Item Costing Method Change

Cem_Karaer

Hi everyone!
There are some newly created items whose costing methods were mistakenly chosen as FIFO rather than Average. Those items had also zero unit cost when they were firstly created. Some of them were only sold (making their inventory decrease below zero; no purchase) and others were only purchased (no sale). But some only-purchased items were transfered between locations.
If I change the costing methods of those items brutally (using C/AL code without field validation or on SQL server), is it a GREAT possibility that I will face a GREAT catastrophic result? (I'm well aware that brutality is a bad thing but I have no way out)

cernst

If you do this "brutally" then you should first make sure that inventory is zero and that all postings on this items are invoiced, so that the adjust cost job will not take these transactions in consideration. Then you could change costing method. I've done this a couple och times but only between standard and FIFO so I don't know if this would be any different but I dont think so.

If you don't want to use code why not change item no. and then make a new item with the same no.? You'll miss the statistic but if it is'nt many transaction then this might be a better and safer way.

apertierra

Changing the costing method in an item implies a revaluation of your inventory account, so if you "brutally" change it by code you might "just" screw up the whole inventory valuation...
The method to follow is to zero out all the inventory, change the method and put back the proper quantities into the inventory with the new method already setup (you don't need any "brutally" method if the inventory has been zero'ed out).

cernst

You still need to make it "brutally" even if inventory is zeroed out. If there is any transactions then you can't change costing method even if inventory is zero.

rajpatelbca

hi experts,

i know this is so many time discussed earlier.

i have a same problem. in my case, i have already entered opening stock. few item are sold. there is no purchase order and prod. order of item is available. now i want change costing method of an item.

i know that there are two alternative way to resolve this suggested by Kine.

if i disable code and change item costing method to another. and code enable again.

give me ideas.

Cem_Karaer

Well, if there is no inbound transaction, what will be the inventory value of an item that has outbound transactions with zero unit cost? If there is only one inbound transaction and no outbound transaction for an item, why does Navison worry about the costing method of the item?

apertierra

Because it doesn't check if there is just one transaction, but if there is ANY open item ledger entry. (It doesn't care if is one or 100). If there is an open transaction it doesn't let you change the inventory costing method.
Again, simple as creating a batch to "zero out" all the inventory (one item journal line per open item ledger entry if you want to keep "history"), a copy of the same batch with reverse quantities and same costs in a different batch, post the first one, change the costing methods, post the second one, check the results.

rajpatelbca

thank you apertierra & cemkaraer for your reply.
but i cant get you properly could you explain in detail with some example. :?

Not a single purchase order of an items available (No Inbound entries).

most of all item inventory is less then zero.

Column of Value entries

Cost amount(Actual)
Cost amount(expected)
Cost amount(non-invtbl)
cost posted to G/L
cost per unit
cost per unit(ACY)

are zero.
i am using Nav 5.0

now what should i do ?

pls. suggest any idea.


[-o<

jlandeen

I've had to do this a few times now and everytime it's always been quite problematic (as it's not simple). As already stated here it has to do with open item ledger entries and not really about the costs.

If there are only a few items to be dealt with it can be handled manually by posting item journals and doing the following (in order):
- post neg/pos. adjustments to bring items inventory level to 0 (there should be no open item ledger entries at this point).
- change costing method
- post pos/neg. adjustments that put the inventory level back to it's original level (i.e. to reverse the first set you posted)

If you're using item tracking or have any other inventory complications (warehousing, multiple locations, etc.) then this is more complicated and you may find it easier to write code/process only reports that generate the set of entries (and the reversing set).

So basically - changing the costing method takes a lot of time & energy so try & get it right before when you create the item record. Resist the urge to skip the validation on the cost method field (it's there for a reason and you're probably going to cause way more problems down the road by brute forcing any change)