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LCM-OPM Walkthrough Full Testcase
LCM-OPM Walkthrough Full Testcase
Available documentation:
- Note 837161.1 - EBS LCM - Suggested Common Setup Steps for Landed Cost Management
- Note.860747.1 - EBS LCM How To Diagnose Issues With Landed Cost Management In Procure To Pay Cycle
- Oracle Landed Cost Management Process Guide, Release 12.1, Part No. E14299-02
- Oracle Process Manufacturing Cost Management User's Guide, Release 12.1, Part No. E13655-03
QP: Blind Discount Option Yes Application (Oracle Landed Cost Management
QP: Licensed for Product Purchasing Application (Oracle Landed Cost Management
QP: Pricing Perspective Request Type Purchase Order Application (Oracle Landed Cost Management
QP: Source System Code Oracle Purchasing Application (Oracle Landed Cost Management
- Purchasing Super User (process Operations) responsibility, Setup – Purchasing – Cost Factors
- Purchasing Super User (process Operations) responsibility, Advance Pricing - Modifiers – Modifier Setup
- On Discount and Charges tab:
1.5. Create LCM Shipment Line Types
- Note that Landed Cost Management responsibility is not assigned by default to PROCESS_OPS user;
- Landed Cost Management responsibility, Setup – Shipment Line Types (value used for INL profile setup):
1.7. Setup UOM Classes
- Inventory Super User (Process Operations) responsibility, Setup – Unit of Measure – Classes
IMPORTANT: Define ‘Name’ field exactly as shown above in order to exactly match the values selected for Allocation
basis field on Cost Factors setup page.
- Also, these UOM classes will be used further for Landed Cost Management profiles setup (i.e. INL profiles).
- We will use the setup option for ‘Pre-Receiving in LCM’ being checked.
- Note: Although all the existing setup screenshots are indicating that flag ‘Interface to Advanced Pricing’ from Cost
factors section should NOT be checked, for this setup example, I checked the flag.
- IMPORTANT: We must setup Organization Access for responsibility Landed Cost Management and organization
PR1. Otherwise, we cannot see Inventory Organization = PR1 in LCM Setup - Options page.
- Organization Access is being setup in Inventory Super User (Process Operations) responsibility, Setup –
Organizations – Organization Access
1.12.1. Account Derivation Rules for INV, LCA and LCV journal line types:
1.12.2. Journal Line Definitions having attached new account derivations rules:
- Event Class = Landed Cost Adjustments; Event Type = Landed Cost Adjustment - Deliver
- Event Class = Landed Cost Adjustments; Event Type = Landed Cost Adjustment - Valuation
- Note that only required ADRs for this example have been defined.
1.12.3. Application Accounting Definition, having the new Journal Line Definitions being assigned:
1.12.4. Subledger Accounting Method having the new AAD being assigned for Process Manufacturing Financials:
1.12.5. Finally, checking that correct Subledger Accounting Method is being assigned to the OPM US ledger:
- Under General Ledger responsibility, go to Setup – Financials – Accounting Setup Manager – Accounting Setups
2.1. Define inventory item GSLCM03 and assigned to PR1 inventory organization
2.2. IMPORTANT: Make sure that on Costing tab, the ‘Inventory Asset Value’ is being checked!
2.3. Create an approve a PO for item GSLCM02, qty = 100, unit price = 100
IMPORTANT: After the PO is being approved, the field LCM_FLAG on PO_LINE_LOCATIONS_ALL table should become
‘Y’, otherwise will not be found in LCM module.
IMPORTANT: Make sure that Invoice Match Option = Receipt on the PO Shipment line.
2.4. Under Landed Cost Management responsibility, go to Workbench – Shipments
- On Create Shipment page, on Header section, enter Operating Unit, LCM Shipment Type (i.e. SHIP), Receiving
Location;
- On Line Groups, enter a Group Reference identifier (any text), Source Type = Purchase Order, Third party as the PO
supplier, and its Site (last 2 information to be taken from PO header) then Apply changes
- go to Lines tab
- On the Lines tab, go to section Find Expected Shipment Lines and enter the Purchase order number, then click on Go
button
- Once the Shipment line is being retrieved, selected and Save the LCM Shipment
- After LCM Shipment is saved, we can execute Generate Charges action
- Next, perform the Validation action by selecting Validation value from Actions LOV and click on GO button
- On Allocation page, we can verify the Estimated Amounts and total Unit Landed Cost ;
Note the charge amounts related to freight (1000 USD = 10% x total item value) and insurance (200 USD – fixed
amount);
- Once the Shipment has been submitted, it can no longer be updated. Optionally, we can review the charges:
- When executing the Submit action, Receiving Transaction Processor is being run
2.5. Perform the normal PO receipt through the standard Receipts form
- Note that on Find Expected Receipts form, we have to specifically select Source Type = LCM and then, in Shipment
field, look for LCM Shipments to be received.
