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Change stock valuation after consignment stock fill up

Oct 11, 2017 at 08:28 PM


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Dear Finance experts,

My business scenario / processes are as below -

1. Issuing consignment stock to various dealers: We issue consignment stock in advance to dealers. We create invoice for consignment fill up wherein only INDIAN GST and basic custom duty are posting relevant in addition to freight and insurance.

2. The customer consignment stock now appears on customer name in same plant. Now, we need that valuation of the customer consignment stock must increase by an amount equal to (freight +insurance) for the material issued to the dealer. Please note that this amount will be different for different dealers as they are located across India. Even fir the same dealer, (freight+insurance) might differ for the same material due to increase or decrease in rates of freight and insurance. Dealer sells the material to end customer ,creates invoice and posts only revenues now as taxes and duties are already paid while issuing consignment stock. This order and invoice are also created in our system. (Ship to party = end customer and "End Sold to party" is other partner function for information purpose)

3. We do not want to use STO because we end up creating each dealer as a plant as well as a vendor resulting into thousands of dummy plants and we have to extend all materials to all these dummy plants etc. Onboarding a new dealer also becomes a big headache and also results into an inefficient and tedious solution.

How can we make this happen? Possibly, we may post (freight + insurance) into a provisional GL account and later post it to the inventory GL. This may help in ensuring that FBL3N report will display the updated stock value without changing standard price in material master record. Will such approach ensure valuation of same material specific to a dealer holding customer consignment stock? Please help.

Thanks and best regards


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