheet syncing, go to your accountancy integration dashboard in Integrations -> Accountancy -> Actions -> Configuration. From there, click the Enable button on the Balance sheet syncing row in your Data syncing section. This will take you through the process of selecting the accounts you would like to use and enable balance sheet syncing.

The initial offsetting journal entry

When you complete the balance sheet syncing setup wizard and enable syncing, Breww will immediately create a single journal entry in your accountancy software. This journal entry brings the balances of all your Breww-controlled accounts in line with the current values in Breww.

What the journal entry contains

The journal entry is created with the reference "Breww: Balance discrepancy adjustments". For each Breww-controlled account (stock items, WIP and finished goods), Breww compares the current balance in your accountancy software against the current value in Breww. If there is a difference, the journal entry will contain two lines for that account:

A line that adjusts the Breww-controlled account to match the value in Breww.
A corresponding line that moves the difference to your chosen Setup offsetting account.

For example, if your "Breww: Finished goods" account currently has a balance of £0 in your accountancy software, but the value of finished goods in Breww is £5,000, the journal entry will increase the finished goods account by £5,000 and decrease the setup offsetting account by the same amount.

If a Breww-controlled account already has the correct balance (i.e. it matches the value in Breww), no lines will be created for that account.

Why the setup offsetting account is needed

Before Breww begins syncing, the balances in your accountancy software and the values in Breww are likely to be different. These differences could exist because costs were previously tracked manually, in a different system, or simply because these are brand-new accounts with a zero balance.

Rather than ignoring these differences, Breww moves them all into a single setup offsetting account. This gives you a clear, auditable record of the initial adjustments that were made when syncing was turned on.

Reconciling the setup offsetting account

After Breww has created the initial journal entry, you should review the balance on your setup offsetting account. This balance represents the total of all the initial differences between your accountancy software and Breww at the point syncing was enabled.

You can then reconcile this account in your accountancy software by creating journal entries to move the amounts to the correct accounts. For example, if the difference was because your existing raw materials account already held the correct value before Breww took over, you might journal the amount from the setup offsetting account back to your original raw materials account.

Once fully reconciled, the setup offsetting account should have a zero balance, and it will not be used again by Breww. All future balance adjustments are handled through the ongoing discrepancy checking process using the Stock adjustments account.

Drink-type-level account overrides

If you produce multiple types of drink (e.g. Beer and Spirits), you can assign different balance sheet accounts to each drink type. This allows you to track WIP, finished goods, COGS and other costs separately for each type of drink you produce, giving you much more detailed reporting in your accountancy software.

The following accounts can be set per drink type:

WIP account -- used for in-progress batch costs for batches of this drink type
WIP losses account -- used when batches of this drink type are completed without packaging
Finished goods account -- used for packaged products of this drink type
Cost of goods sold account -- used when products of this drink type are dispatched
Stock adjustment account -- used for any balance discrepancy adjustments for this drink type
Sales account -- used for invoice line items for products of this drink type

To set these accounts, go to your accountancy integration's Accounts & tracking page and select the Drink types tab. This tab is visible when you have more than one drink type configured.

When a drink type does not have a specific account set, Breww will use the default account selected during the balance sheet syncing setup. The full resolution order is:

Account set directly on the product (for finished goods and COGS)
Account set on the product's drink type
The default account

For WIP, WIP losses, and stock adjustment accounts, Breww resolves the account based on the drink type of the batch's drink. If no drink-type-specific account is set, the default is used.

If you have been using a single default WIP or finished goods account and want to start separating by drink type, simply set the new accounts on the Drink types tab. Breww's regular discrepancy checking will automatically adjust the balances in your accountancy software to reflect the new account assignments.

How does it work?

Breww will create a journal entry in your accountancy software whenever you make a change in Breww that moves costs from one account to another.

Inventory receipts

When an inventory receipt is marked as "Added to stock", Breww will post an entry debiting the landed cost of the stock items into their accounts and crediting your "Accrued liabilities" account. The associated supplier invoice reverses this "Accrued liabilities" entry when it becomes finalised, but in the meantime, the "Goods received not invoiced" are correctly represented on your balance sheet.

Supplier invoices

When a supplier invoice is finalised, Breww will upload it as a bill or supplier invoice in your accountancy software. This will credit your chosen stock item accounts. If any additional costs have been added to the supplier invoice, their cost will be moved from their account to stock item accounts so that the full landed cost of the stock items is recognised.

Breww will also post an entry crediting the landed cost of the stock items into their accounts and debiting your "Accrued liabilities" account. If the goods have already been received, this will have the effect of reversing the "Goods received not invoiced" journal entry posted by the inventory receipt. However, if you are invoiced before receiving the goods, this will mean that the "Goods invoiced not received" values are represented correctly on your balance sheet.

