In D365 Finance and Operations, managing transfer orders is a crucial aspect of maintaining efficient inventory operations. However, there may be instances where you need to cancel a transfer order shipment due to various reasons such as changes in demand, inventory discrepancies, or operational adjustments. In such cases, it is essential to understand the process of cancelling the transfer order shipment to ensure accurate inventory management and smooth operations. Here are the steps to cancel the transfer order shipment in D365 Finance and Operations: Go to Inventory Management>Out Bound Orders>Transfer Order. Here, I have already created the Transfer Order which is in Created State. Here, I am transferring the Items from (Warehouse W1 to Warehouse W2). The next step is to ship the Transfer Order. In the below screenshot you can see that the Transfer Order has been Shipped. As the Transfer Order is shipped the following Transactions are posted. Now to Cancel the Transfer Order Shipment. In the Transfer Order tab click on Transfer Order History which is under the View Action tab. Here you can see the Transfer Order Shipment. Select that and then click on the Cancel Button from the top of the screen. By clicking this the system will automatically reverse the Transaction. You will see that a Reverse entry is posted with negative quantity and there will be a right tick under the Cancelled Shipment column. Now if I go to Transactions, I can see that the entry has been reversed and the Transfer Order status has been reverted back to Created. Note: The Transfer Order which has been received cannot be Reversed by this process. Transfer Orders which are only in Shipped state or transfer orders where in Shipment has been sent can only be cancelled or Reversed. Depending on your system configuration you may need to manually adjust the Inventory. That’s it for this blog! Hope that helps, thank you for reading!!

In Dynamics 365 Finance and Operations (D365 F&O), the use of batch numbers is a common practice to manage and trace items with specific characteristics. Batch numbers are typically assigned to groups of items produced or received together, allowing for better control, tracking, and compliance with industry regulations. In this blog I will explain how to solve the expiration date issue while registering a Batch and Serial number tracked product. In the above screenshot you can see that the Batch Number 23010-CM-000088 has been assigned for my Item P-000014. Here, the Expiration Date is 08-04-2023. Now if I try to register this Item with the same Batch Number, I will get the Batch Number Expiration Date being past the Required Date error. Now to solve this error go to Inventory Management>Enquiries and Reports>Tracking Dimensions>Batches. Now on the Batch Number page go to Reset Tab then under the Reset tab click on Reset Shelf-Life Dates. The next step is to select the New Expiration Date and then Click Ok. This will Update the Expiiration Date of that Batch Number. In the above screenshot you can see that the Expiration Date has been changed. Now we will be able to register the Item. Here, you can see that now I am able to register the Item successfully. That’s it for this blog. Hope this helps you! Thank You!

Hello Everyone!!! In this blog I will explain the Quarantine Management process in Dynamics 365 Supply Chain Management.  Here the Product was first received in the Main warehouse and then it was moved to Quarantine Warehouse for further inspection as the Product failed to clear the Quality Test. In this blog I will explain a scenario where the Products should be directly received in the Quarantine Warehouse for inspection and after final inspection it turns out that all the products fail the inspection so, a few products will be scrapped and the rest will be returned back to vendor. What is Quarantine Management? The quarantine management process in D365 aims to effectively manage and control quality issues, ensuring that only items meeting the required standards are released for use or distribution. The quarantine management process in Dynamics 365 is a systematic approach to handling items that are suspected of having quality issues or non-conformities. When an item is flagged for quarantine, it is physically segregated from the regular inventory and moved to a designated quarantine location. The quarantined item undergoes thorough inspection and testing to assess the extent of the quality issue. Based on the evaluation, decisions are made regarding the item’s disposition, which may include repair, return to the vendor, or scrapping. If the item is repairable, necessary actions are taken to rectify the identified issues. In cases where the vendor is responsible, the item can be returned for resolution. Once the necessary actions are completed, and the item meets the required quality standards, it is released from quarantine and reintegrated into the regular inventory for use or distribution. This process ensures that only items meeting quality criteria are allowed for further processing, while mitigating the risk of non-conforming products entering the supply chain Let’s start with the setups first: Step 1: Map the Quarantine Warehouse to the Main Warehouse. For that the Pathway is: Go to Inventory Management>Set Up>Inventory Breakdown>Warehouses. Step 2: The next step is to Enable the “Quarantine Management” parameter in the Item Model Group Quarantine Management Process: The below Purchase Order CM-PO-0000137 has been received in the Quarantine Warehouse as per the setup, hence a Quarantine Order CM-0000142 with 9 quantities has been created. Now if I go to the Quarantine Orders page, I can see that a new Quarantine Order has been created. The below screenshot shows the Transactions that took place after the Product Receipt was posted. After Inspection it was found out that 5 quantities were damaged, 4 quantities were to be returned back to the Vendor which means that all the 9 quantities failed to pass the Quality Inspection. So, what I will do is Scrap the 5 quantities and return back the 4 quantities to the Vendor by creating a Purchase Return Order.  