Hi
It is very interesting requirement.
As per my experience, parallel inventory valuation using LIFO for statutory and Weighted Average for managerial reporting is possible in D365 F&O, but it requires a logical setup using either dual legal entity.
approach and core challenge
D365 F&O allows only one inventory valuation method per item per legal entity, defined via the Item model group. We cannot apply both LIFO and Weighted Average simultaneously within the same legal entity for the same item.
Implementation Option is Dual Legal Entity Setup
Legal Entity A: Uses LIFO for statutory accounting.
Legal Entity B: Uses Weighted Average for managerial/internal reporting.
Synchronize inventory transactions between entities using logic app or power automate flow and this requires extensive design on logics behind the business processes.
Finally generate reports from each entity independently
The setup would be clean separation, aligns with audit and compliance but this would requires duplication of inventory data and careful reconciliation.
Otherwise
build custom extensions that
1.Track alternate cost layers in custom tables.
2. Recalculate weighted average cost for reporting.
3. Use isolated reporting logics to build a report.
