Due to the Residual Qty we see difference in Inventory Valuation and on Hand Balances

Summary:

We have Dual UOM enabled for our items, and our costing is based on the secondary UOM. In Cost Management, the valuation unit is set at the cost organization level. When we post certain Inventory transactions (for example, miscellaneous transactions) using the secondary UOM, the system automatically generates “Residual Receipt Issue” transactions where the secondary quantity is issued and the primary quantity is 0.

Because of these “Residual Receipt Issue” transactions, costing is failing and some records are getting stuck due to a negative on-hand balance. In reality, we do have on-hand quantities, but Inventory Valuation is considering the residual receipt issue quantity, which causes the costing error: “The issue transaction is fully costed but not yet fully depleted because there are unresolved negative inventory quantities.”