Hi MYGz,
1) Issue
- A Purchase Order is created in source legal entity USMF and receipt is performed in an external warehouse legal entity (EXWH) using non-valuated inventory
- The ordered quantity is 4, but only 3 were physically delivered, while 4 were mistakenly registered as received in EXWH via message processing (batch)
- Requirement is to correct the over-received quantity (1 unit) in EXWH without posting receipt in USMF
- In a second scenario, receipt and invoicing are completed in USMF and additional charges are applied, but afterwards 1 unit must be returned and the weighted average cost becomes incorrect
2) Reason
- In an external warehouse (non-valuated), inventory transactions are still tracked physically, but financial impact is managed in the source legal entity
- Once receipt is posted (even via integration/message processor), the system creates inventory work and transactions that must be reversed properly rather than edited directly
- Over-receipt cannot simply be adjusted without reversing the warehouse transaction because it breaks inventory consistency
In the second scenario, weighted average cost is recalculated based on:
- Total financial value (including charges)
- Total received/invoiced quantity
- When a return order is created after invoicing, the system posts a financial adjustment at the current cost, not necessarily restoring the original weighted average accurately
- Charges posted on the invoice further distort the unit cost, and standard return processes do not redistribute those charges proportionally
3) Resolution
Scenario 1 (External Warehouse EXWH correction):
- Create a movement or inventory adjustment journal in EXWH to reduce the excess quantity by 1
- Alternatively, reverse the receipt using:
- Cancel work (if still open)
- Or post a negative registration / adjustment depending on process stage
- Ensure the correction is done only in EXWH since the inventory is non-valuated and not yet financially posted in USMF
- Validate that integration or message processor does not re-send incorrect quantities
Scenario 2 (USMF weighted average correction after invoicing):
- Create a Purchase Return Order for the excess quantity (1 unit)
- Post return receipt and invoice to reverse inventory and financial impact
- Note that this will use current weighted average cost, not original unit cost including charges
- To correct weighted average cost accurately:
- Post a manual inventory adjustment journal (value adjustment) to align inventory value
- Or use inventory recalculation / inventory close to redistribute cost differences
- If charges caused distortion:
- Consider adjusting charges manually using a correction transaction
- Review costing configuration to ensure consistent behavior with weighted average method
- Perform full reconciliation after adjustments to confirm inventory quantity and value are correct
For a more detailed answer, please provide more information.
Rg,
Alexander
*Due to the complex and different possibilities of deploying Dynamics 365 I highly recommend not to setup the application without some expert/partner or support. (For more information contact me under anassl@inno-solutions.info or visit www.inno-solutions.de)
*The Information comes directly from the manufacturer or provider and are validated (not guaranteed) up to date of creation of the posting.
References:
- Microsoft Licensing Guide
- Microsoft Doc`s/Learn
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