diff --git a/stock/doctype/stock_reconciliation/stock_reconciliation.py b/stock/doctype/stock_reconciliation/stock_reconciliation.py
index 021a833..3e3ad20 100644
--- a/stock/doctype/stock_reconciliation/stock_reconciliation.py
+++ b/stock/doctype/stock_reconciliation/stock_reconciliation.py
@@ -20,12 +20,14 @@
 from webnotes import msgprint, _
 from webnotes.utils import cstr, flt
 from webnotes.model.controller import DocListController
+from stock.stock_ledger import update_entries_after
 
 class DocType(DocListController):
 	def validate(self):
 		self.validate_data()
 		
 	def on_submit(self):
+		print "in stock reco"
 		self.insert_stock_ledger_entries()
 		
 	def on_cancel(self):
@@ -110,7 +112,6 @@
 		data = json.loads(self.doc.reconciliation_json)
 		for row_num, row in enumerate(data[1:]):
 			row = webnotes._dict(zip(row_template, row))
-			
 			previous_sle = get_previous_sle({
 				"item_code": row.item_code,
 				"warehouse": row.warehouse,
@@ -118,13 +119,20 @@
 				"posting_time": self.doc.posting_time
 			})
 			
+					
+			change_in_qty = row.qty != "" and \
+				(flt(row.qty) != flt(previous_sle.get("qty_after_transaction")))
+		
+			change_in_rate = row.valuation_rate != "" and \
+				(flt(row.valuation_rate) != flt(previous_sle.get("valuation_rate")))
+			
 			if get_valuation_method(row.item_code) == "Moving Average":
-				self.sle_for_moving_avg(row, previous_sle)
+				self.sle_for_moving_avg(row, previous_sle, change_in_qty, change_in_rate)
 					
 			else:
-				self.sle_for_fifo(row, previous_sle)
+				self.sle_for_fifo(row, previous_sle, change_in_qty, change_in_rate)
 					
-	def sle_for_moving_avg(self, row, previous_sle):
+	def sle_for_moving_avg(self, row, previous_sle, change_in_qty, change_in_rate):
 		"""Insert Stock Ledger Entries for Moving Average valuation"""
 		def _get_incoming_rate(qty, valuation_rate, previous_qty, previous_valuation_rate):
 			if previous_valuation_rate == 0:
@@ -132,12 +140,6 @@
 			else:
 				return (qty * valuation_rate - previous_qty * previous_valuation_rate) \
 					/ flt(qty - previous_qty)
-		
-		change_in_qty = row.qty != "" and \
-			(flt(row.qty) != flt(previous_sle.get("qty_after_transaction")))
-
-		change_in_rate = row.valuation_rate != "" and \
-			(flt(row.valuation_rate) != flt(previous_sle.get("valuation_rate")))
 			
 		if change_in_qty:
 			incoming_rate = _get_incoming_rate(flt(row.qty), flt(row.valuation_rate),
@@ -158,23 +160,27 @@
 			# -1 entry
 			self.insert_entries({"actual_qty": -1}, row)
 		
-	def sle_for_fifo(self, row, previous_sle):
+	def sle_for_fifo(self, row, previous_sle, change_in_qty, change_in_rate):
 		"""Insert Stock Ledger Entries for FIFO valuation"""
-		previous_stock_queue = json.loads(previous_sle.stock_queue)
+		previous_stock_queue = json.loads(previous_sle.stock_queue or "[]")
 		
-		if previous_stock_queue != [[row.qty, row.valuation_rate]]:
-			# make entry as per attachment
-			self.insert_entries({"actual_qty": row.qty, "incoming_rate": row.valuation_rate},
-				row)
+		if change_in_qty:
+			if previous_stock_queue != [[row.qty, row.valuation_rate]]:
+				# make entry as per attachment
+				self.insert_entries({"actual_qty": row.qty, "incoming_rate": row.valuation_rate}, row)
 		