Now I will split the Quarantine Order CM-0000142 into 2 separate Quarantine Orders. For that I will use the Split function which is available at the Top of the screen under the Functions Tab. In the above image you can see that I have split the Quarantine Order CM-0000142 into 2 different Quarantine Orders that is CM-0000143 and CM-0000144 for further processing. Now let’s begin the further processing. To scrap this order, I will use the Scrap functionality. To Scrap this order, click on Function and then select Scrap. Here, you can see that the Quarantine Order CM-000143 has been ended as it has been scrapped. 2.  Return the Items back to vendor: Now in order to return the Items back to vendor I will first the Invoice the existing Purchase Order which is CM-PO-0000137. Then I will receive the Items from the Quarantine warehouse to the W3 warehouse. Below you can see that I have invoiced the purchase order CM-PO-0000137. Now let’s receive the items from the Quarantine Warehouse to the Central Warehouse, for that I will use the Arrival Journal. As you can see that a New Arrival Journal has been created. Validate and Post the Journal. Vendor Return Process: After posting the Journal create a New Purchase Order with the type as Return Order.  For that go to Procurement and Sourcing>Purchase Orders>All Purchase Orders. Then select the Vendor to whom the Items will be returned and select the Purchase Type as Return Order. Enter the Site and Warehouse from which the Items will be returned back to the Vendor. Then enter the RMA number provided by the Vendor and then Click OK. Click on the Purchase Order line, select Credit Note, choose the specific invoice, input the quantity as a negative value, and then click OK. In my case the Invoice Number was 311711, so I will select that and then click OK. Then proceed with the normal purchase order processing which will be Product Receipt and Invoicing. After Invoicing the Return Order aa credit note will be  created which will be  deducted from the Vendor Balance. The below screenshot represents the On hand List before and after posting the Return Order Invoice. In the above screenshot you can see that the On hand Quantity changed from 26 to 22 since 4 quantities have been returned back to vendor. That’s it for this blog. Hope this helps you! Thank You!

Introduction In my previous blog, I explained the required Quality Management setups. In this blog, I will execute the Quality Management process with two scenarios; in the first scenario the Products passes all the Quality Control process, and in the second scenario will be where the Products fail a Quality Control Process. To address the Second scenario, two products will be selected, specifically Brake Pads from two distinct manufacturers. All the setups that I showed in my previous blog will remain the same. To execute the second scenario, I will take two products from two different manufacturers. And an additional Item Sampling has been created for the second product. Execution: (Scenario 1) As all the necessary setups are completed let’s test this by creating a Purchase Order for quantity 10. As per the Quality Association setup the Quality Order has been created after product receipt generation. So now until the Product passes the Quality Test, the Purchase order cannot be Invoiced since the Event Block is set to Invoice. Here the Quality Order is generated for 5 qty since the Item Sampling is 50% so the entire 5 qty needs to pass the Quality Test as the acceptable level is 100. Select the Test and then click on Results to fill in the Test Results for the Product: Brake Pads. In the Results Page, in the Results Quantity enter the Quantity which passed the quality test. Then select the Outcome and you can see a right tick in the Test Result column which means that the product has passed that particular Quality Test. Repeat this process for all the Tests. The Next step is to validate the Quality Order. For that click on Validate from the top of the screen. Here I have disabled the Quarantine upon Validation failure because my product has passed all the Quality Tests so there is no need to enable that parameter unless it fails the Quality Tests. Now since my Product has passed the quality order, I will now be able to generate the Purchase Order Invoice.   