What two transactions cause a Bill Variance journal entry to be posted?

When the accounting preference “Post Vendor Bill Variances” is enabled, NetSuite automatically creates a Bill Variance (Purchase-Price-Variance) journal entry at two moments:

1. Item Receipt – inventory is capitalized at standard cost; the variance between standard cost and PO rate is posted to the PPV-Clearing account.

2. Vendor Bill – NetSuite compares the vendor-bill amount to the PO/item-receipt amount; any remaining variance is posted from PPV-Clearing to the final PPV account.

No variance is generated on Bill Payment, Purchase Orders, or Requisitions because those events do not affect inventory valuation or expense recognition.

B. Purchase order – non-posting transaction; does not hit the general ledger, so no variance is recorded.

C. Bill payment – only settles A/P with Cash; variances were already posted at vendor-bill stage.

D. Purchase requisition – planning document; no GL impact, therefore no variance posting.

1. NetSuite Help Center

“Accounting Preferences > Post Vendor Bill Variances

” para. 1–3 (accessed 2024-08-21).

2. NetSuite Help Center

“Standard Costing > Purchase Price Variance Workflow

” sections “Item Receipt Posting” and “Vendor Bill Posting

” pp. 1-2 (2024 release notes).

3. NetSuite Help Center

“Bill Variance Clearing Accounts

” para. 2 (2024.1).