-			# Make reverse entry
-			qty = sum((flt(fifo_item[0]) for fifo_item in previous_stock_queue))
-			self.insert_entries({"actual_qty": -1 * qty}, row)
-	
+				# Make reverse entry
+				qty = sum((flt(fifo_item[0]) for fifo_item in previous_stock_queue))
+				self.insert_entries({"actual_qty": -1 * qty, 
+					"incoming_rate": qty < 0 and row.valuation_rate or 0}, row)
+					
+		elif change_in_rate:
+			pass
 					
 	def insert_entries(self, opts, row):
 		"""Insert Stock Ledger Entries"""
 		args = {
+			"doctype": "Stock Ledger Entry",
 			"item_code": row.item_code,
 			"warehouse": row.warehouse,
 			"posting_date": self.doc.posting_date,
@@ -185,8 +191,12 @@
 			"is_cancelled": "No"
 		}
 		args.update(opts)
+		print args
+		sle_wrapper = webnotes.model_wrapper([args]).insert()
+
+		update_entries_after(args)
 		
-		return webnotes.model_wrapper([args]).insert()
+		return sle_wrapper
 		
 	def delete_stock_ledger_entries(self):
 		"""	Delete Stock Ledger Entries related to this Stock Reconciliation
diff --git a/stock/doctype/stock_reconciliation/test_stock_reconciliation.py b/stock/doctype/stock_reconciliation/test_stock_reconciliation.py
index b967b8a..48f0019 100644
--- a/stock/doctype/stock_reconciliation/test_stock_reconciliation.py
+++ b/stock/doctype/stock_reconciliation/test_stock_reconciliation.py
@@ -31,23 +31,45 @@
 		self.insert_test_data()
 
 	def tearDown(self):
-		print "Message Log:", webnotes.message_log
+		# print "Message Log:", "\n--\n".join(webnotes.message_log)
+		# print "Debug Log:", "\n--\n".join(webnotes.debug_log)
 		webnotes.conn.rollback()
 		
-	def test_reco_for_fifo(self):
-		webnotes.conn.set_value("Item", "Android Jack D", "valuation_method", "FIFO")
-		self.submit_stock_reconciliation("2012-12-26", "12:05", 50, 1000)
+	def test_reco_for_fifo(self):		
+		# [[qty, valuation_rate, posting_date, posting_time]]
+		input_data = [
+			# [50, 1000, "2012-12-26", "12:00", 50000], 
+			# [5, 1000, "2012-12-26", "12:00", 5000], 
+			# [15, 1000, "2012-12-26", "12:00", 15000], 
+			# [25, 900, "2012-12-26", "12:00", 22500], 
+			# [20, 500, "2012-12-26", "12:00", 10000], 
+			# [50, 1000, "2013-01-01", "12:00", 50000], 
+			# [5, 1000, "2013-01-01", "12:00", 5000],
+			["", 800, "2012-12-26", "12:05", 12000],
+			# [20, "", "2012-12-26", "12:05", 16000]
+		]
+			
+		for d in input_data:
+			self.insert_existing_sle("FIFO")
+			
+			reco = self.submit_stock_reconciliation(d[0], d[1], d[2], d[3])
 		
-		res = webnotes.conn.sql("""select stock_queue from `tabStock Ledger Entry`
-			where item_code = 'Android Jack D' and warehouse = 'Default Warehouse' 
-			and voucher_no = 'RECO-001'""")
+			res = webnotes.conn.sql("""select stock_queue from `tabStock Ledger Entry`
+				where item_code = 'Android Jack D' and warehouse = 'Default Warehouse'
+				and posting_date = %s and posting_time = %s order by name desc limit 1""", 
+				(d[2], d[3]))
+				
+			stock_value = sum([v[0]*v[1] for v in json.loads(res[0][0] or "[]")])
+			self.assertEqual(stock_value, d[4])
+			
+			self.tearDown()
+			self.setUp()
+					
 		
-		self.assertEqual(res[0][0], [[50, 1000]])
-		
-	def test_reco_for_moving_average(self):
+	def atest_reco_for_moving_average(self):
 		webnotes.conn.set_value("Item", "Android Jack D", "valuation_method", "Moving Average")
 		
-	def submit_stock_reconciliation(self, posting_date, posting_time, qty, rate):
+	def submit_stock_reconciliation(self, qty, rate, posting_date, posting_time):
 		return webnotes.model_wrapper([{
 			"doctype": "Stock Reconciliation",
 			"name": "RECO-001",
@@ -61,65 +83,69 @@
 		}]).submit()
 		
