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Dynamics 365 Community / Forums / Microsoft Dynamics AX (Archived) / Inventory reconciliati...
Microsoft Dynamics AX (Archived)

Inventory reconciliation with GL

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Posted on by imran ul haq 4,017

Hi Friends,

I am trying to reconcile the inventory (Raw material And finish goods), and getting the differences, some of the differences i found that are the direct GL entries but still some differences are there, can you please tell me how i can know the differences are coming from where.

Can any one tell me the procedure for the reconciliation and the reasons other than the GL entries.

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  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hello Imran,

    The easiest approach in my opinion is if you have setup all of your items with an item financial dimension as this allows you a very fast and easy investigation of where differences come from.

    If you haven't implemented a item financial dimension you have to make use of the standard tools, such as the inventory value report, the potential conflicts report, etc. This also works fine but might require a bit more effort to get the numbers reconciled.

    Another alternative is the inventory value cube, which necessitates that you make use of it and have processed it.

    Hope this helps,

    Ludwig

  • imran ul haq Profile Picture
    imran ul haq 4,017 on at

    Thanks Ludwig for your reply.

    We are not using the financial dimension at Item level, also not using the cube at this moment.

    I tried with the Inventory value and inventory potential conflict report:

    4118.pc.jpg

    I generated potential conflict report with the raw material ledger account (only one ledger account using for the raw material) and got the above result. Inventory value showing here is combined or say the full inventory value included the finish goods, and the same value i am getting when i generate the inventory value report for full inventory. But the discrepancy showing $-870385.60, i am not getting this value as i found only $-260385.60 in the raw material GL as the GL manual entry.

    And if i only generate the inventory value for the raw material value is $8,626329.13 and GL value is $8941138.48 so the difference is $314809.35 out of which the GL value is $260562.20, the remaining will be $54247.15, how i can trace this remaining amount.

    Also when i generate the inventory value for the finish goods it is showing in negative ($-555576.25), and for some item (4) it is negative  out of which for 1 item its huge negative amount of $-1833699.12 and qty is zero. Also how can i fix negative amount.

  • imran ul haq Profile Picture
    imran ul haq 4,017 on at

    And also when i combine my inventory GL accounts and total inventory, following are the details:

                    

      GL Balance Module Balance
    Raw Material $8,941,138.48 $8,626,329.13
    Finish Goods $1,818,691.89 ($555,576.25)
    Total $10,759,830.37 $8,070,752.88
    Difference in GL And module $2,689,077.49
    GL Entries  
    Raw Material $260,562.20
    Finish Goods $2,544,808.63
    Total GL Entries $2,805,370.83
    Difference After GL Reversal ($116293.34)  

    Module value will become more than the GL

  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hello Imran,

    Unfortuantely, there is no straightforward and easy way forward available for this reconciliation process. What you can try to do is exporting the ledger transactions from GL by including the transaction and posting type fields. Those fields might help you identifying whether for example some manual postings have been made on the automatic inventory accounts.

    What might help also are the reconciliation reports available in GL.

    Yet, irrespective of that, the whole process might be quite 'painful' in the sense that you will probably need some time to identify what caused the difference.

    Best regards,

    Ludwig

    P.S. Probably think to implement a financial item dimension for the future, as it will help you to identify those differences pretty fast.

  • Suggested answer
    guk1964 Profile Picture
    guk1964 10,888 on at

    The first problem is "some of the differences i found that are the direct GL entries " this should never happen . The sub ledger accounts should be locked to stop this.

    It sounds as through you need to take support from an Ax consultant.  We have a lot of experience with inventory reconciliation .

    if this is a recurring problem and  your company wishes to invest then we have developed some analysis forms e.g. to see inventory movement by item by transaction for a specified period.

  • imran ul haq Profile Picture
    imran ul haq 4,017 on at

    Thanks Ludwig for reply.

    Yes reconciliation is a painful job, actually just need some direction where to move and the area or report to look on.

    What you were telling i already check with the posting type, and the only differences i found is the GL entries.

    As i mentioned in my previous post (details with values), after reversing the GL entries my GL will be more than module, how i can trace this.

  • Suggested answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hi Imran Ul Haq,

    What I am always doing in those cases is first creating a list of all the 'automatic' accounts that are included in the inventory posting matrix under inventory-setup-posting-posting.

    Once I got that I export all ledger account transactions for those accounts to Excel including the posting and transaction type that indicate where the postings on those accounts come from.

    This typically results in some manual transactions that most of the time explain a part of the GL inventory difference.

    Then I often use the inventory value and potential conflicts report to identify if users have changed the item group manually. This information can e.g. be obtained from the potential conflicts report.

    Depending on the messages found in the potential conflict report you can dig deeper and hopefully find the complete difference that you identified.

    Hope this helps,

    Ludwig

  • Mohammed Profile Picture
    Mohammed 510 on at

    Hi,

    You need reconcile.  

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