8.3: Inventory Journals Setup (SCM P1 M8L3)

When a new inventory journal is created, the Name field is required. The journal names that are selected in this field are created in the Journal names form.

Procedure: Create a Journal Name

To set up journal names which are then used to create journals, follow these steps:

1. Open Inventory management > Setup > Journal names > Inventory.

Figure 8.1 JOURNAL NAMES INVENTORY

1. In the Inventory journal names form that opens, create a new record and type the journal name and its description.
2. Select the Journal type that determines what the journal is used for.
3. Select a Voucher series from the list.
4. On the General fast tab, in Selection by, specify whether the line receives a voucher number when the line is entered or when it is posted.
   For example, the Selection by field helps you assign voucher numbers at posting time when a journal is started at the start of a day; multiple entries can be made by different people and/or at different times during the day.
   Without the Selection by option, all entry lines have a different voucher number. This makes tracking difficult. With this posting option, voucher numbers are assigned at the time of posting, and are therefore more consistent throughout the journal.
5. In the New voucher by field, specify when a new voucher is allocated, by either of the following:

• Change date (enables tracking by date)
• Change date or item

This resembles the Selection by option, that enables tracking by one voucher number, in addition to all entries that are registered in the same journal for the same date and the same item. This option helps simplify tracking.

1. Select value in the Detail level field for the journal.
   The Summary option in the Detail level field is a good choice when you are generating many entries by using journals for the same date, account number, dimensions, and currency code. By doing this, the General ledger is only populated with one summary transaction for each identical value. Therefore, reducing the number of transactions. However, this does not summarize these entries in inventory transactions.
2. Select or clear the Delete lines after posting check box.
   After posting, the lines typically have only historic value and can therefore be deleted. However, sometimes, a business wants to keep the lines for reference.
3. In Offset account, specify an offset account if the journal name is for the Movement journal type.
4. Select the method of inventory Reservation for the inventory journal.

• Manual – Inventory for orders is reserved manually.
• Automatic – Inventory is reserved when order lines are created, in the order in which the order lines are created. For bills of materials (BOMs), reservations are made for the BOM item number, not for the individual elements of the BOM.
• Explosion – Inventory is reserved when order lines are created, in the order in which the order lines are created. For BOMs, reservations are made for the individual elements of the BOM, not for the BOM item number.

1. Select whether to restrict access to the journal to certain user groups by using the Private for user group field.
   For example, you can set up individual journals to enable access to the following:

• Only warehouse workers who conduct physical counts
• Only users who document movements from the main warehouse to the vendor warehouse
• Users who document movements from the vendor warehouse to the main warehouse

Procedure: Set Up Journal Name as Default Value

When the journal names are created, they can be set up as default values for the journal type that is selected in the Inventory parameters form in the Journals section. To do this, follow these steps:

1. Open Inventory management > Setup > Inventory and warehouse management parameters > Journals.
2. In the appropriate field, select a journal name to be the default value when you create inventory journals of a certain type.

For example, when you create an Inventory adjustment journal type, the journal that is specified as the default journal name is proposed.

NOTE: If it is necessary, override this setting with any other journal name that is set up for the journal type.

After a journal is created and named, a journal line can only be accessed by one user at a time. It is useful to divide journals so that each posting routine is entered in its own unique inventory journal.

Example: Setting up Default Journal Names

If posting routines are associated with inventory transactions, a journal can be created for periodic inventory adjustments, and another for inventory counting.

In a situation where multiple departments of a manufacturing plant use the same inventory journal to enter shop supplies use, it helps create multiple journal names, for example, one for each department. In this manner, each department can open its journal for shop supply adjustments at the beginning of the day and leave it open for access throughout the day.

Inventory Dimensions and Inventory Journals

As with other types of receipts and issue transactions, the inventory dimensions must be specified for any transactions that are made in a journal line.

The ability to edit product dimensions for a journal line is determined by the product's dimension group setup.

Setting Up Inventory Dimensions to be Edited in Specific Journal Types

The inventory-related transactions for an item must specify the information that reflects the dimension groups that are assigned to the item, such as the basis for item identification (product dimensions), storage dimensions, and tracking dimensions. Therefore, you must create a dimension group and then add inventory dimensions as needed. The following are inventory dimension types:

• Product dimensions
• Storage dimensions
• Tracking dimensions

There are no set guidelines for selecting dimensions. However, we recommend that you use only the number of dimensions that will actually be used for each product. If some products are tracked and other products are not, create several dimension groups. Carefully consider how inventory should function before you set up inventory dimensions and dimension groups.

To set up inventory dimensions that can be edited in specific journal types, open Product information management > Setup > Dimension and variant groups > Product dimension groups.

Figure 8.2 PRODUCT DIMENSION GROUPS FORM

Procedure: Select Dimensions that are Displayed in Inventory Journals

To select dimensions that are displayed in inventory journals, follow these steps:

1. Open Inventory management > Setup > Inventory and warehouse parameters.
2. Click Inventory dimensions in the navigation pane, and then click the tracking dimension, for example, Batch number.
3. Select the journals in which Batch number is displayed, for example Movement or Transfer orders.

NOTE: These settings are only valid for the journal if you did not override the setting on the journal by saving selections in the Dimensions display dialog box. In this case, if Batch number is cleared, this setting overrides the setting that is specified in Inventory management > Setup > Inventory and warehouse parameters.

Posting

When you record inventory transactions. For example, in an inventory adjustment journal, you can generate the transactions for inventory profits and losses.

Use the Posting form to set up ledger account numbers for the automatic ledger transactions that are generated for receipt and for issue transactions in the inventory.

Set up account numbers as needed on one or more of the following tabs:

• Sales order
• Purchase order
• Inventory
• Production
• Standard cost variance

Each tab contains several account types, and for each account type, you must specify which account in your own chart of accounts that you want to use. If you have created an item group in the Item groups form with corresponding posting, that posting will automatically appear in the form, with the item group as a reference.

You can use either posting profiles or posting definitions to set up the account numbers for offset accounts. Each posting profile is associated with only one offset account. Posting definitions can be associated with multiple offset accounts.

Procedure: Set Up Inventory Posting

To set up inventory posting, follow these steps:

1. Open Inventory management> Setup > Posting > Posting > Inventory tab.
2. Select the posting type to be set up for the General ledger posting.

Figure 8.3 INVENTORY POSTING FOR INVENTORY JOURNALS

1. Create an inventory posting record by clicking New.
2. For each Main account type, specify which main account in the chart of accounts to use. Use the Item relation and the Item code fields to specify whether the account must be used for one of the following:

• A specific item – use to track, for example, the profit and loss, for a particular item.
• An item group – use to track, for example, issue or consumption for a particular item group. The item groups are set up in Inventory and warehouse management> Setup >Inventory> Item groups.
• All items