There is a check box  'Use Transit Balance Posting' in Company window > Distribution tab > Inventory tab.

It determines whether balancing postings are to be created between inventory (M1) and transit (M3) posting types. When using the inventory valuation methods: Weighted Average, First In First Out (FIFO), or Last In First Out (LIFO), an imbalance can appear between M1 and M3. By using these posting types the imbalance can be cleared.
Then the TRANSIBAL postings are now added to the receipt or issue transaction that causes the weighted average inventory value to be recalculated.

Here is a previous RnD explanation given on same matter.

“ If you have not set up to Use Transit Balance Postings, it is true that when you analyze M1 and M3 separately, there will not be a zero balance after all parts have been issued in the referred example. But our Inventory Value per Period functionality does not reconcile M1 and M3 separately. From an IFS CORE perspective, any quantity, whether it is in transit or in inventory, is still a part of the company´s inventory value and should therefore be included in the Total Inventory Value that is captured in the Inventory Value per Period window. So there is no such functionality that separates the value in inventory and value in transit in the Inventory Value per Period window. It is only the respective quantities that can be seen. There is no functionality in the system that can clear M1 and M3 separately if you do not have the Use Transit Balance Postings selected from the start. Then the only way to balance M1 and M3 is to create a manual voucher after finding out what balance is left to adjust. There is no way that the system can identify this afterwards, similar to what happens when transactions are created and Balance Invoice Postings are added.”

Hope this will help.

Hi Anushka,

thanks for the reply. This does work for the parts with weighted average as inventory valuation method. But the problem is, that some parts are required to use the standard cost valuation method. Is there a solution for that as well?

Thanks,

Golo

When using standard cost method, you can define cost in inventory part. Cost could be manually calculated/estimated and then entered as an Estimated Material Cost.

Or, the first receipt will set the standard cost. (PO price or entered amount).

That value will be used to Inventory Value calculations until it changed manually.

If you have same cost value defined in inventory part, for both sites, the cost in the inventory transaction history will not differ.