System Setup

System Setup

HelpID: 519722040

Navigation: Tools >> Setup >> Inventory >> Lean MFG Setup

The System Setup window is used to provide default values for LeanMFG. When creating MO Document Types, each Document Type can override the defaults (such as using a different WIP Account). If a Document Type does not provide a value for one of these setup options, LeanMFG will use the default provided in the System Setup window.

The window has five tabs, which are selected by clicking on the “tabs” at the top of the window:

Dynamics GP must be restarted to enable (or disable) any of these settings.

Accounts

WIP Account: All manufacturing costs will wash through this account. The cost of the “inputs” when adjusted OUT of inventory will go into the WIP account. When the “outputs” are produced the costs will be pulled out of the WIP account.

Normally this account will have no balance. If a Manufacturing Order has been partially posted the WIP account will hold the cost of the Inputs and non-inventory expenses. The LeanMFG posting process is normally a 1-step process where the inputs are consumed and the finished good(s) produced. It is usually an error condition that would result in a partially posted MO. Once the error has been resolved, posting will complete and clear the WIP account.

This should be a Balance Sheet account with a Debit balance.

Non-Inventory Offset Account: Normally this account will come from the Inventory Offset Account on a Service/Misc. Charges/Flat Fee item, but if the item does not have an Offset Account specified this default account is used.

Non-inventory expenses, such as labor or overhead, are added to the BOM as inventory items with the Item Type of Service, Misc. Charges, or Flat Fee. When the non-inventory item is “consumed” the value should hit an applied labor account. When setting up labor items, the Inventory Offset Account should be an Applied Labor account. In the event an Item is missing the Offset Account, the default Non-Inventory Offset Account will be used.

The Applied Labor Account should be a Balance Sheet account with a Debit balance.

Variance Account: In the event all Input costs cannot be fully allocated to the Output(s), the remaining amount will be posted as Variance.

This account should be a P&L Account with a Credit balance.

Default Inventory Account: Lean MFG will use the default Inventory Control account specified on Posting Accounts Setup if an Inventory Item (Sales Inventory type) does not have an Inventory Account. See Setup >> Posting >> Posting Accounts.

Options

Allow MFG with {BOM Status} BOM Checkboxes

A LeanMFG Bill of Materials can have one of several different statuses. These checkboxes control whether or not a BOM of a particular status can be used to create an MO. For example, Design and Preliminary BOMs may be left unmarked as you use them only for engineering or other planning purposes. If a BOM Status is not allowed (i.e. it is not-marked), you will not be able to use that BOM to create an MO).

Allow Use of {Material Status} Inventory Checkboxes

These settings refer to the Material Status setting and Effective Date for an item specified on the LeanMFG Item Engineering window (shown below).

For example, you might want to prevent use of inventory in LeanMFG that has a Material Status of DESIGN.

These settings apply to the use of inventory in the LeanMFG Manufacturing Order window.

Copy BOM Note to MO Note

When enabled and a new MO is created or the BOMID is changed, if the BOM has a Note it will be copied to the MO Note.

Control Item Use in {GP Module} Checkboxes

Enabling these controls applies several checks on an Item to see if it allowed on the given transaction. For example, by enabling the control in SOP you can prevent sales of inventory where the Material Status is DESIGN.

Use the “Control Item Use” options can be applied to the transactions in these modules:

  • Sales Order Processing (SOP): Sales Transaction Entry
  • Purchase Order Processing (POP): Purchase Order Entry
  • Inventory (INV): Item Transaction Entry

When enabled, the following checks are performed when an Item Number is entered into one of the transaction entry windows:

  • Does the Item exist in the Item Master? If not, the Item is rejected. For SOP and POP this means that non-inventory Items are not allowed.
  • Is “Allow use of Discontinued Inventory” unmarked? If so, is the Item Master “Item Type” = Discontinued? If so, the Item is rejected.
  • Does the Item have an Item Engineering record? If not, the Item is rejected.
  • Is there a Date in the Effective Date field? If so, is the “Allow use of Inventory before Effective Date” option unmarked? If so, is the Effective Date in the future compared to the User Date? If so, the Item is rejected.
  • Is the Item Engineering Material Status = 0 (which means it has not been set)? If so, the Item is rejected.
  • Is the “Allow use of {material status} Status Inventory” box unmarked? For example, if the Item Engineering Material Status is “Design”, is the “Allow use of Design Status Inventory” box unmarked? If so, the Item is rejected.

The “Control Item Use” checkboxes work together with the “Allow Use of” checkboxes. If “Allow use of Preliminary Status Inventory” is unmarked (meaning use of Preliminary Status inventory is not allowed), and “Control Item use in SOP” is marked, you will not be able to use an Item in Sales Order Processing if its Item Engineering material status is Preliminary.

