Assembly Issue: NAV recognizes rounding difference as variance

(0) Share

Report

Posted on by ShanilAlg

Environment: Unmodified Cronus Database – 9.0.47042.0 (NAV 2016)

Scenario:

Define two items.

Raw Material
No: RM001
Description: Raw Material
Costing Method: FIFO
Unit Cost - $0.013 (this is common if it is purchased in bulk qty, e.g. $32.50 for qty 2160)
Replenishment: Purchase
Rounding Precision: 0.00001

Finished Good
No: FG001
Description: Finished Good
Costing Method: Standard
Assembly BoM: 1 qty of RM001
Unit Cost - $0.013 (Calculated)
Replenishment: Assembly
Rounding Precision: 0.00001

Process: Create an Assembly Order for 300 quantities. Carryout multiple postings 80, 40, 180. Check the financial entries.

Problem: There are Material Variance financial entries passed on to the Material Variance account and Inventory account. In the above scenario there is no cost or quantity difference. The system is recognizing a rounding difference as variance. E.g.: on the second posting the variance is 0.003*40 = 0.12. Anything beyond the 2nd decimal is considered as a variance which is wrong.

The Inventory Setup parameters are as follows,
Automatic Cost Posting: Yes
Expected Cost Posting to G/L: Yes
Automatic Cost Adjustment: Always
Average Cost Period: Day

This above issue can be also replicated in:
NAV 2013 R2 – 7.1.39665.0
NAV BC on premise – 13.0.27183.0
This does not occur if the RM cost does not exceed two decimals.

Does anyone know if there is some fix for this?

Categories:

Inventory and warehouse management

Warehouse

All responses (8)

Answers (0)

ShanilAlg 15 on at

Like (0)

Report

RE: Assembly Issue: NAV recognizes rounding difference as variance

Hi Alfredo, I tried out your suggestion, unfortunately the outcome did not change. It still mistook rounding for a material variance.
ShanilAlg 15 on at

Like (0)

Report

RE: Assembly Issue: NAV recognizes rounding difference as variance

Thanks Alfredo, I shall test this and see if it addresses the issue that I am having
Suggested answer

azelaya59 2,807 on at

Like (0)

Report

RE: Assembly Issue: NAV recognizes rounding difference as variance

If you haven't already checked, I just read on another post in regards to the Unit Cost decimal places in the Gen Ledger Setup:

On this table 98 General Ledger Setup, you can change the decimal places. In my case the decimals are set to 2:5. You can change it to 2:2 and I believe this is what you are looking to do.

Go to the Development Client and run Table 98:

Then change the Unit Cost Decimal places to 2:2

Good Luck!
azelaya59 2,807 on at

Like (0)

Report

RE: Assembly Issue: NAV recognizes rounding difference as variance

If you are the VAR/Partner you can open a ticket with Microsoft. If you are the customer, have your VAR/Partner open the ticket. Check Partner Source / Customer Source for any suggestions from Microsoft.
ShanilAlg 15 on at

Like (0)

Report

RE: Assembly Issue: NAV recognizes rounding difference as variance

I was trying to avoid customizing the calculation core as it may introduce other issues specially with the variance calculations. I was wondering if Microsoft was aware of this and if there maybe a possible fix
azelaya59 2,807 on at

Like (0)

Report

RE: Assembly Issue: NAV recognizes rounding difference as variance

Unless you can raise the assembly requirement to 1000 units consumed making the unit cost 7.15 you'll need to do customization to ignore the standard NAV behavior.
ShanilAlg 15 on at

Like (0)

Report

RE: Assembly Issue: NAV recognizes rounding difference as variance

No the rounding precision in the GL is for two decimals. That is why were are having this problem. If you look at the practical side of it having the GL in more than two decimals makes no financial sense and most customers would not want it. But when it comes to Assembly, customers many buy raw materials in large UoMs but use it in smaller UoMs for Assembly. Example they could by a box of 5000 combs for $35.75 but use 1 comb per Assembled item. So now the raw material cost per assembled item ($35.75/5000) goes beyond 2 decimals and that triggers this abnormal variance.
azelaya59 2,807 on at

Like (0)

Report

RE: Assembly Issue: NAV recognizes rounding difference as variance

Question........... is the rounding precision in the General Ledger Setup also 0.00001?