Re: Transfer Costs

[Al Mac <macwheel99@xxxxxxxxxxx>]

We are 405 CD.
We are no longer on OSG tech support.  We switched to an outfit that is 
thousands of times better for a tiny fraction of the cost.  But when we 
were on OSG support, I sent SSA a list of places in CST and other programs 
where there are serious rounding errors, to which they said "That's how it 
is supposed to work."

This topic is part of a royal pain in the rear end for us.
Another dimension is figuring out how come something is messed up so we can 
fix it.
Plus it is too easy for people to transfer inventory from a facility with 
one cost structure to a facility with a different cost structure, and of 
course BPCS costs travel with the transfer.

Tools that help us deal with it include:
* When there is a BPCS program where we can select between some item range, 
or other criteria, we can clone it to add additional selection criteria, 
and have done so.  For example INV260 variant that only lists particular 
item type when on-hand times cost variance not zero.
** Many of our modifications not only highlight line on report where cost 
is suspicious, but at end of report give count how many ingredients on the 
report were of a certain kind of bogusness
* CST920 and CST940 which permit selective copying of costs between 
facilities, cost sets, various other conditions
* Reports I run very frequently, some from GO CMDSCDE, others when most 
folks off system for evening ... then I check on spool file ... if nothing 
there, I delete the report, else I hopefully not have a lot of stuff to fix.
** Think "Screwed up Costs Reports" as one of a series of "Screwed up this 
or that reports" that identify those items with particular conditions that 
need fixing.
* We also have "Blanket Fixit Programs" to repair common conditions.
** Some of these are rather complicated, such as a "Cost Reorganization" 
system I have developed, to get rid of negative costs, and other 
abberations ... I found this to be a simpler way to fix the rounding bugs 
because the problem is systemic
* We use Query/400 VERY HEAVILY
** e.g. match certain criteria items in one facility with same items 
different criteria in another facility, list those where the costs disagree
*** one of these gets summary query work file for items that are in several 
facilities, showing the cost there, combine them to chart cost by facility 
in like a spreadsheet format, with math to highlight which items have cost 
discrepancies across facilities
** e.g. list costs that should not be, such as labor on raw materials
** e.g. inquiry to view what we call "hidden costs", which are really 
inputs that are one of the causes of incorrect costs
* Have a system for identifying parts that are made in one facility, 
supplied to another, using fields in IIM and CIC file that BPCS not use for 
other purposes
** For example
** Item type 1 is for manufactured end items sold to customers
** Item type 7 is for raw materials and purchased parts
** Planner code 7 is for materials we order either from outside vendor or 
from another facility
** Thus, an item with planner code 7 and item type 7 is from an outside vendor
** While an item with planner code 7 in one facility and item type 1 must 
be made at another facility
** Unless we screw it up on keeping all the coding correct

I recently trying to fix some costs & found some parts that get 
manufactured, purchased, manufactured, purchased, and the engineering folks 
(routings, BOM) can't keep up to date, with latest variant, so BPCS is 
doubling up the costs, which has got to complicate the decision whether to 
manufacture or purchase.

We also using special pricing (ESP file) which is another mess.  You cannot 
do it by facility, but we do have different prices by facility.  I have 
suggested using different bill to customer #s for same customers in 
different facilities, so that we can automate the special pricing across 
facilities.  Matching up aggregate customer payments in lump sums hopefully 
would not be a problem if we were using corporate accounts.  This is 
complicated.

I think confidentiality e-mail agreements such as your company is using, 
need to be rephrased so as not to be invalidated by usage on discussion forums.

> We are on 6.1.2 moving to 8.2 soon.
>
> We have facility costing turned on.  How do you handle transfer pricing 
> when you are doing cost rolls? We do use DRP and we do have transfers 
> between facilities. (None are sales - all one company different locations)
>
> Today - when building new frz std costs for new year- enter new purchase 
> prices from Supply chain, roll cost set with current bills and 
> routers.  Then after checking the DRP listings and the transfers for the 
> last year between facilities.  Pick up the supplied rolled up cost and 
> enter it in to the material bucket in the other facility.  Roll the costs 
> again. Repeat if any items then come back for further processing.  Trying 
> to make sure you get all the parts that are "supplied" to the other plant 
> is a pain.  I can't use Item Class or Item type to help identify 
> them.  How do you do this?
>
>
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