Although the Xero integration does not enable automatic stock level syncing from Katana to Xero, you can manage this task through manual journal entries.
Does Katana sync stock to Xero automatically?
The Katana–Xero integration allows you to send sales orders as invoices and purchase orders as bills with one click.
However, it does not automatically sync stock levels to Xero.
Instead, you can keep Xero updated by recording manual journal entries periodically based on Katana’s real-time stock data.
Two ways to handle stock in Xero
1. Not tracking stock in Xero
Use Katana exclusively for stock management.
Only record sales and expenses in Xero.
Pros:
Always up-to-date stock in Katana.
No need for duplicate data entry in Xero.
Cons:
Not suitable if local accounting rules require stock tracking in financial statements.
2. Tracking stock in Xero (with COGS accounting)
If your accounting setup requires tracking stock and showing Cost of Goods Sold (COGS) in the income statement, you can create journal entries in Xero periodically (e.g., monthly, quarterly).
Here’s how:
Steps for recording stock movements in Xero
1. Add purchased materials to stock
In Xero: Run the Profit and Loss report for the period. Find the account related to purchased materials (e.g., “Purchases (materials)”).
Create a journal entry to increase stock and decrease material expenses by this amount.
2. Convert materials into finished products
(skip if you only use one stock account in Xero)
In Katana: Go to Make screen → Schedule tab → Done table and filter manufacturing orders completed in the period. Note the Materials cost.
In Xero: Create a journal entry to decrease material stock and increase finished goods stock by this amount.
3. Add operations cost (e.g., salaries) to finished goods
In Katana: From the same filtered done manufacturing orders, note the operations cost.
In Xero: Create a journal entry to decrease salary expense and increase finished goods stock by this amount.
4. Record Cost of Goods Sold (COGS)
In Katana: Go to Sell screen → Sales orders tab → Done table and filter by Picked date. Find the COGS/COSS amount for orders completed in the period.
In Xero: Create a journal entry to decrease finished goods stock and increase Cost of Sales (COGS).
5. Adjust for stock changes in Katana
In Katana: Go to Stock screen → Stock adjustments tab and filter adjustments by date.
In Xero: Create a journal entry to reflect the adjustment (e.g., write-offs for damaged items).
If you use subassemblies
If you track subassemblies separately in Xero:
Convert materials into subassemblies
In Katana: Filter done manufacturing orders for subassemblies. Note the materials cost.
In Xero: Create a journal entry to decrease material stock and increase subassembly stock.
Add operations cost to subassemblies
In Katana: Note the operations cost for completed subassembly orders.
In Xero: Create a journal entry to decrease salary expense and increase subassembly stock.
Convert subassemblies + materials into finished goods
In Katana: Calculate the total Materials cost for finished goods, subtracting costs already assigned to subassemblies.
In Xero: Create journal entries to convert both materials and subassemblies into finished goods stock.
Summary
If local rules allow, it’s simplest to only track stock in Katana.
If you need to track stock in Xero, follow the periodic journal entry process.
Use Katana as your real-time stock source and update Xero periodically for accounting compliance.
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