A Negative Tier Report identifies over-distribution tiers that need to be resolved for items valued at LIFO, FIFO, Lot or Serial. Over-distribution tiers result from processing sales or issues prior to processing receipts. These tiers should be reconciled prior to Period-End Processing, as their existence can cause unexpected results in Period-End reporting. The existence of over-distribution tiers can also result in incorrect costs being assigned to sales or issue transactions. Follow the below steps on how to correct your negative tiers.
Finding the Negative Tiers
- Run the Inventory Negative Tier Report to review the negative tiers.
It can be run for LIFO/FIFO or LOT/ SERIAL valuation. You can also select a product line or warehouse.
If you leave the default settings it will produce a report that looks like this:
When reviewing the 1st line item in item maintenance this is what it shows on the cost detail tab.
The 1st line shows the ovedistribution in red that causes the negative tier. This usally occurs when an item is shipped/invoiced before it has been received. Or it could happen if you had a quantity in another warehouse that needed to be transferred to this warehouse and wasn’t.
Correcting the Negative Tiers
Run the Negative Tier Adjustment
- Open Inventory Management > Period End > Inventory Negative Tier Adjustment > Preview > Review > Print > Close Report and say "yes" to update.
This goes out to inventory and checks to see if there are any tiers available to take the negative quantity from to clear the negative tier. If there is a tier with a quantity equal to or greater than the negative tier when you run the Inventory Negative Tier Report again it will be gone.
If there is not a tier available to cover the negative it will remain on the report.
- Open Inventory Management > Period End > Inventory Negative Tier Report
- Click the "Valuation to Print" boxes LIFO /FIFO tiers or Lot /Serial. For Lot/Serial valuation methods, this selection is for reporting only. See step number 8 below.
- Select the desired Warehouse code.
- Click "Print" the Negative Tier Report.
For the items with negative tiers that remain on the report you will need to perform transactions either transferring from one warehouse to another or receipting the goods to cover the negative quantity.
- Open Inventory Management > Main > Inventory Transaction Entry and enter the necessary transactions to transfer or adjust the quantity in the warehouse to create a positive tier if needed.
- In Transaction Entry, Select Transaction Type
- Next, Entry Number.
- Verify the Date to be used.
- Warehouse.
- Next, Entry Number.
- Verify the Transaction Date.
- Comment if wanted.
- Go to the "Lines" Tab.
- Type the Item Code to be adjusted and a Positive Quantity in the Quantity (if your tier has a -1 quantity on the report, type in a 1 for the quantity in this Quantity field) You may have to distribute the item to the overdist tier.
- Print and Post. The item will no longer be on the Negative Tier Report.
- Repeat until finished.
- For Lot/Serial tiers, an Inventory Transaction Entry is needed to pull the quantity from the appropriate Lot/Serial number and add it to the negative Lot/Serial The Inventory Negative Tier Adjustment cannot determine the correct tier that should have been used.
- For FIFO/LIFO tiers, Open Inventory Management > Period End > Inventory Negative Tier Adjustment to clear the negative tiers for FIFO/LIFO items.
- Run the Inventory Negative Tier Report again to verify that no negative tiers remain.
Note: The Inventory Negative Tier Adjustment uses the Module Date to find the Transaction Date of offsetting positive tiers.
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