Counting reason codes

  • 6 minutes

Reason codes help you analyze the results of a counting process and any discrepancies that occur during that process. You can specify the reason for doing the count, such as for a broken pallet or for a stock adjustment that's based on inventory samples.

Before you set up the system, we recommend that you define a strategy for working with reason codes. For example, try to answer the following questions while defining your strategy:

  • Should reason codes be mandatory on warehouses?

  • Should reason codes be mandatory or optional on some items?

  • How many reason codes do you require?

  • Do you need to preselect a limited list of reason codes for adjustments?

  • How should people who use barcode scanners use reason codes? Should the reason codes be preselected, mandatory, or not editable?

  • Do warehouse workers require different reason code behavior on mobile scanners? If the answer is yes, you can create more menu items and assign them to different people.

  • Should the reason codes drive financial offset account posting?

You can create multiple reason code policies, and each reason code policy can have two counting reason code policies. You can use the counting reason code policies at the warehouse level or the item level.

Warehouse and retail workers who make inventory adjustments can select the reason for the adjustment as they work. With a list of possible reasons for adjustment (stolen, expired, or damaged), they can post adjustments to the appropriate offset account for each reason. This approach results in the system automatically posting adjustments as a counting journal to the correct account after workers register it.

To set up reason code policies, use the following procedure:

  1. Go to Inventory management > Setup > Inventory > Counting reason code policies, and then create a new reason code policy.

  2. In the Counting reason code type field, select Mandatory or Optional to specify whether selection of a reason code should be an optional or a mandatory action in one of the following counting journals:

    • Cycle count (mobile device)

    • Spot count (mobile device)

    • Threshold count (mobile device)

    • Adjustment in (mobile device)

    • Adjustment out (mobile device)

    • Counting journal (rich client)

Additionally, you can set up reason codes for individual warehouses and for products. The reason code setup for products can disregard the setup for warehouses.

Mandatory reason codes

If the Mandatory parameter is set in the configuration of reason codes for warehouses or items, you can't complete the counting journal and close it until you provide a reason code.

To set up reason codes for warehouses, use the following procedure:

  1. Go to Warehouse Management > Setup > Warehouse > Warehouses.

  2. On the Inventory and warehouse management tab, in the Counting reason code policy field, select one of the following options:

    • Blank - Use the parameter that's set up for the item to determine whether counting journals are mandatory for the product or not.

    • Mandatory - A reason code is always required on counting journals for the warehouse.

    • Optional - A reason code isn't required on counting journals for the warehouse.

To set up reason codes for products, use the following procedure:

  1. Go to Product information management > Products > Released products.

  2. On the Product tab, select Counting reason code policy, and then select one of the following options:

    • Blank - Use the parameter that's set up for the warehouse to determine whether counting journals are mandatory for the product or not.

    • Mandatory - A reason code is always required on counting journals for the product. This setting overrides any reason code setting at the warehouse level.

    • Optional - A reason code isn't required on counting journals for the product. This setting overrides any reason code setting at the warehouse level.

Use reason codes in counting journals

In a counting journal, you can add reason codes for counts of the following types:

  • Cycle count

  • Spot count

  • Threshold count

  • Adjustment in

  • Adjustment out

You would add reason codes to the journal lines in counting journals of the Counting journal type.

  1. Go to Inventory management > Journal entries > Item counting > Counting.

  2. In the line details of the counting journal, in the Counting reason code field, select an option.

To view the counting history as it's recorded by reason codes, go to Inventory management > Inquiries and reports > Counting history, and then in the Counting reason code field, view the counting history that's recorded through a reason code.

Screenshot of the Counting history page.

Use a reason code for a quantity adjustment

To add a reason code for a quantity adjustment, use the following procedure:

  1. On the On-hand inventory page, select Adjust quantity. You can open the On-hand inventory page in several ways, such as by selecting Inventory management > Inquiries and reports > On-hand inventory.

  2. Select Adjust quantity, and then in the Counting reason code field, select a reason code.

Reason codes help you break down the results of a counting process and any differences that may occur and make any necessary adjustments during the process. For example, the adjustment functionality can be used to post on-hand inventory adjustments to the appropriate accounts based on the reason code.

Set up reason codes

The following procedures describe how to set up reason codes.

Set up reason code policies

To set up reason codes policies, follow these steps.

  1. In the Feature Management workspace, check to make sure Post on-hand adjustments using configurable reason codes connected to offset accounts feature is enabled.
  2. Go to Inventory management > Setup > Inventory > Counting reason code policies.
  3. On the Action Pane, select New to add a policy to the grid.
  4. Set the Name field for the new policy.
  5. In the Counting reason code type field, select either Mandatory or Optional to specify whether select of a reason code should be optional or mandatory in one of the following inventory adjustment processes for:
    • Mobile device - Cycle count, Spot count, Threshold count, Adjustment in, Adjustment out
    • Rich client - Counting journal, Quantity adjustment/Online counting

Assign counting reason code policies to products

To assign counting reason code policies to products, follow these steps.