Notice how the Quality Order status changes from “Open Quality Order” to “Closed Quality Order”. Scenario 2 As I explained at the beginning of my blog, in this scenario, I will take two products from two different manufacturers (P-000017 and P-000018) and one of them fails the Quality Tests. The products that failed to pass the Quality Order will be transferred to the Quarantine Warehouse for further processing. The Quality Association has been set up for both the Products. For Product P-000017 the Item Sampling is set to 50% and the AQL is set to 100 and for Product P-000018 the Item Sampling is set to 100% with Full Blocking Parameter enabled. Quality Order Processing As per the Tests defined for both Items, the product P-000017 has failed the test as the acceptable quantity defined is 100 for all the tests. And for the other Product that is P-000018 has passed all the Quality Order tests. Refer below screenshot to view the failed Tests of product P-000017. In the above screenshot, you can see that only 1 quantity of product P-000017 has passed the test and the other 2 quantity has failed to pass that particular quality test which ultimately leads to Quality Order failure. Same is the case with the other two tests as well, which clearly state that Product P-000017 has failed the Quality Order process. Now you can see that Product P-000017 has failed the Quality Order process so it is necessary to move this stock to a different location where it will be further inspected. This process of segregating stock is referred to as Quarantine. Quarantine Management Quarantine management in Dynamics 365 Finance and Operations refers to the process of isolating and controlling items that are suspected of having quality issues or non-conformities. The quarantine management system helps track and manage these items, allowing for proper inspection, testing, and disposition decisions. It ensures that only items meeting quality standards are released for further use or shipment, while those in quarantine undergo necessary actions, such as testing, repair, or disposal, to address any identified issues. A new separate Warehouse should be created in the system to transfer the products that fail the Quality Order process. This warehouse is called a Quarantine Warehouse. Attach this warehouse with a warehouse that you are going to use for transactions under the Quarantine Warehouse drop-down option. Quarantine Process As the Product P-000017 has failed the test it needs to be transferred to the Quarantine Warehouse. To do that click on Validate from the top of the screen and then enable the Quarantine upon Validation Failure parameter and then click on OK. In the below screenshot, you can see that as I clicked on OK, the System automatically generated a Quarantine Order. Now if you go to that released product and click on Transactions under the Manage Inventory Fast Tab you can see that the Product P-000017 has been deducted from W1 and has been received in the Quarantine Warehouse. Depending on the product type and inspection results, an item can be repaired to make it acceptable or returned to the vendor if it is deemed unfit for use. If there is an agreement with the vendor, and permission is granted, the item can be directly scrapped from the quarantine warehouse using the Scrap functionality. If the items are to be returned back to the Vendor in such a case the inventory must be first returned to the default warehouse. A specific location can be defined in the Default Warehouse for this purpose. In this scenario, I am assuming that the product was repaired and deemed fit for use after Quarantine Inspection. Now in order to receive this inventory in the Main Warehouse(W1) we need to use the Item Arrival Journal. 1. The first step is to open that Quarantine Order. 2. Click on Report as Finished from the top of the screen. 3. Click on End from … Continue reading Quality Management Process in Dynamics 365 Supply Chain Management – Part 2 →

Introduction Hello Everyone! In this blog, I will explain the Quality Management Process in Dynamics 365 Supply Chain Management and cover all the necessary setups required for Quality Management. Imagine a supply chain where every component, every process, and every product meets or exceeds customer expectations. Where defects and delays are minimized, and customer satisfaction soars. This is the power of quality management in Dynamics 365 Finance and Operations. For this blog, I have taken the example of an Automobile company that purchases the Product Brake Pads from the Vendor. When car brake pads are received in a warehouse against a purchase order, they undergo specific quality checks, similar to other products. Setup required for Quality Management Process in Dynamics 365 SCM The first step is to enable the Quality Management parameter. The pathway for that is: Inventory Management>Set Up>Inventory and Warehouse Management Parameters. Step 1: Creation of Test Instruments: Depending on the Product Type we must create different Test Instruments to conduct quality tests on the Product. So here I need to create these instruments for my Product Brake Pads. To create Test Instruments, Go to Inventory Management>Set Up>Quality Control>Test Instruments. Now click on New from the top of the screen then enter the Name, Description, and Unit of the Instrument. Here I have created three different Test Instruments for the product Brake Pads. The Precision here is linked to the Unit which can be edited in the unit setup. Step 2: Creation of Tests: Now, the next step is to create the Tests in the system which I will use to check the Quality of the product Brake Pads. So as per my requirement Brake pads will be Tested for the following tests. Note: There are two types of tests: To create Tests in the system, go to Inventory Management>Set up>Quality Control>Tests. To create a Test click NEW from the top of the screen. Then enter the name and description of the Test. Then select the Type and Test Instrument. Follow these steps to create all the required Tests in the system. Step 3: Creation of Test Variables: The Test Variables page allows you to configure, modify, and observe the potential results for a test variable linked to a qualitative test. When selecting an outcome as a test result, you assign a Pass or Fail status to each outcome to indicate whether the test has been passed or failed. It is always better to define