Enabling these controls will prevent use of an Item Number if the Item Engineering Material Status is not allowed, or if the Effective Date is in the future.

Create MO Routing: When an MO is created, and the Picklist is built, LeanMFG can create a “snapshot” of the Item’s Master Routing and attach that to the MO. The MO Routing is a separate Routing record that can be changed without affecting the Master Routing.

Default to Primary BOM on new MOs: if a Bill of Materials is marked as Primary, that BOM ID will default when creating a new MO. If this option is unmarked you will need to manually select the BOM ID when creating an MO.

Document Date: Set to User Date when posting: if not marked the Document Date gets set to the User Date when the document is created.

Document Date: Lock Field: disables the Document Date field in the MO Entry window.

Disassembly Wizard: Remove Non-IV Items: This option should ONLY be enabled on a Reverse or Disassembly MO Document Type. When the Disassembly Wizard is used to create a Disassembly MO, enabling this option will cause the Wizard to create a picklist (Inputs) that includes only “Sales Inventory” type items. Services, Misc Charges, and Flat Fee items will NOT be added to the Inputs.

Disassembly Wizard: Reverse Non-IV Costs: This option should ONLY be enabled on a Reverse or Disassembly MO Document Type. When the Disassembly Wizard is used to create a Disassembly MO, any non-inventory type Items (such as Services or Flat Fees) will be added to the Outputs tab. Posting will create a Journal Entry that reverses the debits and credits of the original MO. DO NOT enable both Reverse Non-IV Costs and Remove Non-IV Items. The Remove Non-IV Items option is checked first, so if it is marked the items will NOT be included on the Disassembly MO.

Display Unit Cost Warning: see the chapter Split Cost Layer for more information. Enabling this option will display a warning during MO Posting if the Output(s) will create a split cost layer.

GL Post Date: Set to User Date when posting: if not marked the GL Post Date gets set to the User Date when the document is created.

GL Post Date: Lock Field: disables the GL Posting Date in the MO Entry window.

MPP Add Item: Combine same component quantities: this option can be marked on all MO Document Types but is only effective on Multi-Product Manufacturing Orders. For MPP, if the Add Output window is used and this option is marked (to combine same component quantities), “Input” item quantities for the same item will be combined if the Item, Site and Unit of Measure match.

Order Date: Set to User Date on New MO: if not marked the Order Date is empty (the Document Date is set to the User Date).

Order Date: Lock Field: disables the Order Date in the MO Entry window.

Print Options: When posting an MO, several different posting journals may print depending on the requirements of the MO:

  • Inventory Transaction Journal for the inventory adjustment removing “inputs”
  • Transaction GL Register for the inputs adjustment posting through GL
  • Cost Variance Journal for the inputs adjustment
  • Inventory Transaction Journal for the adjustment adding “outputs”
  • Transaction GL Register for the outputs adjustment posting through GL
  • Cost Variance Journal for the outputs adjustment
  • Non-Inventory Costs GL Journal (a journal entry is created for non-inventory Items such as those used to add Labor or Overhead costs)
  • Variance GL Journal (a journal entry is created when the input costs do not equal to standard cost of the output item)
  • Mfg Order – Costed: shows the cost of input materials and service-type items, cost of output(s), and any difference (variance) between the two. This will print when posting is complete. If Input costs are not fully allocated to Outputs you will be given an option to abort posting and print the Mfg Order-Costed report.

The print options control which of these will print. Some, all, or none may be selected.

Require Approved Vendor: if marked, an Item must be approved for purchase from specific Vendors. See Item Engineering. Approved Vendors are maintained on the Item Engineering window. The Required Approved Vendor setting is only visible in the System Setup window (it does not appear in the MO Document Type Details window).

Serial/Lot – Require Linking: if this is marked, to post an MO you must link ALL input serial/lots to output serial/lots. If this is unmarked, completing serial/lot linking will be optional, and you will be able to post an MO with no serial/lot linking or with partial serial/lot linking. Serial-lot linking ties specific “input” item serial or lot numbers to specific “output” item serial or lot numbers. It provides an unambiguous connection between a finished good and the material used to produce it.

Serial/Lot – Track Linked Quantity: if marked, the system will track the component quantities as they are linked to finished items, so that if 2 out of 10 have been linked, it will only allow linking another 8.

If there is a clear, discrete relationship between the unit produced and the components put into it, this option should be marked.

However, if two lots of a raw material may be used in a process that produces one or more lots of finished-good, and you need to link the lot numbers together for traceability, it might be impossible to specify exactly how much of each lot made its way into the finished-good. If this option is unmarked, the component quantity field can be left at zero, and the Serial-Lot Link window will simply record a link between the serial/lot numbers, but not record a quantity.

