| Financial warehouses |  |
| Financial warehouses are used in various internal vendor managed inventory (VMI) scenarios, in which: The ownership of goods changes resulting from inventory transactions between departments or business units that belong to the same organization but have their own p & l accountability. Goods are not paid for on receipt, but at a later stage in the supply chain. A financial warehouse is used to specify the internal owner of the inventory. As a rule, the inventory of a warehouse is owned by the financial company to which the warehouse belongs. However, if the inventory is owned by another financial company, a financial warehouse is used to show that the inventory is stored in a warehouse belonging to financial company A but owned by financial company B. For this purpose, the financial warehouse is linked to the financial company of the business unit or department that owns the goods and to the warehouse actually storing the goods. In a financial warehouse, no physical transactions take place, it merely reflects the inventory levels of the physical warehouse (of the other financial company) where the goods are actually stored and handled. For further information on how a financial warehouse is linked to the financial company owning the inventory and to the warehouse storing the inventory, see Setup. For example, an organization has main office M and business unit B. Each is has its own p & l accountability. The inventory is stored in B's warehouse, but owned by M until B consumes the inventory. B has physical, that is "real", warehouse Wh_B. M has financial warehouse M_WhF. The goods are actually stored in Wh_B, and M_WhF reflects the inventory levels of Wh_B. In Wh_B, the inventory is shown as owned by M with ownership consigned. The ownership change is consumption based. In M_WhF, the goods are shown as own inventory. When goods are received in Wh_B, the inventory level is increased in both Wh_B and M_WhF. If goods are issued from Wh_B, B becomes the owner of the goods and consequently, the inventory level of Wh_B and M_WhF decreases. Because B has become the owner, he must pay for the goods. If a unit within an organization owns goods that are stored in several warehouses, each of which belonging to another business unit or department with its own p & l accountability, you can link the financial warehouse to the warehouses of each of these units. For more information, refer to Link financial warehouse to various physical warehouses. Because the main purpose of a financial warehouse is registering owned inventory actually stored in another department's physical warehouse, functionality and settings dealing with inbound movements, outbound movements, locations, and handling units is not required. For information on financial warehouse properties, see Financial warehouse properties. Setup Internal ownership registration is modeled as follows: Each department, such as a purchase office or business unit is defined as a department in ERP LN. Each ERP LN department is linked to an enterprise unit. Warehouses, financial or otherwise, are separate entities which are also linked to an enterprise unit. Internal business partners, also linked to an enterprise unit, represent the warehouses linked to the enterprise unit. Enterprise units are linked to financial companies. Financial transactions carried out for an enterprise unit are booked in the enterprise unit's financial company. To book financial transactions in the correct department's accounts, you must link the departments, internal business partners, and warehouses involved to the enterprise unit linked to the proper financial company. For example, internal business partner IBP_M is linked to enterprise unit EU_M, thus representing main office M (see previous example). Financial warehouse M_WhF is linked to EU_M and physical warehouse Wh_B (see below). EU_M. is linked to financial company A. Internal business partner IBP_B is linked to enterprise unit EU_B, thus representing business unit B. Warehouse Wh_B is linked to financial company B, which is also linked to enterprise unit EU_B. In this way, payments resulting from inventory consumptions by B are paid into financial company A and subtracted from financial company B. Link financial warehouse to various physical warehouses For example, an organization has a site in country ABC and one site in country BCD. Each site has one normal warehouse and two shop floor warehouses. Each site has its own p & l accountability. Therefore, in ERP LN, they are modeled as two separate financial companies. The organization also has a separate business unit, Business Unit 1, which owns inventory in both sites. Business Unit 1 can be a business unit in country ABC with its own p & l accountability, but it can also be a separate internal organization in another country, for example, the main office, which has inventory in country ABC on a pay on use or internal subcontracting scenario. Business Unit 1 is modeled in a third financial company. Thus two financial companies reside in country ABC and one in country BCD. See the following picture for the setup. Business Unit BU1 owns inventory that is stored in WH_1a. Because this inventory is owned by BU1 and not by the financial company ABC linked to warehouse WH_1a, a warehouse of type financial linked to financial company BU1_ABC is created. This warehouse, WH_BU1a, is linked to physical warehouse WH_1a (indicated in the picture by the arrow pointing from WH_BU1a to WH_1a). BU1 also has inventory in shop floor warehouses WH_1b and WH_1c. To specify the inventory of BU1 in these warehouses, no new warehouse need to be set up, but WH_BU1a can also be linked to these (physical) warehouses. Furthermore, in an internal pay on use scenario, BU1 owns inventory located in site 2 of the enterprise in country BCD. For this inventory, another warehouse of type financial WH_BU1b is created and this financial warehouse is linked to the physical warehouses in country BCD. The inventory owned by BU1 is stored in both the financial and the physical warehouse. In the physical warehouse, the inventory is stored as owned by the internal business partner of (the enterprise unit linked to the financial company of) BU 1. Financial warehouse properties For a financial warehouse, functionality and settings dealing with inbound movements, outbound movements, locations, and handling units is not available, nor are manual transactions such as receipts, shipping, inspections, or order entry. You cannot insert a financial warehouse on an order. If, for example, a parent warehouse is specified on a sales order, the financial warehouse is retrieved by means of the owning business partner. The inventory of a financial warehouse is not taken into account for planning and is not shown in non-financial inventory overviews, because it is also shown as the not-owned inventory of the physical warehouse linked to the financial warehouse. For each financial warehouse, overviews of all linked physical warehouses and overviews of inventory by item, ownership, and physical warehouse are available. In the Warehouses (whwmd2500m000) session, the following fields are read-only for financial warehouses. Of these fields, check boxes are cleared and list options have value Not Applicable: General tab All fields except: Address Extra Intrastat Info Warehouse Valuation Group Default Item Warehouse Status Process Inventory Variances Automatically Relation tab All fields except: Business Partner Locations tab All fields Lead Times tab All fields Handling Units tab All fields Handling Unit Labels tab All fields Dynamic Cross-docking tab All fields Direct Material Supply (DMS) tab All fields Shipments tab All fields |