Cost aspects of borrow/loan and payback transfers

When a borrow/loan transfer is carried out, the inventory value is transferred from the lending project to the borrowing project. The payback transfer returns the inventory value to the lending project. The transferred items are valuated against the inventory value of the lending project and the borrowing project. The inventory value of both projects is determined by the inventory valuation method used.

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

The borrowed and loaned inventory has no impact on the project costs. For the lending project, the loaned inventory is returned at the original value. For the borrowing project, the difference between the payback value and the replenishment value is posted to the Project Costs and Commitments / WIP Costs and not to the project costs. Borrow/loan and payback transfers are non-billable transactions.