Transcript Infor LN 10.3 -10.4 MAUC Hours Differences

LN: v10.3 to v10.4 Moving Average Unit
Cost (MAUC) Hours Differences
LN 10.4 Rollout Training
Campus course code:02_0021040_EEN0433_ELN
June 2014
Patrick Noblett, Business Analyst, [email protected]
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Intended Audience
• Pre-Sales
• Consulting
• Support
• Pre-requisites to know:
•
•
The concepts of Moving Average Unit Cost (MAUC), Last in First Out (LIFO) and
First in First Out (FIFO) from industry perspective
How LN handles actual costing methods such as Moving Average Unit Cost, Last
in First Out (LIFO), and First in First Out (FIFO).
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2
Agenda
• Why – Moving Average Unit Cost (MAUC) Hours
•
•
•
Big Picture
Business Requirement
Business Problem
• What
•
•
Solution Overview
Solution Details
• Summary
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Big Picture
• Aerospace &Defense (A&D) companies work in a project based environment
• A&D companies work with actual costing methods such as Moving Average
Unit Cost (MAUC) for valuation of the items they make for customers
• Actual costing helps to better compare costs to budgets for profitability of a
project
• Labor hours are tracked on projects and budgeted on projects.
• Each project that makes something will have its own MAUC or project MAUC
(PMAUC)
• Projects tend to share inventory or transfer excess to other projects.
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4
Business Requirement
• A&D companies need the hours and the inventory value of an item.
• The hours need to move from the project that made the item to any project that
ultimately gets the item (via transfer of project ownership).
• Hours are captured and stored for the items that are delivered to the end
customer (a government agency)
•
•
Pegged Items
•
Need to capture hours (internal to the company) that made a pegged ite
•
Do not need production subcontracting hours (these are external)
•
Have the hours roll into another Bill of Material Level
Non-Pegged Items
•
When making non-pegged items, the hours need to be tracked
•
Have the hours roll into another Bill of Material Level
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5
Business Problem
• No production hours associated with an item’s value means, when an
item is moved to another project, the new project :
•
•
•
•
Applies incorrect overhead (total project costs are wrong)
Bills customers incorrectly (customers get invoices based on bad information)
Incorrectly track project progress based on hours correctly, leading to overruns
and projects out of control
Ultimately incorrect project profitability leads to incorrect company profitability
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6
Solution Overview - MAUC
Hours
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Software Requirements
• Retain Production Hours as part of the warehouse value (Project MAUC
(PMAUC), MAUC, Last in First Out (LIFO), First in First Out (FIFO), Fixed
Transfer Price (FTP))
•
•
•
•
New field called Moving Average Unit Hours (MAUH)
Allows transfer of hours and costs between projects (which happens often)
Allows (re) calculation of overhead costs based on hours invested
Allows Projects to bill based on hours when appropriate (Time and Material or Cost
Plus Invoicing)
• Production Orders costing has to incorporate and pass the hours into
Warehousing, Finance and Project
• Extend internal Work In Process
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Production – Hours roll up like costs
into End Items
Total Hours for
End Item
Actual
Hours =5
per piece
Total Actual
Hours =5
per piece
Actual Hours
=28.5 per piece
Total Actual Hours
=28.5 +10 (2x5)
from issued mfg
per piece = 38.5
Actual Hours =1222.25
per piece
Total Actual Hours
=1222.25 per piece + 38.5
from issued mfg per piece
=1260.75
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9
Orders Impacted
• Production Order
• (non-pegged)
• (pegged)
• Production hours variance
• Revaluation Orders
• MAUC Correction by Item
• Actual Costs Correction
• Cost Peg Transfer
• Inventory Adjustment/Cycle Count Orders
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Production Orders
• Manufactured items will be issued with ‘production hours’
• Use standard cost price ‘unit hours’ when manufactured material has FTP valuation
method
• Most all procedures related to costing is touched:
•
•
•
•
Hours booking
Issue Handling
Receipt Handling
Close Order (Variance Calculation)
• Pegged and Non-pegged Items included
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11
Cost Peg Transfer – Prior to 10.4
Project B
Project A
Costs
Hours
Soft Pegged
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12
Cost Peg Transfers – 10.4
Project B
Project A
Costs
Soft Pegged
Hours
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MAUC Hours Parameters
• Implemented Software Components (Concepts (Logistics))
• Hours in Costing (this to show them or not on various sessions).
• Other parameters to consider
• Inventory Handling Parameters (Receipts Tab)
• Default Inventory Receipt Value
• Standard Cost (Always takes standard hours)
• Inventory Value (Will take inventory value to determine hours)
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Sessions containing MAUC Hours
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Inventory Receipt Transactions (whina1512m000)
MAUC by Warehouse Valuation Group (whina1534m000)
Inventory Consumptions (whina1514m000)
Inventory Variances (whina1516m000)
Item Lot (whltc1100m000) and Lot Cost Details (whltc1501m000)
• MAUC Correction by Item (whina1231m000)
• Actual Cost Correction (whina1230m000)
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15
MAUC by Warehouse Valuation Group
(whina1534m000)
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16
MAUC Correction by Item
(whina1231m000)
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17
Summary
• Big Picture – A&D companies need hours in the value of items for project
management, overhead application and invoicing
• Solution – MAUC Hours added to inventory costing
• When inventory (happens often) is moved from one project to another the costs
and hours can move
• Take some time to review this for yourself
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