 	def insert_test_data(self):
-		# create item groups and items
-		insert_test_data("Item Group", 
-			sort_fn=lambda ig: (ig[0].get('parent_item_group'), ig[0].get('name')))
-		insert_test_data("Item")
-		
 		# create default warehouse
 		if not webnotes.conn.exists("Warehouse", "Default Warehouse"):
 			webnotes.insert({"doctype": "Warehouse", 
 				"warehouse_name": "Default Warehouse",
 				"warehouse_type": "Stores"})
-				
+
 		# create UOM: Nos.
 		if not webnotes.conn.exists("UOM", "Nos"):
 			webnotes.insert({"doctype": "UOM", "uom_name": "Nos"})
+			
+		# create item groups and items
+		insert_test_data("Item Group", 
+			sort_fn=lambda ig: (ig[0].get('parent_item_group'), ig[0].get('name')))
+		insert_test_data("Item")
+		
+	def insert_existing_sle(self, valuation_method):
+		webnotes.conn.set_value("Item", "Android Jack D", "valuation_method", valuation_method)
+		webnotes.conn.set_default("allow_negative_stock", 1)
 		
 		existing_ledgers = [
 			{
 				"doctype": "Stock Ledger Entry", "__islocal": 1,
 				"voucher_type": "Stock Entry", "voucher_no": "TEST",
 				"item_code": "Android Jack D", "warehouse": "Default Warehouse",
-				"posting_date": "2012-12-12", "posting_time": "01:00:00",
+				"posting_date": "2012-12-12", "posting_time": "01:00",
 				"actual_qty": 20, "incoming_rate": 1000, "company": company
 			},
 			{
 				"doctype": "Stock Ledger Entry", "__islocal": 1,
 				"voucher_type": "Stock Entry", "voucher_no": "TEST",
 				"item_code": "Android Jack D", "warehouse": "Default Warehouse",
-				"posting_date": "2012-12-15", "posting_time": "02:00:00",
+				"posting_date": "2012-12-15", "posting_time": "02:00",
 				"actual_qty": 10, "incoming_rate": 700, "company": company
 			},
 			{
 				"doctype": "Stock Ledger Entry", "__islocal": 1,
 				"voucher_type": "Stock Entry", "voucher_no": "TEST",
 				"item_code": "Android Jack D", "warehouse": "Default Warehouse",
-				"posting_date": "2012-12-25", "posting_time": "03:00:00",
+				"posting_date": "2012-12-25", "posting_time": "03:00",
 				"actual_qty": -15, "company": company
 			},
 			{
 				"doctype": "Stock Ledger Entry", "__islocal": 1,
 				"voucher_type": "Stock Entry", "voucher_no": "TEST",
 				"item_code": "Android Jack D", "warehouse": "Default Warehouse",
-				"posting_date": "2012-12-31", "posting_time": "08:00:00",
+				"posting_date": "2012-12-31", "posting_time": "08:00",
 				"actual_qty": -20, "company": company
 			},
 			{
 				"doctype": "Stock Ledger Entry", "__islocal": 1,
 				"voucher_type": "Stock Entry", "voucher_no": "TEST",
 				"item_code": "Android Jack D", "warehouse": "Default Warehouse",
-				"posting_date": "2013-01-05", "posting_time": "07:00:00",
+				"posting_date": "2013-01-05", "posting_time": "07:00",
 				"actual_qty": 15, "incoming_rate": 1200, "company": company
 			},
 		]
 		
-		pprint(webnotes.conn.sql("""select * from `tabBin` where item_code='Android Jack D' 
-			and warehouse='Default Warehouse'""", as_dict=1))
+		# pprint(webnotes.conn.sql("""select * from `tabBin` where item_code='Android Jack D' 
+		# 			and warehouse='Default Warehouse'""", as_dict=1))
 		
 		webnotes.get_obj("Stock Ledger").update_stock(existing_ledgers)
 		
-		pprint(webnotes.conn.sql("""select * from `tabBin` where item_code='Android Jack D' 
-			and warehouse='Default Warehouse'""", as_dict=1))
+		# pprint(webnotes.conn.sql("""select * from `tabBin` where item_code='Android Jack D' 
+		# 	and warehouse='Default Warehouse'""", as_dict=1))
 			
