Link inventory site to a financial dimension in AX 2012

The very first blog post I ever wrote, which was published on the 16th December 2011, was How to Add a Financial Dimension in AX 2012. (Incidentally the last screen-shot in that post is an oblique reference to SETI, and the photo is of another Tim, not me, but that’s got nothing to do with this post).

One of the odder things about Dynamics AX inventory accounting is the way that it seems to ignore warehouses. We often get asked to post inventory transaction costs with reference to the warehouse that is being received into or issued from – but unfortunately that’s not possible in standard Dynamics AX.

However it’s really simple to post inventory accounting transactions with a financial dimension that represents the inventory site (as opposed to the warehouse).

Before we walk through this process, lend me your ears for a few moments while I climb on my soap-box and say that in my opinion any inventory process which requires the user to enter or select a financial dimension is doomed to failure. Us mere mortals outside of the finance community should never be asked to fill in a financial dimensions when we create a purchase order, sales order, transfer order, production order, inventory journal, or any other inventory transaction. Everything that need to be posted into the general ledger has to default from the customer/vendor/item/resource or some other ‘real’ thing that relates to the inventory transaction. OK, I’m stepping off the soap-box now.

First we need to create a financial dimension (did I mention that I wrote a blog about that?). General ledger > Setup > Financial dimensions > Financial dimensions:

You’ll see in a few moments that part of the setup is to add the financial dimension value to be used to our inventory site setup – so you don’t have to use a one-to-one relationship between the financial dimension site and the inventory site. But I am a simple soul, not a finance consultant, so I’m going to setup my financial dimension values the same as my inventory sites. Save the new Financial dimension you’re creating and click on the ‘Financial dimension values’ button:


(stay with me, you’ll see where those values and descriptions came from in a moment).

Now add that financial dimension to our chart of accounts. General ledger > Setup > Chart of accounts > Configure account structures:


I’m editing the account structure defined by the Ledger parameter form. I’ve added the Site financial dimension selected ‘All values are allowed’ and clicked on the Filter icon and ticked ‘Allow blanks’. Then I activate the account structure. In this case I repeat the process with the Manufacturing P&L account structure, which in the demo data is a bit more complex:


Now let’s link the inventory site to the financial dimension site. Inventory management > Setup > Posting > Dimension link:


Firstly we select the Financial dimension (the Reference above). It’s a clever form – I’m only given the active financial dimensions in the drop-list:


Select your financial dimension (I’m using Site obviously) and then click on the Sites button. It takes you to Inventory management > Setup > Inventory breakdown > Sites, but notice now that the ‘Financial dimensions’ fast-tab is visible:


Obviously now I’m going to setup the link using the dimension values I created earlier (OK I confess. I got here, went back to there and then came back here):


That’s the basic setup of the link setup, obviously to activate the link we go back to the Dimension link form and click the button:


The system opens the job that updates existing open transactions (which also has its own menu option, Inventory management > Periodic > Linked dimension update):


OK gives:


Click ‘Lock link’ to prevent any updates of the financial dimension on the inventory forms, and (after the same update) you see:


Which is an interesting use of colour.

Now let’s go and see how that works in practice. I’ll create a quick purchase order and look at the purchase order line financial dimensions:


Production order:


Inventory adjustment journal line:


Couldn’t be simpler.

Just one thing to add. I felt a bit guilty when I said “inventory accounting … seems to ignore warehouses”. Of course we can define the warehouse storage dimension as relevant to financial inventory – and the system then tracks costs separately by warehouse. Product information management > Dimension groups > Storage dimension groups:


But somehow I feel that the system’s designed to track financial inventory by Site, and that flag on the Warehouse storage dimension is a hang-over from an earlier version.

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2 thoughts on “Link inventory site to a financial dimension in AX 2012

  1. “…in my opinion any inventory process which requires the user to enter or select a financial dimension is doomed to failure.” – This is the golden words! To anyone who implements the AX, you should print it out and hang on the wall

    Like

    • Rightly said. Still many people want inventory accounting based on different parameter, and they want that to be printed on BS or any financial statement. Subledger reporting are not great fit all the time.

      Like

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