Product assembly/disassembly

If the accounts for the two products are different, a journal entry will be made, moving the product's value between the accounts. If any stock items are used or returned to stock during the assembly or disassembly, the cost of the stock item will be moved between its account and the relevant product's account.

Adding stock to a batch

When adding a stock item to a batch, a journal entry will be made moving the cost from the stock item's account to the batch's WIP account. If a drink-type-specific WIP account has been set for the batch's drink type, that account will be used; otherwise, the default WIP account is used.

Adding a utility/other cost to a batch

When adding a utility/other cost to a batch, either automatically or manually, a journal entry will be made, moving the cost from the utility costs account to the batch's WIP account.

Packaging a batch

When you package anything from a batch, a journal entry will be made moving the cost from the batch's WIP account to that product's finished goods account. If a drink-type-specific finished goods account has been set, it will be used for products that do not have their own account.

Dispatching an order

When dispatching an order, Breww will create a journal entry moving the value of the dispatched products from their finished goods accounts to their COGS accounts. The value of any stock item products will be moved directly from their stock item accounts to the COGS sold account.

Stock adjustments

Any stock adjustments, either made manually or through a stock take and made either to products or stock items, will create a journal entry adjusting the value of the relevant accounts to or from the appropriate stock adjustments account. If a drink-type-specific stock adjustment account has been set, it will be used for adjustments relating to that drink type. This includes making changes to the price per item of existing stock item stock.

Cleaning & maintenance records

When a stock item is used in a cleaning & maintenance (C&M) record, Breww will create a journal entry moving the cost of the stock item from its stock item account to your cleaning & maintenance cost account. This ensures that the cost of consumables such as cleaning chemicals is correctly recognised as an expense.

If a stock item usage is later removed from a C&M record, Breww will reverse the cost by creating an adjustment entry that moves the value back from the cleaning & maintenance cost account to the stock item account.

If the original journal entries fall within a locked period in your accountancy software, Breww will create a new adjustment entry dated outside the locked period instead of modifying the original entries.

Completing a batch

If nothing has been packaged from the batch, completing it will move its value into the WIP losses account for the batch's drink type. Otherwise, the cost of the batch will have already been transferred to its packaged products.

Updating costs on a batch or invoice

If you update the costs of a batch at any time, for example, by updating the ingredients or quantity of finished goods, Breww will attempt to update the existing journal entries it already created for that batch, and if the batch has been dispatched, the journal entries for any affected invoices. This helps keep the number of journal entries created by Breww to a minimum.

However, if the journal entries fall within a locked period in your accountancy software, Breww will instead create a new "Adjustment" entry to account for the change.

Checking for discrepancies

As part of making this feature as robust as possible, Breww will regularly check for differences in the value of any stock item account, WIP account, or product finished goods account. If the value in your accountancy software is different from that in Breww, Breww will assume something was missed and make a correcting entry, moving the difference to/from the appropriate stock adjustments account. When a drink-type-specific stock adjustment account has been configured, Breww will use it for discrepancies on accounts that belong exclusively to that drink type. This ensures that if any journal entry is ever missed, your balance sheet is always kept corrected and up-to-date.

How often will Breww sync these balance sheet changes?

The majority of entries made by Breww will be synced to your accountancy software three times a day. However, entries for your invoices and inventory receipts will be created at the point the invoice or inventory receipt is uploaded to keep your COGS up-to-date in real-time.

Why does the valuation in my accountancy software not match my stock valuation in Breww?

There are two potential reasons your stock valuation in Breww might not match the valuation you see in your accountancy software on the same date.

Stock valuation wastage setting

Breww allows you to choose how you'd like wastage to be accounted for when performing its stock valuations, which is further explained here: Stock value & wastage.

When syncing values to the balance sheet in your accountancy software, Breww syncs the exact cost to produce from Raw materials -> WIP -> Finished goods, equivalent to the "Ignore wastage" stock valuation setting.

If you would like your valuation in Breww to match the value synced to your accountancy software's balance sheet, you will need to update your "Wastage option" to match by setting it to "Ignore wastage".

Cost changes made after the stock valuation is run

Changes to costs made after Breww's stock valuation has been run do not update the valuation - they are fixed at the point they are created. For example, changes to Utility/other costs on a batch made after the stock valuation will not update the costs of anything in your stock valuation. However, Breww will retrospectively update the journal entries made in your accountancy software if they are not within a locked period.

This means that if you compare a stock valuation in Breww against the value of your balance sheet on the same date, but much later after changes have potentially been made to the period in Breww, you may find that the valuations differ.