Common GRNI Mistakes and How to Avoid Them

GRNI (Goods Received Not Invoiced) plays a small but critical role in inventory control and accounting. Small mistakes in GRNI handling cause outsized headaches—misstated inventory, unexpected supplier disputes, or painful month-end adjustments. Below is a beginner-friendly guide to common GRNI mistakes and practical ways to avoid them.

Mistake 1: Failing to record receipts promptly

When warehouses delay recording a receipt, GRNI isn’t created and inventory costs aren’t accrued. That can understate liabilities and give a false picture of available stock. The fix is basic: require same-day or next-day recording of all receipts. Use barcode scanning and simple receiving checklists to speed documentation.

Mistake 2: Duplicate GRNI entries

Duplicate recording can happen when multiple teams process the same GRN or when manual entries are made without visibility of prior entries. Duplicates inflate inventory and accruals. Avoid this by centralizing receipt entry (ideally in the WMS), implementing unique receipt IDs, and reconciling GRNI control accounts against receiving logs regularly.

Mistake 3: Poor matching due to missing PO numbers

Invoices without PO references or mismatched PO numbers are hard to match and keep GRNI open longer. Make PO numbers mandatory on supplier invoices and train suppliers on your invoicing requirements. On your side, maintain a master PO register that’s easy for warehouse staff to reference during receiving.

Mistake 4: Not adjusting for damaged or short shipments

Sometimes goods arrive damaged, or quantities are short. If the GRNI accrual reflects the original PO quantity rather than the accepted quantity, you end up overstating inventory and liabilities. Ensure your receiving process includes immediate discrepancy recording, and route disputes to purchasing quickly so accruals can be adjusted.

Mistake 5: Relying entirely on manual processes

Manual posting and reconciliation are slow and error-prone, especially for growing businesses. A partially integrated WMS/ERP increases human steps and the chance of error. Invest in simple automation—scanning, EDI, or even batch imports—to reduce manual data entry and speed reconciliation.

Mistake 6: Poor aging controls

GRNI items that linger for months often signal unresolved disputes or missing documentation. Without monitoring, accruals can pile up and distort financial ratios. Set up aging reports that highlight receipts older than your target (e.g., 30/60/90 days) and assign owners to clear them.

Mistake 7: Weak three-way match policies

A weak or inconsistent three-way match process (PO, GRN, Invoice) leads to unapproved invoices being paid or accruals not being cleared. Define clear tolerances for price and quantity variances, and implement an approval path for exceptions. Even a small threshold (e.g., 5%) with documented approvals reduces ad hoc adjustments.

Mistake 8: Lack of cross-functional communication

GRNI touches purchasing, warehouse, and AP. If teams work in silos, issues slip through gaps—receiving notes don’t reach AP or purchasing doesn’t follow up on disputed invoices. Set a clear escalation matrix and regular touchpoints (e.g., weekly exception review meetings) so everyone stays aligned.

Mistake 9: Incorrect valuation methods

Inventory valuation must match accounting policy (FIFO, weighted average, etc.). If GRNI accrual values are calculated inconsistently—using differing unit prices or currencies—your inventory and COGS can be wrong. Standardize valuation rules in the ERP and ensure receiving records include the correct unit costs or reference PO pricing.

Mistake 10: Ignoring audit trails

Without an audit trail showing who recorded receipts and who approved invoices, investigations become difficult. Ensure your systems capture user IDs, timestamps, and change logs. These records speed dispute resolution and support external audits.

How to avoid these mistakes—practical checklist

1. Enforce same-day or next-day receipt recording in the WMS.
2. Require PO numbers on all invoices and make supplier communication clear and consistent.
3. Automate data transfer between WMS and ERP where possible; use unique receipt IDs.
4. Implement three-way matching with defined variance tolerances and an approval workflow for exceptions.
5. Run regular GRNI reconciliations and aging reports; assign owners for open items.
6. Document processes, provide training, and maintain audit trails with timestamps and user information.

Example corrective action

Suppose month-end reveals $25,000 in GRNI older than 90 days. Instead of a single write-off, follow a corrective path: review each item to identify missing invoices, contact suppliers for copies, validate receipts physically, and either clear accruals with invoices or document reasons for adjusting accruals (e.g., returned goods or credits). Keep a log of actions so recurring supplier issues can be escalated to purchasing for long-term fixes.

In friendly terms: GRNI mistakes usually come from small process gaps—late inputs, missing PO numbers, or poor communication. Fixing the basics (timely recording, mandatory PO references, automation, and regular reconciliation) prevents most problems. Think of GRNI as a small control with big benefits: accuracy, predictability, and fewer surprises at month-end.