We are using IFS 7.5 and we are closing a shop order. Very simple shop order, issues only from received PO’s sitting in project inventory, no material burden, no labor, no standard plan parts. Assume the value of the purchases is 100, the cost of the bacflushed items is 100, but when the shop order is received and closes the OOREC transaction shows a cost of 110. The system then creates a negative & positive entry (SOMTRLV- & SODIFF+) to bring the cost back to 100 so in the end it self corrects. My question is where does the system get the cost of 110 from ? We had no unissuing, or unreceiving, or cost revaluations, and the costs of the components were the same when we received and closed the shop order as they were when we issued the component parts. To my knowledge we hadn’t fiddled around with the quantities of the components in the shop order. The system is finding an additional cost of 10 from somewhere, but I have no idea where. What costs does the shop order close consider ? It’s only bothering me because the accounting transaction for the extra 10 failed to be caught by the accounting rules and ended up as an erroneous posting, and I want to know where it went wrong so we can fix it so it doesn’t happen again.
Hello,
How is your manufactured parts costed? OOREC transaction is valuated at manufactured part calculated cost (irrespective of actual shop order costs), and total value of shop order receipts is adjusted by differences when order is closed.
Please check costing of manufactured part - either different quantity or price of components were used in the cost calculation.
Look at Shop Order Costs under the RMB for Costing on the Shop Order, this will show the standard cost which Adam is pointing you to, the Estimate which is the cost on the shop order at the point of release, and the actual costs tallied on the shop order when it was completed. All three can be viewed alongside one another.
This is V9, but I don’t remember there being a lot different in 7.5.
Bingo !! The missing piece was “Estimate which is the cost on the shop order at the point of release”. That solves it for me, we must have had cost changes after we released the shop order but before we started issuing parts to the shop order. Nothing we could have fixed before we closed the shop order, we will just have to keep fixing these after the event. Thank you !!
The fact that the system generates (SOMTRLV- & SODIFF+) cost variance postings means the part is set up for Standard Costing. The system will use Estimated cost only if Standard Costs have not been calculated for any of the cost sets 2-5 and copied to cost set 1. In Standard Costing model, Cost set 1 is the source reference for generating the Shop Order closing variance postings.
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