a minimum of two outcomes that is one with a Pass status and one with a Fail status for each variable. There are no restrictions on the maximum number of variables or outcomes that can be specified. Moreover, multiple tests can utilize the same test variables to record results. To create Test Variables, go to Inventory Management>Set Up >Quality Control>Test Variables. Step 1: Click on NEW from the Action Pane at the top of the screen, then enter the name and description of the Variable. To make it easy to understand here the Variables are created similar to the Test name. Step 2: The next step is to enter the Outcomes. For that select the Variable and then click on Outcomes from the Action Pane which is at the Top of the screen. Step 3: In the Test Variable Outcomes page click on NEW from the top of the screen. Then enter the Name and Description of the Outcome. When the outcome is selected as a test result, choose either Pass or Fail to indicate whether the test has been passed or failed. Repeat Steps 1, 2, and 3 to create multiple Test Variables and their Outcomes. Item Sampling According to the Business Requirement you must specify the sample size for testing which can be indicated as a percentage or a fixed quantity. In this scenario, the entire quantity received in the stock from the Purchase Order will be selected for testing. So in this case I will establish item sampling for the entire quantity, representing 100% of the items. Full Blocking Parameter under Item Sampling The Full Blocking parameter is enabled on the basis of business requirements. For example, if I create the item sampling as 10% and if I receive 100 qty so among them only 10% qty will be taken for testing. In such a case if I enable the full blocking parameter, even though I will be testing only 10% of 100 qty the system will automatically block the rest of the 90% of the quantity as this option is enabled. But if this parameter is disabled then only 10% of the qty will be blocked for quality inspection and the rest of the 90% qty can be used for consumption. Per Updated Quantity Parameter under Item Sampling Enabling this feature ensures that a Quality order will be generated specifically for the quantity received in a Purchase Order, whether it is a complete or partial quantity. For example, Item sampling is set to 100%, If the Purchase Order quantity is 100 and the Per Updated Quantity parameter is enabled and if I received a partial quantity that is 50, in such a case the Quality Order will be generated for 50 quantity and not for 100 quantity as the Per Updated Quantity parameter is enabled. But if this parameter is disabled and if I receive a partial quantity of 50 the Quality Order will be generated for the entire 100 quantity. Now to Create Item sampling the pathway is Inventory Management>Set up>Quality Control>Item sampling. In the Item Sampling page click NEW from the Top of the screen. Then enter the name and description of the sampling that you want to create. In the above screenshot, you can see that I have created an Item sampling of 100%. Under the name and description field, you can see the Sampling Quantity field in which I have selected the Quantity Specification as Percent. You can either select Percent or Fixed Quantity depending on the business requirement. Here I have defined the value … Continue reading Quality Management Process in Dynamics 365 Supply Chain Management (SCM) – Part 1 →

In this blog, we will learn how to change a Product’s Product Number. For this blog, I have created a New Product, Hand Gloves with Product Number P-000015 and released it into the system. The Path for Changing the Product Number is: Product Information Management>Products>Products. Step 1: Click on Change Number under the Maintain tab. Here, my Product number is P-000015 which I will change to P-000020. Step 2: Enter the New Product Number and Click on OK. The above screenshot shows that the Product Number has now changed from P-000015 to P-000020. Note: It is recommended to rename only if no transaction exists for the product. If the Product already has an existing transaction, it is better to create a new Product.

In this Blog, we will learn how to Acquire a Fixed Asset from Purchase Requisition (PR). The method that we are using for this process is: Purchase Requisition > Purchase Order Creation > Purchase Order Invoice > Fixed Asset. Prerequisites In the fixed Asset Parameters, Under Purchase Order Enable Allow Asset Acquisition from Purchasing. Step 1: Create a New Purchase Requisition. Step 2: Click Add Line and add the Details such as Units, and Fixed Asset Category. Step 3: Submit and Approve the PR. Step 4: After Approval Click on Release Approved Purchase Requisition. Path: Procurement and Sourcing > Purchase Requisition > Approved Purchase Requisition processing > Release Approved Purchase Requisition. Step 5: Select the Approved PR and then click on Purchase Order. Step 6: Select the Vendor. Step 7: Now open the Purchase Order and enter the Amount. Step 8: Confirm the Purchase Order and post the Product Receipt. After Posting the Product Receipt we can see that the Fixed Asset number has been populated on the Line level and the status of the Purchase Order has been changed to Received and Confirmed. Now if we click on that Fixed Asset and then click on Books, we can see that the Fixed Asset has the status “Not yet Acquired”. Step 9: Post the Invoice to Acquire the Fixed Asset. Now if we check the Status of the Fixed Asset, it is changed to Open which means that the Fixed Asset has been Acquired. That’s it for this blog hope this will help you. Thank You!