In this part, we will discuss how to use inventory value report to do inventory reconciliation.
Firstly, let’s imagine a company who has two item groups: Bike and Accessory. The inventory GL account for Bike is 140100. The inventory GL account for Accessory is 140200. Then we have a total GL inventory account 149999. In the total GL account 149999, we set up the account interval from 140000 to 149998.
In both item groups posting profile, packing slip/issue and product receipt /purchase, inventory receipt are all set up with the same GL account. That means both physical inventory and financial inventory are using the same GL account.
At the end of year 2016, we begin to do the reconciliation for the total inventory GL account 149999. In inventory value report ID, we enable the option ’print cumulative account values for comparison’ and input 149999 in the inventory account. We also enable resource group and total. Also please do disable the option ‘included not post to ledger’. This has been discussed in the previous article that ‘Inventory: Physical Amount Not Posted’ should not be included in the reconciliation.
So, you can see the ‘Inventory Amount’ in the report for both item groups. You can also see the closing balance for 149999, 140100 and 140200.
Based on the explanations we discussed before in the part 3, you should do the reconciliation as below:
• The value in the column ‘Inventory Amount’ for both item groups -> The balance of 149999
• The value in the column ‘Inventory Amount’ for item group Bike -> The balance of 140100
• The value in the column ‘Inventory Amount’ for item group Accessory -> The balance of 140200
Normally, we recommend to use the same GL accounts. It happens that the user set different accounts for packing slip and issue or product receipt and purchase. In this situation, you cannot use the ‘Inventory Amount’ value to do the reconciliation. Do you remember the conceptions: physical update and financial update we explained in part 3? You need to reconcile the different GL accounts with ‘Inventory: Financial Amount’ and ‘Inventory: Physical Amount Posted’.
If the user also want to check the quantity, you should use the total quantity = Inventory: Financial Quantity + Inventory: Physical Quantity Posted + Inventory: Physical Quantity Not Posted
Hope the above info can help you during your reconciliation. I believe your next question might be how to deal with the situation that there is discrepancy between inventory value and GL balance. We have another very powerful report named potential conflict report. You can use it to drill down the reason why there is discrepancy. In fact, we recommend to run it periodically, like weekly or bi-weekly. So, you can be aware of the discrepancy earlier and only need to work on a very small data set to find the reason.
There will be articles in future about how to use potential conflict report. I will add the links here if they are published.
Again hope the above info can help. Enjoy!
How to use inventory value report: part 1
How to use inventory value report: part 2
How to use inventory value report: part 3

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In this part, we will discuss the columns’ meaning showing in the inventory value report after you create the inventory value report ID. For how to set up the inventory value report ID, please click here.
In AX, there are two import conceptions, financial updated and physical updated. Financial updated means the inventory transactions are already invoiced (For production orders, it’s production order end.). Physical updated means the inventory transactions are not invoice but received or shipped. (For production order, it means material picked or production order report as finished). After understanding the two concepts, it will be easy to understand the below columns.
Inventory: Financial Quantity – the quantity that are financially updated.
Inventory: Financial Amount –the amount value of inventory that are financially updated.
Inventory: Physical Quantity Posted – the quantity that are physical updated.
Inventory: Physical Amount Posted – the amount value of inventory that are physical updated.
Inventory: Physical Quantity Not Posted –the quantity that has inventory transactions but not posted to the GL. For example, you have item model group which has the options ‘post physical inventory’ and ‘post financial inventory’ disabled. Then you have an item which linked to this item group. Then you have a purchase order, you receive it and invoice it. Then if you check the inventory value report for this item, you will see the quantity and the value in this purchase order are actually under the column ‘Inventory: Physical Quantity Not Posted’ and ‘Inventory: Physical Amount Not Posted’
Inventory: Physical Amount Not Posted – please do not include this amount when you do the inventory reconciliation because this amount is not post into G/L.
Inventory: Quantity –the total quantity of all the qty columns in the report.
Inventory: Amount – the total quantity of all the amount columns in the report. Like the note above, please do not use this column to do the inventory reconciliation if you have the ‘Inventory: Physical Amount Not Posted’ showed in the report. You need to exclude ‘Inventory: Physical Amount Not Posted’ from the total amount.
Average unit cost – total amount divided by total quantity.
How to use inventory value report: part 1
How to use inventory value report: part 2
How to use inventory value report: part 4

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Inventory value report was released from AX 2009 SP1. It’s a very powerful report. Most of the users uses this report to do reconciliation between general ledger and inventory. In this article, we will discuss how to use this report to do the reconciliation between general ledger and inventory.

