Manual finalization and aging
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.
The borrowed items are not returned to the lending project. The borrowed items and their value are added to the borrowing project’s inventory as described in Borrow - example of cost aspects, but permanently. The payback is a purely financial compensation for the lending project.
Reasons to finalize borrow/loans manually or by aging:
- The difference of the inventory value between the moment of borrowing and (forecasted) payback is negligible.
- Outstanding loans are finalized after a fixed period according to policy.
Impact
The consequence of aging or manual finalization is that the lending project is not replenished by the borrowing project and consequently there is an inventory shortage. The lending project must now (urgently) reorder the missing inventory, often at higher costs than it would have incurred by the automatic payback. In addition, this new shortage may also trigger new project cost peg transfers.
Finalizing the borrow/loan procedure while a supply order is present for the borrowing project may result in excess inventory for the borrowing project cost peg. However, Enterprise Planning can identify this forecasted excess and allocate the expected receipt to another demand. If no supply order is present when you finalize a borrow/loan transfer, Enterprise Planning identifies the shortage of the lending project and creates new supply orders – at a rather late stage.
Manual finalization
To finalize an individual borrow/loan transfer, in the Borrow/Loan (whinh1146m000) or Borrow/Loan (whinh1646m000) session, select the relevant transfer and using the appropriate menu, select . You are then prompted to specify a reason.
Aging
You can use the Aging of Borrow/Loan Cost Peg Transfers (whinh1246m000) session to finalize a range of borrow/loan transfers.