Change Of Costing Method

Dear All, I have a site up on Navision version 3.10. I have already closed one year there. Now in the new fiscal year they want to change their costing method of items from Average to FIFO. Could any body suggest me how to go about it and what are the issues involved. Thanks in advance.

If you do a search on Change Costing Method you will find three pages of topics…A few of those might be helpful to you. Good Luck.

We have done some work in this area, but unless you fully understand all the concepts of inventory costing (ie have attended the official Navision course), I would be very careful of attempting this. There are some documented steps to clear out the stock (not just a matter of getting the stock back to zero), plus you must run the periodic activities, prior to bringing the stock back in. if you don’t follow the steps properly, then you will encounter some strange values in your Inventory Valuation reports. The preferred option would be to create new items with the new costing method, but I understand that is not always practical to do so.

We did this, but on 2.6. There was very little impact with the exception of the accounting period the change was made. You (obviously) should expect a valuation difference in the g/l versus the inventory value report. My suggestion would be to calculate what the change should be so you can verify the difference. We did use outside consulting on this…I would not attempt on my own.

The underlying table structure is far more complex in Attain version 3 onwards. There are many ledgers relating to items , specifically the Item Ledger entries and the Value entry tables. There are also many different types of transactions written to these tables, eg the Periodic activities for Adjust and Post costs to the GL, will create value entries with a type of ‘rounding’ in some instances. What worked on version 2.6, will not necessarily work on version 3. It requires a far more detailed understanding of the inventory ledgers which is why Navision have introduced an Inventory Costing course from version 3.60 onwards to explain this in detail. It is a one day course.

The biggest issue you will have comparing 2.60 to 3.70, is the way average cost is calculated. 2.60 basically has a running counter that keeps track of the current average cost, and up dates this. In 3.70 the value is calculated new each time. This means that if you do a revaluation on 2.60, it is very likely that you will have problems with the historical average cost. If you are moving from average to fifo, then the problem will probably not be noticable. btw if you are planning this, then set the adjusted flag to false on the ledgers, andrerun the adjustmet routine, it will normally sort it all out. As an fyi, I have often changed costing methods, and if you follows Margie’s advice, you should go fine.

Hi David Sir,

I know you are the NAV High Profile person and use to give lof of solutions against the Complex problems.

I am in a dilema to have the solution regarding the changing the Costing method of almost 20K+ items.

I request you please share your experience which use to follow to change the costing method like you mentioned above .

Thanks in Advance.

Hi David Sir,

Could you share your experience ?

Thanks in Advance

I sent you a PM.