FTZ Management: Knowledge Based Articles - Negative Receipt Processing
Validating RNPC/RNIM transactions
This article is an overview of the negative receipt assignment process. It details how to identify, and correct validation errors encountered on the Negative Receipt Information screen of the ONESOURCE Global Trade Foreign Trade Zone Management (FTZ) solution.
Purpose of RNPC/RNIM Transactions
A negative receipt transaction (RNIM/RNPC) will remove or “back out” inventory incorrectly received into the zone. The negative receipt allows a user to remove incorrect inventory from the system
without
reporting it on entry.Example
You are expecting 30 cartons with 100 pieces in each carton. The receiving floor will scan the cartons and enter a receipt (RPPC/RPIM) for 3000 (30 cartons*100 pieces) pieces to admit into the zone. That receipt transaction feeds into the (FTZ) solution, and the zone operator admits the receipt on a 214 admission.
Upon review, it is determined there are only 80 pieces per carton and the actual stock that should be admitted is 2400 (30 cartons*80 pieces). A negative receipt is triggered from the ERP system to remove the errant 600 pieces from inventory without placing them on a customs entry, because the goods were never actually received into the warehouse.
Transaction Fields
The following fields of a negative receipt must match the receipt inventory intended to back out.
Required fields to match
- ProductNum – The product number of the receipt being reversed.
- CountryOfOrigin – The country of origin of the receipt being reversed.
- StatusCode – The zone status of the receipt being reversed.
- TxnQty – The amount of the receipt being reversed. Must be a negative number.
Optional additional fields to match
By default, the system will match on the ProductNum, CountryOfOrigin, and StatusCode of the most recent inventory available. To be more specific with matching to any one receipt, additional fields can be used to add this granularity to identify the correct receipt that needs to have a quantity reduced.
- BillOfLading – The Master/House Bill of the receipt being reversed.
- ITNum – The ITNum of the receipt being reversed.
- AdjReceiptDocID – The 214 number (ReceiptDocID) of the receipt being reversed.
Look Back Period
The system has a configured look back period, which sets the maximum amount of time that can pass before receipt inventory is not allowed to be backed out by a negative receipt transaction. By default, the lookback period is 15 days within the receipt date of the receipt for compliance reasons.
In addition to matching on the fields noted above, the receipt date of a receipt must also fall within the specified look back period in order to be eligible inventory to remove.
Validating Negative Receipts
Yellow lines displayed on the Negative Receipt Information screen after validating represent negative receipt transactions that do not have matching inventory, or large enough quantity, to back out. Review the required fields to ensure that a match exists. If inventory exists, check the receipt date of that inventory to ensure it is within the allowable look back period.
To validate and correct negative receipt transactions:
Step | Action |
|---|---|
1. | Navigate to Assignment → Negative Receipt Information. |
2. | Click Validate towards the top of the screen. |
3. | A “Validation Successful” message will appear if there is enough matching inventory to back out. If yellow lines are displayed, continue to step four. |
4. | A yellow line represents the negative receipt. If any potentially eligible inventory exists in the system, it will be shown as an additional line directly after the yellow negative receipt line. If it is determined an update is required, proceed to step five. If the information is correct, further review of the discrepancy will be necessary. |
5. | Click Expand next to the yellow line to see individual negative receipt transactions being processed with the current matching fields. |
6. | Click Edit to navigate to the FIFO Processing Correction screen to edit the transaction. |
7. | Make the necessary updates, click Save then Validation to navigate to Validation Summary screen. |
8. | It is necessary to revalidate transactions after a change is completed. Click Revalidate to kick off validation. When validation is complete, start from step one to validate negative receipts again and confirm the match now exists. |
Common Causes of Errors
Inventory that should have been backed out was already consumed by a shipment
If a shipment transaction processed consumes a particular receipt in inventory prior to a negative receipt transaction targeting the same receipt, you may find no inventory available to reverse. In this scenario, changing the negative receipt to a negative adjustment (ANPC/ANIM) may be the best course of action to ensure correct inventory balances are preserved.
note
A negative adjustment transaction acts in a similar manner to a shipment into US commerce. A negative adjustment will be reported on the weekly entry if foreign inventory is consumed and subject to applicable duties.
Inventory exists, but is outside the configured look back period
In instances where inventory exists, but the receipt date falls outside the look back period, there are a few options to consider. First, verify the receipt date is correct on the receipt attempting to back out. Second, a review with your compliance team, or consultant, will be necessary to determine next steps. You may end up adjusting inventory out of the system and potentially paying duties rather than processing a negative receipt. Another option would be to adjust the allowable look back period beyond the default 15 days to allow the receipt to be backed out of inventory.
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