- Normally, it is considered that, selecting Source Type = All, we should be able to see expected data. However, for
the moment, we need to specifically select Source Type = LCM, to access LCM shipments to be received.
- Further, select the line to be received, enter required information for subinventory, location and lot and save the
receipt.
2.6. In OPM Financials, submit Landed Cost Adjustments Import Process
2.7. Next, run Cost Update, OPM Accounting Pre-Processor and Create Accounting to see postings so far for PO
Receipt 17711 and item GSLCM03:
- Cost Update:
- OPM Accounting Pre-Processor:
- Detailed Subledger Report for given OPM Accounting Pre-Processor reference number3304:
Purchasing Transactions
Entity Name Purchasing Event Class Receiving Event Type Receive to Inspection
Transactions Name Name
Organization PR1 Item GSLCM03 - GSLCM03 Base Currency USD
Purchase Order 3921 Supplier Winters Supply Company
Receipt Number 17711 Receipt Line 1
Number
Transaction Id 373 Quantity 100.00000 Ea Transaction Date 30-JAN-2010
00:00:00
Journal Base Currency Billing Currency
Line Type Account Description Debit Credit Debit Credit
AAP 10,000.00 10,000.00
ISP 10,000.00 10,000.00
ISP 200.00 200.00
LCA 200.00 200.00
ISP 1,000.00 1,000.00
LCA 1,000.00 1,000.00
Total 11,200.00 11,200.00 11,200.00 11,200.00
Purchasing Transactions
Entity Name Purchasing Event Class Deliver to or Return from Event Type PO Receipt
Transactions Name Inventory Name
Organization PR1 Item GSLCM03 - GSLCM03 Base Currency USD
Purchase Order 3921 Supplier Winters Supply Company
Receipt Number 17711 Receipt Line 1
Number
Transaction Id 23607993 Quantity 100.00000 Ea Transaction Date 30-JAN-2010
00:00:00
Journal Base Currency Billing Currency
Line Type Account Description Debit Credit Debit Credit
INV 11,200.00 11,200.00
ISP 11,200.00 11,200.00
Total 11,200.00 11,200.00 11,200.00 11,200.00
- Create Accounting:
2.8. Enter 2 invoices in Payables: one to be matched with Item line type and second to be matched with Freight and
Miscellaneous (for insurance) line types.
- First, enter invoice header details for the invoice to be matches with Item line type;
- Invoice total amount will be 11,000 USD, so final item unit price will be different than in PO (item unit price in PO is
100 USD with quantity = 100 Each ordered)
- Select the line to be matched, change the unit price to 110 and click on Match button:
- Once the matched line has been added to the invoice, go to Actions button and select Validate option
- And the first invoice has been validated:
- We will select the same supplier, but invoice can be entered against any other supplier.
- Invoice total amount will be 1,300 USD (1,100 USD for Freight and 200 USD for Insurance).
- This should result in different actual Landed Cost for Freight (estimated landed cost for freight was 1,000 USD).
- After entering invoice header details, click on match button to add matched invoice lines;
- First, select Type = Freight and same receipt number = 17710, then click Find:
- On Match Other Charges to Receipts form, enter Cost Factor Name (LCM Freight Charges) and related amount for
freight (i.e. 1100 USD);
- After invoice line for freight has been added, click again to Match button;
- This time, select Type = Miscellaneous and the same receipt number = 17711:
- On Match Other Charges form, enter Cost factor name = LCM Insurance Charge and related amount (i.e. 200 USD),
then click Match;
- Now, the invoice line related to insurance has been added as well and we can validate the second invoice:
- The request log file confirms that the 4 transactions found in INL_MATCHES_INT table have been processed (and
removed from this table):
- If we are checking the LCM Shipment number 2 in LCM Workbench, we will notice that ‘Pending Matching’ flag is
now checked.
- Next step is to run ‘Submit Pending Shipments’ request from LCM responsibility:
- The log file confirms that LCM shipment has been processed:
2.10. If we query the LCM Shipment number 3 in LCM Workbench, we can see the actual amounts:
2.11. In OPM Financials, re-running Landed Cost Adjustments Import Process
2.12. Before running Actual Cost process in OPM Financials, checking the cost type , fiscal policy and cost calendar
being defined:
2.13. Now, we can run Actual Cost process for following parameters:
- Checking the cost for item GSLCM03, we see that actual Landed Cost has been included in item cost.
2.14. Running Cost Update for given cost calendar and period:
- Note that for INV and LCA journal line type we have to define specific Account Derivation Rule
3. Technical Considerations
3.5. Cursors to gather landed cost details are in functions gmfaget_rct_acqui (for estimated landed costs) and
gmfaget_lc_adj_transactions (for actual landed cost)
- Changes were done to get both estimated landed costs (cursor C_PO_COST_DTL_FETCH_ALL) and actual landed
cost (cursor C_LC_ADJ_TRANS_FETCH_ALL).