Serious Average Cost Problems

ctnoble58

I have just started working for a company that implemented Navision. Version GB 3.70

The system is configured to use average costing at item/location/variant level. All products use average costing.

There are major problems with the way average costs are being calculated.

1) sometimes the average cost on the SKU does not match the values posted from purchases. We have some cases where a product has only been purchased once but the average cost does not match the invoice cost.
2) sometimes the average cost returns to 0.00 even when there is stock
3) the cost posted to stock entries does not match the cost posted to sales invoices so we can't work out true margins by customer.

I've seen lots of postings about problems with costing in Navision. Has anyone ever managed to get it to post the correct costs through all postings?

Kowa

There are numerous design flaws in inventory costing, especially in the older versions.
If possible , try to upgrade to the newest version.

In a recent FAQ document about the changes in cost adjustment it was recommended to make the field "Average Cost (LCY)" invisible if the costing method is "Average" because the values displayed can be confusing ( expected costs not yet invoiced are sometimes included in the calculation, which is not correct ). Use only the field "Unit Cost".

The costs in sales invoice lines are not updated during the cost adjustment, even in the newest versions. An additional batch job is necessary for this ( customization, but quite a straightforward job)

Miklos_Hollender

About the third one: cost in Invoices is not adjusted so it's just useless, forget it and report margins from Item Ledger Entries by Entry Type = Sale, Source Type = Customer, Source No. = Customer.No.

dmitrip

Hi ctnoble58,
Please take a look at Partner Source. There's an article "The "Average Cost Calc. Type". I think it usefull since you're using average cost by Item & Location & Variant.