Site-Segment Override options:

If GP is set up to use a “Site Segment”, transactions that use inventory will swap the “Site Segment” of the item’s Inventory Account for the Site Segment specified on the transaction’s Site.

The Segment ID for Sites is specified on the Inventory Control Setup window (Tools >> Setup >> Inventory >> Inventory Control).

A Site Segment can then be assigned to each Site:

If an item’s Inventory Account is 000-1300-01, when a transaction uses site WAREHOUSE it will change the account to 400-1300-01 (if the 400-1300-01 account exists).

The Site Segment Override options add this same functionality to the non-Sales Inventory items that could be used on a Bill of Materials (Misc Charge, Flat Fee and Service). You may choose to override the Site Segment for these items to help track labor costs to a particular department. For example, all production occurring in the NORTH site could use Site Segment 300, which would change the Labor Item’s Inventory Account to a site-specific labor account.

Require Swap Account: when marked (the default) the MO Entry window will require that the GL account resulting from the seqment swap exists, if not an error report will print stating that the account does not exist. If this is unmarked, the swap account will be used if it exists otherwise LeanMFG will use the default account.

Numeric

Allowable Variance: the LeanMFG posting process occurs in two steps. First, the “inputs” are posted. The system gets the costs from the posted inventory adjustment, and if present, the labor and overhead journal entry. All of these “input” costs go into the WIP Account. These costs are then allocated to the “outputs”. Sometimes the costs cannot be completely allocated to the outputs, which results in a variance. If Allowable Variance is zero, you will always be presented with a dialog box informing you of the status of the allocation process.

For example: “Costs were fully allocated, do you want to review before posting?” This window will appear even if there is no variance.

If you specify an Allowable Variance, you will only see the “review” message if the variance exceeds the specified amount. This will also keep the window from appearing when the variance is zero.

BOM Line Spacing: increment for the spacing between BOM line numbers. If no number is entered LeanMFG will use a spacing of 10.

Routing Op Spacing: increment for the spacing between Routing Operations. If no number is entered, LeanMFG will use a spacing of 10.

Lot Copy Suffix Pad: when the Lot Copy functionality is used it can generate “serialized” Lot Numbers. With serialized Lot Numbers a unique Lot Number is generated for each unit of an item. This allows attaching attributes to each individual unit. When the Lot Copy utility generates Output Item Lot Numbers from an Input Item Lot (or Serial) Number, a user-entered Lot Suffix field will be manually entered. The Lot Copy Suffix Pad adds leading zeros to the Suffix. A Pad of 3 will change “1” into “001”.

Strings

Draw From Site: specify a default location from which to pull “inputs” for a Manufacturing Order. The site can be changed when creating the MO.

Post To Site: specify a default location into which the made items should be posted. The site can be changed when creating the MO.

Source Document: create a GL Source Document code. This code will appear on the Journal Entries used to post non-inventory expenses, such as Labor.

Shortage

Component Shortage: this setting reflects setup in the Inventory Module regarding allowing Adjustment Overrides. If Inventory Setup allows Adjustment Overrides, when a new MO is created and there are shortages of one or more components, the Picklist will be built with the required quantities and shortages will be overridden.

If Inventory Setup does not allow Adjustment Overrides, the Component Shortage option will be set to “Do not build picklist”. In this case you will receive a warning about the shortages, and the Picklist will not be built.

Alternate Option: this setting will be used by a future release of LeanMFG to support using Alternate Items when there is a shortage of the Primary Item.

Requirements

LeanMFG requires that:

  1. General Ledger is registered
  2. Inventory is registered
  3. Posting Setup for Inventory Adjustments allows posting TO and THROUGH General Ledger

For Posting Setup see: Microsoft Dynamics GP >> Tools >> Setup >> Posting >> Posting:

Functional Currency Decimal Places

This section addresses a special case where Multi-Currency is not enabled.

When Multi-Currency is not enabled, the Currency Decimal Places on an Item can be set to a different value than the Functional Currency Decimal Places (FCDP). For example, the FCDP could be 2, but an Item could have 3 currency decimals.

In this setup, an Item could have a cost of $1.124 but the GL tracks costs only to second decimal.

Since the GL operates using the FCDP, it is impossible for GP to store the value of $1.124 in the Inventory GL Account, so it rounds the value to $1.12. This means the value stored in the inventory module ($1.124) will not match to the GL ($1.12). The difference can become significant when manufacturing consumes or produces a very large quantity of inventory with costs that cannot be posted to the GL.

WilloWare strongly recommends that you set your FCDP to match the large number of currency decimals.