When we try to view inventory report, we need firstly define the below parameters. Let’s firstly explain the Date interval parameter. The ‘Date interval code’ is used when you want to view the predefined period instead of giving the ‘From date’ and ‘To date’. For example, if you select ‘current period’ in this parameter, AX will calculate the ‘From date’ and ‘To date’ based on the current AX session date. Let’s say the current AX session date is Jan 13 2017, then the ‘From date’ is Jan 1 2017 and the ‘To date’ is Jan 31 2017. If you don’t use date interval code, you can manually filling the ‘From date’ and ‘To date’ based on your need. Actually, ‘From date’ doesn’t change the report figures as the report will calculated the inventory value/quantity and GL balance cutting off on the ‘To date’.

There is one known issue. When you select the same date for both ‘From date’ and ‘To date’ and also enable ‘include beginning balance’ option in inventory value report ID, you may get incorrect beginning balance. This is a by-design scenario.

All the filters in the ‘inventory value’ section will be applied to the inventory transactions but not the G/L balance. So, when you try to use these filters, please keep this in mind. Otherwise, you may see the discrepancy between inventory and G/L account which is caused improper usage of the filters. This topic will be discussed furtherly in the following parts.

In Part 2, we will discuss how to create the most import parameter: inventory value report ID.

How to use inventory value report: part 2
How to use inventory value report: part 3
How to use inventory value report: part 4

The post How to use inventory value report: part1 appeared first on Microsoft Dynamics 365 Blog.

In this part, we will discuss the most import parameter: inventory value report ID. You can go to Inventory management/Setup/Costing/inventory value reports to create IDs. (In AX 2009, the menu path is Inventory management/Setup/inventory value). You can create different IDs for different reporting requirement. For example, you can create the report only showing the total financial amount for financial staff and create a report only showing physical inventory for warehouse management staff.
When you try to create a inventory value report Id, you need to deal with a lot of parameters. Below are the explanations and best practice when using these parameter.
For the columns of financial position, you can only tick ‘inventory’ if you want to reconcile the inventory value with inventory G/L accounts balance. Or you can only tick ‘WIP’, if you want to reconcile the WIP value with WIP G/L accounts balance.
If you tick the ‘WIP’ option, only the physical quantities and amounts of inventory in WIP status will show in the report. In WIP status means production orders that have been picked or reported finished but not ended.
Please enable the option ’print cumulative account values for comparison’, if you want the G/L accounts balance showing in the report. By doing this, you don’t need to check the trail balance.
After you enable this option, you need to fill in the G/L account you want to reconcile.
For the ‘Inventory dimensions’ area, you can select the dimensions that you want to show in the report. Please be noted that only the dimensions that have ‘financial inventory’ option enabled can be showed in the report, otherwise you will only see blank columns. For more information, you can check this
The ‘Summarize’ option is ticked when you only want check the total inventory quantity and inventory amount. If it’s not ticked, the report will show both physical and inventory financial values.
The ‘Included not posted to ledger’ option is not recommended to ticked because those transactions that never post to G/L should not be included when you doing the inventory reconciliation.
The ‘Average Unit Cost’ option is suggested to be ticked if you want to check the average unit cost. The ‘Average Unit Cost’ is just a simple calculation: total quantity divided by the total amount.
The ‘Print Total’ option can only be ticked when the ‘summarize’ option is not ticked. The report will show additional two columns for the total quantity of inventory physical and financial quantities and the total amount of inventory physical and financial amounts.
The ‘Resource ID’ mostly means the item number.
The ‘Resource Group’ mostly mean item group.
If either ‘Resource ID’ or ‘Resource Group’ are not ticked, you will only see a total inventory value based on the inventory dimensions you selected.
The option ‘Detail Level’ enable the user to select different view of the report. If you want to view the report per transactions, you can select transactions. Otherwise, please select ‘total’. Please be noticed that there might be slow performance issue f you are trying to view a large volume of data on ‘transactions’ level
The option ‘Include beginning balance’ is only available when you select ‘transactions’ in detail level option.
Note: There is a known issue that incorrect figure will show in the report if the from and to date are the same day and the option ‘Include beginning balance’ is ticked. Please do not use in this way.

How to use inventory value report: part 1
How to use inventory value report: part 3
How to use inventory value report: part 4

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Normally, we use inventory value report to view the inventory value and quantity. Sometimes, we cannot see some inventory dimensions in the report. To make the inventory dimensions showing in the report, you need to make sure:
1） Go to USMF/Inventory management/Setup/Inventory/Inventory value reports, select the inventory value report ID which you use to view the report and make sure the inventory dimensions are selected.
2） Check the item storage and tracking dimension groups. Only the dimensions that have the option ‘financial inventory’ enabled can be shown in the report.
For example, there is an item ‘test’. In the storage dimensions group, only site is financial inventory enabled. Site and warehouse are both physical inventory enabled. In the tracking dimension group, batch number is physical inventory enabled while financial inventory is disabled.
Now in the inventory value report ID settings, site, warehouse and batch number are all selected. If we view the report, we can only see site is shown in the report while warehouse and batch number columns are blank.
In conclusion, inventory value report can only show the inventory dimensions which are financial inventory enabled. This logic is also applied for Dynamics 365 for Operations.

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