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Hi All, I would like to seek assistance, I am trying to change the cost method of an item from FIFO to Average, but upon doing so, there's an error shown on the image.
There are no Purchase Order nor Sales Order with the said item.
Thank you!
Excellent explanation. Thanks for sharing.
Michael,
This message is valid and true. You cannot change the Costing Method of an Item if an Item Ledger Entry is present. To change the costing method of an Item, here is my take/process:
The official way of changing the costing method for any items in Dynamics 365 (Dynamics NAV) is to basically zero out the item and create a new set of item numbers with the new costing method.
However, doing this may not be feasible because you end up losing all item history, in addition, depending on how much history you have, renaming item numbers will take a long, long time. Below is another way but you will need Partner assistance.
Before the company can make such a change to the costing method, the following tasks has to be done:
The biggest problem that companies run into is documents that are “stuck in the middle”, basically, shipped/received not invoiced. By not having a clean break, if you were to proceed with the costing method change, you will never be able to tie out your inventory valuation to the General Ledger.
Here’s what you will need to do in Dynamics 365 (Dynamics NAV) in order to convert to a different costing method:
Then done, you’re done.
For example, if we change the items from FIFO to standard on 03/31/2021, no additional postings for these items on or prior to 03/31/2021 should be made. This will need to controlled through the Allow Posting From on the General Ledger Setup and the User Setup.
In addition, revaluation of inventory should not be done prior to 03/31/2021 as well for the items. Doing so may cause irreparable damage on the inventory value and will cause your inventory ledger to not match your G/L.
The method described above is not recommended but doable. I think this is because there are many ways things can go wrong if not done properly. Having said that, I have done this for many of our customers without problems. Strict controls on when the posting is allowed must be followed. If done properly, changing costing method is really not that big of a deal.
Hope this helps.
Thanks,
Steve
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