Xero Manufacturing Settings

The Manufacturing tab of your Xero settings controls the Xero ledger account that receives the extra production costs recorded on manufacturing (production) orders — the values in the Labor / Overhead cost column on the production order. When a manufacturing order’s inventory movements sync to Xero, the value of those extra costs is posted to the account you choose here.

This article explains what the Manufacturing setting does, how to choose its default ledger account, and how to add optional override rules that send specific orders to a different account. After reading it you will be able to configure where manufacturing costs land in Xero and understand exactly which amount is posted and when.

The Labor / Overhead column on the production order — whose value is what posts to the account on this tab — is documented in Manufacturing costs, wastage, unconsumed materials and yield. This article covers only where that amount lands in Xero.

This account sets where the labor and overhead portion of a manufacturing order posts. The stock-on-hand and cost-of-goods-sold value on the same order use the accounts on your Inventory tab. However, all of these amounts travel together as one journal entry, so setting this account to Do Not Sync skips the whole manufacturing entry — see “How and when manufacturing costs sync to Xero” below.

Where to find it

1. Open Integrations and select Xero.
2. On the Xero settings page, open the Manufacturing tab.

The tab has two parts: a default ledger account selector at the top, and an override-rules list below it.

Choosing the default ledger account

At the top of the tab, the Manufacturing header sits next to a ledger selector with the placeholder Select ledger. Choose the Xero account that should normally receive manufacturing costs.

The list groups your Xero accounts by Assets, Revenue, Expenses, Liability, and Equity. At the top is a Default group containing Do Not Sync and Inherit.

• Pick the account where labor and overhead costs should post (commonly an expense or a work-in-progress account — confirm the right one with whoever owns your accounting).
• Choose Do Not Sync if manufacturing costs should not be sent to Xero at all. When this is selected, the manufacturing ledger entry is skipped during sync (see “How and when manufacturing costs sync to Xero” below).

After making your changes, choose Save changes at the bottom of the settings page. While the save is in progress the button reads Saving.

Setting the Manufacturing account to Do Not Sync skips the entire manufacturing ledger entry, not just its cost line. No journal lines are posted for that entry — including its stock-on-hand and cost-of-goods-sold portions — and the entry is reported as skipped.

Adding override rules

Below the default account is an override-rules section, described on screen as Configure override rules for syncing manufacturing data. Use it when certain manufacturing orders should post to a different account than the default. The note beside the Manufacturing header at the top of the tab reads: If a rule matches, its ledger account & tracking override the defaults above.

To add a rule, choose Add rule, then set the matching condition and the action.

A manufacturing rule can match on one of these fields:

For each rule you then set the action — Set ledger account to (the Xero account) and, optionally, Set tracking category to (a Xero tracking category). Rules are evaluated in order; the first matching rule wins, and its account overrides the default.

For manufacturing ledger journals, the Set tracking category to value on a rule is not currently applied to the posted Xero line — only the ledger-account override takes effect. The field is present in the rule builder, but the chosen tracking category does not change the posted manufacturing journal.

Rules are optional. If you add none, every manufacturing order uses the default ledger account you selected above.

How and when manufacturing costs sync to Xero

The Manufacturing setting only takes effect when a manufacturing order’s inventory movements sync to Xero.

• Trigger — Qoblex syncs inventory ledger entries to Xero as manual journals. A manufacturing order produces a manufacturing-type ledger entry; when that entry syncs, its cost is posted to the Manufacturing account.
• Direction — One way, Qoblex to Xero. Nothing about this setting pulls data back from Xero.
• What is posted — A journal line for the manufacturing cost amount on the order, described as MO #<order number> - <product variant> - Manufacturing in Xero (the middle token is the consumed/produced variant’s full name), on the resolved Manufacturing account. A tracking category set on a rule is not applied to this line.
• Gating — If the resolved Manufacturing account is Do Not Sync, the entire manufacturing ledger entry is skipped: no journal lines are posted for it (including its stock-on-hand and cost-of-goods-sold portions), and the entry is reported as skipped.
• Draft vs posted — Qoblex creates the journal in Xero as a draft first. Whether it is then authorized (posted) is controlled by the Sync journal status setting on the Inventory tab, not by this tab.

When a journal syncs, Qoblex records a notification confirming the journal was created, with a link to open it in Xero.

What this setting does not control

This account only decides where the labor and overhead cost portion of a manufacturing order posts. It does not control:

• which components appear on a bill of materials, or which batches or serial numbers are consumed;
• the quantity of finished goods produced, or whether an order can be completed;
• the Stock On Hand account used for inventory value, or the Cost Of Goods Sold account — those are on the Inventory tab;
• whether the journal is posted as draft or authorized — that is the Sync journal status setting on the Inventory tab.

Troubleshooting