You can define and maintain an unlimited number of physical inventories in Oracle Inventory. A physical inventory is identified by a unique name you assign. You use this name to identify any activity, such as adjustments, pertaining to this physical inventory.

You can define multiple physical inventories to count selected portions of your inventory, or you can count your total inventory. For example, if your warehouse has two large stockrooms, each represented by a subinventory, you can define two physical inventories, one for each subinventory. You can then perform your physical inventory of the first stockroom, independent of the second.

To define a physical inventory:
Navigate to the Physical Inventories Summary folder window and choose New. The Define Physical Inventory window appears.

1. Enter a unique physical inventory name.

2. Select approval requirements for adjustments.
Always: Require approval of all physical inventory adjustments.
If out of tolerance: Hold for approval those counts that are outside the limits of the positive and negative quantity variance or value tolerances.
Never: Allow any adjustment to post without approval.

3. Enter positive and negative approval tolerances If approval is required for adjustments out of tolerance you must
enter a value in at least one of these fields. You cannot update these values after you perform physical inventory adjustments.
Qty: Enter acceptable Positive and Negative limits (expressed as a percentage) for the difference between the system–tracked on–hand quantity and the actual tag count quantity.
Value: Enter acceptable Positive and Negative limits for the total value of a physical inventory adjustment.

4. Select the scope of the physical inventory.
Determines whether the physical inventory is for all subinventories or for one or more specific subinventories. Only enter a quantity tracked subinventory.

5. Indicate whether to allow dynamic entry of tags.
Determines whether you can dynamically enter tags you manually created. If you choose not to allow dynamic tag entry all tags must generated before use  If you do not want to allow dynamic tag entry but you need blank tags, you can generate numbered blank tags for counting miscellaneous items.