FREIGHT item distributions - location segment

We have recently implemented a freight solution using a Freight modifier in conjunction with the FREIGHT item to apply freight charges to our sales orders. The modifier is applied to the sales order line and when interfaced through to AR the modifier is converted to a FREIGHT item. We did this to allow us to apply tax on the Freight charge.

We've noticed that on the AR side the location segment on the distributions is incorrect for the FREIGHT item. We presumed that the location would be sourced from the item setup but this doesn't appear to be the case.