To perform a yearly physical inventory within Dynamics 365 Business Central the tasks to complete are as follows:
1. Calculate the expected inventory.
2. Print the report to use when counting the inventory.
3. Enter and post the actual counted inventory.
If your location that you are counting is not using directed pick and put-away, then you must use the Physical Inventory journal and the procedure is the same as conducting a physical inventory without cycle counting.
To calculate the expected inventory in basic warehousing configuration:
1. Search for ‘Physical Inventory Journals’ within your Dynamics 365 Business Central search bar.
2. Run the calculate inventory function on the ribbon by navigating to Actions – Functions – Calculate Inventory.
3. On the Calculate Inventory request page, set the filters and conditions such as whether to include items with zero inventory or items not on inventory as shown below.
The item entries are processed based on the information specified. The Qty. (Physical Inventory) field is automatically populated with the same quantity as the Qty. (Calculated) field. However, if the count in the warehouse is different then the calculated quantity in Business Central, you must overwrite the Qty. (Physical Inventory) field with what was counted.
4. The journal and suggested item entries are populated in the physical inventory journal as shown below.
The user can calculate inventory for certain items, bins, locations, and dimensions.
To print the report for counting:
1. In the Physical Inventory journal, choose the Print action on the ribbon.
2. In the Physical Inventory List page specify if the report should show the calculated quantity and if the report should list inventory items by serial/lot numbers.
3. Employees are now able to count inventory to record discrepancies on the printout of the report.
Entering and posting the actual counted inventory in basic warehouse configurations:
1. In the Physical Inventory journal page, where the actual inventory on hand as determined by the physical count differing from the calculated quantity, enter the actual inventory on hand in the Qty. (Physical Inventory) fields.
- If the physical count reveals differenced with incorrect item location codes, do not enter the differences in the physical inventory journal. Use the reclassification journal or a transfer order to redirect the items to the proper locations.
2. Post the journal.
- Both item ledger entries and physical inventory ledger entries are created.
Item Ledger Entries:
Physical Inventory Ledger Entries:
To calculate the expected inventory in advanced warehouse configurations:
1. Search for ‘Item Journal’ in Business Central.
2. Run the Calculate Warehouse Adjustment function by navigating to Actions – Functions – Calculate Warehouse Adjustment.
3. Populate the batch job request page with the item numbers you want to count along with the location.
4. Click the Ok button and post any necessary adjustments. (If you don’t perform steps 1-3 then the results posted to the physical inventory journal and item ledger in the second part of the process will be the combined physical inventory and other warehouse adjustments for item that were counted).
5. Search for Whse. Physical Invt. Journal in Business Central.
6. Run the Calculate Inventory function.
7. Set the appropriate filter on the request page.
8. Go to the Whse. Physical Inventory List report page and print the list of which warehouses and items to count in each bin.
9. When counting is completed, enter the quantities in the Qty. (Physical Inventory) field in the warehouse physical inventory journal.
10. When everything has been entered choose the Register action.
- When a journal is registered Business Central creates two warehouse entries in the warehouse register for each line.
- If the calculated and physical quantities differ, a negative or positive quantity is registered for the bin and a balancing quantity is posted to the adjustment bin for that location.
- If the calculated and physical quantities are the same, Business Central registered a 0 entry in both the bin and the adjustment bin.
To setup counting periods:
1. Search for Physical Invt. Counting Periods.
2. Fill in and setup your counting periods with a frequency.
To assign a counting period to an item:
1. Search for Items.
2. Select the item that you want to assign a counting period for.
3. In the Phys Invt Counting Period Code field choose the appropriate counting period.
4. Choose the Yes action to change the code and calculate the first counting period for the item. The next time you perform a cycle count with this item it will appear as a line on the Physical Invt. Item Selection page.
To initiate a count based on counting periods in basic warehouse configurations:
1. Search for Physical Inventory Journal.
2. Choose the Calculate Counting Period action.
- The Physical Invt. Item Selection page opens showing the items that have counting periods and need to be counted according to those counting periods.
3. Perform the physical inventory based off the counting period items.
To initiate a count with counting periods in advanced warehouse configurations:
1. Search for the Whse. Physical Invt. Journal.
2. Select the Calculate Counting Period option.
3. Perform the physical inventory detailed in the previous sections.
To adjust the inventory of one item:
1. Search for items in the global search.
2. Select the item you want to adjust inventory for and select the Adjust Inventory function.
3. In the New Inventory field on the request page enter the inventory quantity you wish to record for the item.
The items inventory is adjusted and the new quantity is shown in the Current Inventory field on the adjust inventory page and the Inventory field on the item card.
To adjust the inventory quantity of multiple items in basic warehouse configurations:
1. Search for item journal.
2. Fill in the necessary fields to adjust.
3. Post the journal.
To adjust bin quantities in advanced warehouse configurations:
1. Search for the Whse. Item Journal (must be setup as a warehouse employee to use advanced warehousing functions!).
2. Fill in the header information.
3. Populate the item no. field on the line.
4. Enter the bin where you are putting the extra items, or you have found items to be missing.
5. Fill in the Quantity field with a positive quantity if you found extra items or a negative quantity if missing items are discovered.
6. Register the journal.
To synchronize the adjusted warehouse entries with the related item ledger entries:
1. Search for item journal.
2. Select the Calculate Whse. Adjustment action and fill in the necessary fields in the batch job request page. Adjustments are only calculated for entries in the adjustment bin that meet filter requirements.
3. On the Options fast tab enter the Document No. field with a number that is manually entered.
4. Click Ok.
5. Post the journal lines to enter the quantity differences in the item ledger. The inventory in the warehouse bins now aligns to the inventory in the item ledger.
To reclassify an item’s lot number:
1. Search for Item Reclass. Journals.
2. On the page fill in the fields as necessary.
3. In the location code field enter the item’s current location code.
4. In the New Location code field enter the item’s new location code.
5. Post the journal.
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