 		
\ No newline at end of file
diff --git a/stock/stock_ledger.py b/stock/stock_ledger.py
index bb02f8c..95c74d7 100644
--- a/stock/stock_ledger.py
+++ b/stock/stock_ledger.py
@@ -40,6 +40,7 @@
 	qty_after_transaction = flt(previous_sle.get("qty_after_transaction"))
 	valuation_rate = flt(previous_sle.get("valuation_rate"))
 	stock_queue = json.loads(previous_sle.get("stock_queue") or "[]")
+	stock_value = 0.0
 
 	entries_to_fix = get_sle_after_datetime(previous_sle or \
 		{"item_code": args["item_code"], "warehouse": args["warehouse"]})
@@ -47,8 +48,7 @@
 	valuation_method = get_valuation_method(args["item_code"])
 	
 	for sle in entries_to_fix:
-		if sle.serial_nos or valuation_method == "FIFO" or \
-				not cint(webnotes.conn.get_default("allow_negative_stock")):
+		if sle.serial_nos or not cint(webnotes.conn.get_default("allow_negative_stock")):
 			# validate negative stock for serialized items, fifo valuation 
 			# or when negative stock is not allowed for moving average
 			if not validate_negative_stock(qty_after_transaction, sle):
@@ -75,7 +75,7 @@
 				(qty_after_transaction * valuation_rate) or 0
 		else:
 			stock_value = sum((flt(batch[0]) * flt(batch[1]) for batch in stock_queue))
-
+			
 		# update current sle
 		webnotes.conn.sql("""update `tabStock Ledger Entry`
 			set qty_after_transaction=%s, valuation_rate=%s, stock_queue=%s, stock_value=%s,
@@ -83,7 +83,7 @@
 			json.dumps(stock_queue), stock_value, incoming_rate, sle.name))
 		
 	if _exceptions:
-		_raise_exceptions(args)
+		_raise_exceptions(args, verbose)
 	
 	# update bin
 	webnotes.conn.sql("""update `tabBin` set valuation_rate=%s, actual_qty=%s, stock_value=%s, 
@@ -103,16 +103,17 @@
 	"""
 	sle = get_stock_ledger_entries(args,
 		["timestamp(posting_date, posting_time) < timestamp(%(posting_date)s, %(posting_time)s)"],
-		"limit 1")
+		"desc", "limit 1")
 	
 	return sle and sle[0] or webnotes._dict()
 	
 def get_sle_after_datetime(args):
 	"""get Stock Ledger Entries after a particular datetime, for reposting"""
 	return get_stock_ledger_entries(args,
-		["timestamp(posting_date, posting_time) > timestamp(%(posting_date)s, %(posting_time)s)"])
+		["timestamp(posting_date, posting_time) > timestamp(%(posting_date)s, %(posting_time)s)"],
+		"asc")
 				
-def get_stock_ledger_entries(args, conditions=None, limit=None):
+def get_stock_ledger_entries(args, conditions=None, order="desc", limit=None):
 	"""get stock ledger entries filtered by specific posting datetime conditions"""
 	if not args.get("posting_date"):
 		args["posting_date"] = "1900-01-01"
@@ -124,10 +125,11 @@
 		and warehouse = %%(warehouse)s
 		and ifnull(is_cancelled, 'No') = 'No'
 		%(conditions)s
-		order by timestamp(posting_date, posting_time) desc, name desc
+		order by timestamp(posting_date, posting_time) %(order)s, name %(order)s
 		%(limit)s""" % {
 			"conditions": conditions and ("and " + " and ".join(conditions)) or "",
-			"limit": limit or ""
+			"limit": limit or "",
+			"order": order
 		}, args, as_dict=1)
 		
 def validate_negative_stock(qty_after_transaction, sle):
@@ -202,7 +204,7 @@
 	
 	if not stock_queue:
 		stock_queue.append([0, 0])
-	
+
 	if actual_qty > 0:
 		if stock_queue[-1][0] > 0:
 			stock_queue.append([actual_qty, incoming_rate])
@@ -213,6 +215,9 @@
 		incoming_cost = 0
 		qty_to_pop = abs(actual_qty)
 		while qty_to_pop:
+			if not stock_queue:
+				stock_queue.append([0, 0])
+			
 			batch = stock_queue[0]
 			
 			if 0 < batch[0] <= qty_to_pop:
@@ -233,10 +238,10 @@
 	stock_qty = sum((flt(batch[0]) for batch in stock_queue))
 
 	valuation_rate = stock_qty and (stock_value / flt(stock_qty)) or 0
-	
+
 	return valuation_rate, incoming_rate
 
-def _raise_exceptions(args):
+def _raise_exceptions(args, verbose=1):
 	deficiency = min(e["diff"] for e in _exceptions)
 	msg = """Negative stock error: 
 		Cannot complete this transaction because stock will start