Cost peg transfers - borrow/loan and payback

The borrow/loan and payback process constitutes the temporary transfer of inventory between two projects. LN can temporarily transfer cost pegged items from one project, the lending project, to another, the borrowing project, to fulfill an urgent demand. After the inventory is replenished, the borrowing project transfers the borrowed item quantities back to the lending project.

The borrow/loan and payback procedure is carried out automatically, but you can set an aging period or manually intervene to finalize the procedure before the automatic payback is due. Manual finalization is used for individual borrow/loan transfers and aging is used for collective finalization. Manual finalization and aging result in the permanent transfer of the inventory to the borrowing project and a financial compensation to the lending project.

Item values can fluctuate between the moments of borrowing and paying back. To prevent that the lending project is affected by cost increases, inventory is paid back at the inventory value at which it was borrowed.

Various sessions provide insight into the progress of borrow/loan and payback transfers, both logistically and financially. These sessions help you decide whether borrow/loan transfers must be manually finalized, before the payback is due.

To use the borrow/loan and payback procedure and/or permanent cost peg transfers, you must set the required parameters and transfer rules.