crediting an inventory invoice when the inventory is not being returned best preactice

AI generated answer (using internal Slack threads):

****** Disclaimer: This response was generated by an artificial intelligence assistant based on previous conversations from multiple Slack channels, and may contain inaccuracies or mistakes. ****** When crediting an inventory invoice when the inventory is not being returned, the best practice would be to follow through with the standard bill credit. However, since the inventory is not being returned, this will automatically add the inventory back into your system. To counteract this, you should perform an inventory adjustment to remove the inventory. For non-inventory items that are received but not billed, you would need to manually account for the cost passing through an RNI-type account using journal entries. If the cost is material and the items are purchased well in advance of consumption, it would be recommended to use an inventory item. If the purchased item is immediately consumed or is a depreciable purchase, then there is no need to use an inventory item. In this case, the non-inventory expense account would simply reflect the expense or asset account and would be impacted when billed. As for allowing inventory to go negative for invoicing procedures, this is generally strongly discouraged as it can cause numerous accounting issues. Remember, your approach ultimately depends on what you're buying, materiality, and rate of consumption to determine the best method for item creation.

@Lee Brookes, we generate a return authorization from the invoice and then create a credit memo from the return authorization. After the invoice is credited, we close the RA if we do not expect to receive the inventory back.