  1. Go to Product information management > Products > Released products.
  2. Select a product in the grid.
  3. On the Action Pane, on the Product tab, in the Set Up group, select Counting reason code policy.
  4. In the Assign counting reason code policy drop-down dialog box, select a name that has a policy of Optional or Mandatory.

Set up counting reason codes

To set up counting reason codes, follow these steps.

  1. Go to Inventory management > Setup > Inventory > Counting reason codes.
  2. On the Action Pane, select New to add a row to the grid.
  3. Set the Counting reason code and Description fields for the new row.
  4. To assign an offset account, enter or select a value in the Offset account field. If selected, the value is posted to the offset account instead of the default inventory posting profile account.

Set up counting reason code groups

Counting reason code groups can be used in the Warehouse Management mobile app's Adjustment in and Adjustment out menu items to narrow down the list of counting reason codes. To set up counting reason code groups, follow these steps.

  1. Go to Inventory management > Setup > Inventory > Counting reason code groups.
  2. On the Action Pane, select New to add a group.
  3. Set the Counting reason group and Group description fields for the new group.
  4. On the Action Pane, select Save.
  5. In the Details section, select New on the toolbar to add a row to the grid. Then set the Counting reason code field for the new row.
  6. Repeat the previous step to assign more codes as required. If you must remove a code from the group, select it, and then select Delete on the toolbar.

Set up mobile device menu items for a counting process

To set up mobile device menu items for a counting process, follow these steps.

  1. Go to Warehouse management > Setup > Mobile device > Mobile device menu items.
  2. Select the relevant menu item in the List pane or create a new menu item.
  3. On the Action Pane, select Cycle counting.
  4. In the Default counting reason code field, set the default reason code that should be recorded when the mobile device menu item is used to do counting.
  5. In the Display counting reason code field, select one of the following values:
    • Line – Show the reason code after each variance is recorded.
    • Hide – Don't show the reason code.
  6. Set the Edit counting reason code to Yes to allow the worker to edit the reason code when shown on the mobile device during counting. Set it to No to prevent the worker from editing the code.

Set up mobile device menu items for adjustment in and adjustment out

To set up mobile device menu items for adjustment in and adjustment out, follow these steps.

  1. Go to Warehouse management > Setup > Mobile device > Mobile device menu items.
  2. On the Action Pane, select New to create a menu item.
  3. Set the Mobile item name and Title fields for the new menu item.
  4. Set the Mode field to Work.
  5. Set the Use existing work option to No.
  6. In the Work creation process field, select Adjustment in or Adjustment out.
  7. On the General FastTab, set the following fields. (All these fields are added when you select Adjustment in or Adjustment out in the Work creation process field.)
    • Use process guide – If you're creating an Adjustment out process, be sure to set this option to Yes. If you're creating an Adjustment out process, this option is always set to Yes.
    • Default counting reason code – Set the default reason code that should be recorded when the mobile device menu item is used to do counting.
    • Display counting reason code – Select one of the following values:
      • Line – Show the reason code after each variance is recorded.
      • Hide – Don't show the reason code. -Edit counting reason code – Set this option to Yes to allow the worker to edit the reason code when it's shown on the mobile device during counting. Set it to No to prevent the worker from editing the code.
    • Counting reason code group – Select a reason code group if you want to limit the list of options that is presented to workers.

Use counting reason codes

Reason codes are recorded when the Warehouse Management mobile app is used. Therefore, reason codes are instantly used in the counting journal posting unless a counting approval process has been defined.

Modify reason codes for cycle count approvals

To modify reason codes for cycle count approvals, follow these steps.

  1. Go to Warehouse management > Cycle counting > Cycle count work pending review.
  2. Select a cycle count in the grid.
  3. On the Action Pane, on the Work tab, select Cycle counting.
  4. Then, in the Reason code field, select a new reason code.

Reason codes are added to the journal lines in counting journals of the Counting journal type.

  1. Go to Inventory management > Journal entries > Item counting > Counting.
  2. In the line details of the counting journal, in the Counting reason code field, select the reason code that matches your current situation.

View the reason codes recorded in the counting history

To view the reason codes recorded in the counting history, follow these steps.

  1. Go to Inventory management > Inquiries and reports > Counting history.
  2. Select an item count record in the list pane.
  3. In the Counting reason code field, view the counting history that has been recorded through a reason code.

Use reason codes for quantity adjustment or online counting

To Use reason codes for quantity adjustment or online counting, follow these steps.

  1. Go to Inventory management > Inquiries and reports > On-hand list.
  2. On the Action Pane, select Quantity adjustment.
  3. In the Counting reason code field, select a reason code.