cto cost rollup
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CTO Cost RollupTRANSCRIPT
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Copyright 2015 Oracle and/or its affiliates. All rights reserved. | 1
Cost Rollup Process For Configured Items (CTO)
Devaraju Holenarasipur Rajkumar Chockalingam
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Copyright 2015 Oracle and/or its affiliates. All rights reserved. |
Objectives
How cost rollup works in case of Configured Items (CTO)
Key setups / Processes Involved
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Agenda
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Introduction
Cost Rollup Process For CTO
Basic setups and Process Flow
Scenarios
Troubleshooting CTO Cost Rollup Issues
Question And Answer 6
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Introduction
Environment in which product or service is assembled or kitted on receipt of Sales Order
Includes ATO, PTO and Hybrids
ATO Configuration item is created from selected options using configurator
ATO Item can be used to Create Pre-Configurations
In case of PTO, Pick slip used to kit included items and selected options.
What is Configure to Order
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Introduction
Calculates the cost of an Assembly Item (Configured item) as per the required components, subassemblies, resources, and overheads.
Configuration item cost rollup is a single level cost rollup.
Optional Process that occurs during the Auto create configuration Process
Also can be run manually for all sales orders and preconfigured items using the CTO Calculate Cost Rollup concurrent program.
CTO Cost Rollup
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If the organization is using standard costing, CTO will update the frozen cost of the configuration with the cost rolled up in the CTO cost type.
If the costing organization is an average, LIFO, or FIFO organization, the valuation cost of the item is not updated and the cost in CTO cost type serves as an estimated cost.
If a configuration item is purchased, an entry will be created in CTO Buy Cost type, based on the list price of the configuration in the PO Validation Organization
CTO cost rollup will internally call Supply chain cost rollup.
CTO Cost Rollup Introduction
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In the case of Multilevel configuration items, CTO performs the cost rollup for all configuration items in the BOM, starting with the lowest level configuration item. Cost of the parent configuration uses the cost of the child configuration from the CTO cost type.
For procured configurations, the cost specified in the profile BOM: CTO Buy cost type is used as the Buy Cost, and is included in the rollup of the parent configuration
CTO Cost Rollup Introduction
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Make Configuration Cost Rollup Process For Make configurations, the cost is rolled up by adding up the valuation costs of
all the components / subassemblies in the configuration BOM for which Include in cost rollup flag is set to Yes.
The cost is first rolled up in seeded, non updatable CTO cost type, then the value in CTO cost type is copied to frozen
This is the total Rolled up Cost for the configuration. The cost is calculated in the manufacturing organization.
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Buy Configuration Cost Rollup Process If a configuration item is purchased, an entry will be created in the cost type
specified in the profile BOM: CTO Buy Cost type, based on the list price of the configuration in the PO Validation Organization.
This cost is the total Rolled up Cost for the configuration.
The cost in the buy cost type will be used in the rollup only if the configuration has a buy type sourcing rule in the assignment set.
If a configuration is procured, but does not have buy type sourcing rules, it will be treated as a manufactured item for the purposes of cost rollup
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Setups and Processes
Define Costs
Define items, BOM, routings
Setup valuation costs for Components and Subassemblies.
Define buy cost type
Setup MRP sourcing rules
Define sourcing rules
Assign sourcing rules to Assignment Set
Set up Profile Options
Run CTO Cost Rollup Program
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Setups and Processes
BOM: CTO Perform Cost Rollup
BOM: CTO Buy Cost type
BOM: Match to Existing Configurations
MRP: Default Assignment Set
BOM: Send Notifications for Autocreate Config Exceptions
BOM: CTO Perform List Price and Purchase Price Rollup
Profile Options
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Scenarios
Case 1: Make Configurations
Case 2: Pre-Configurations
Case 3: Buy Configurations
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Scenarios
Case 1: Make Configurations
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Make Configurations Model Bill
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Make Configurations Setup items (Model)
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Make Configurations
Setup items (Model)
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Make Configurations Setup items (Option Classes )
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Make Configurations Setup items (Option Classes )
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Make Configurations Model Bills Setup
Has two option classes under it. Each option class has two optional items.
Option class one has two procured optional items under it.
Option Class two has two Sub Assembly items under it.
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Option Class Bills Setup
Option Class1 have two procured components. Optional check box Is checked. Similarly option Class2 BOM is also set with two optional Sub-assemblies.
Make Configurations
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Make Configurations Item Costs setup for components and subassemblies
Before performing Cost rollup, ensure all components under Model should have item cost defined in Valuation (Frozen) cost type .
Cost of Sub-Assemblies also needs to be rolled up and updated in frozen cost type since CTO cost rollup process will perform only single level rollup..
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Make Configurations Process Flow Create Sales Order
Enter sales order header and line details.
For a model item, Click on Configurator Button to invoke configurator
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Make Configurations Process Flow Configure using Oracle Configurator
In the configurator window, after Choosing appropriate Components, Click Finish button to complete configuration.
In this case the option items under option class chosen are highlighted
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Make Configurations Process Flow Book Sales Order
Once configuration is complete , Option Items chosen during configuration are copied into the sales order line
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Make Configurations Process Flow Progress Sales Order
Actions(N)-> Progress Order Next step is to progress the model line to Create Configuration. Upon completion of this process, The configured item gets created and new line is inserted to Sales order line.
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Make Configurations Process Flow Newly Created Configuration Item
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Make Configurations Process Flow Configuration Item
Configuration Item (star Item), Configuration BOM and other related entities are created by Auto Create configuration process. Configured Item : Make_Model*381006 Base Model: Make Model
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Make Configurations Process Flow Configuration Item BOM
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Make Configurations Cost Rollup Configuration Item cost details
Cost rollup is performed by auto create configuration process, since profile option BOM: CTO Perform Cost rollup is set to Yes.
The cost is rolled up in CTO cost type by adding up the valuation costs of all the components in the configuration BOM for which Include in cost rollup flag is set to Yes.
In standard costing org, the cost in CTO cost type is copied to Frozen cost type.
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Make Configurations Cost Rollup Summary
Configured Item Make_Model*381006 Created with highlighted Components from Base Model
Cost of Configured Item (Make_Model*381006) Material ( 10 + 7.7+5.5) = 23.2 Resource ( 10 + 5) = 15 Total Item Cost = 23.2 + 15 = 38.2
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Cost Rollup Scenarios
Case2: Pre-Configurations
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Pre-Configurations Model Structure
Create Pre-configuration from the Base Model
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Pre-Configurations - Setup
Setup items (Preconfigured Item)
Create a new item in the master organization and assign it to the appropriate manufacturing organization. Enter the base model item (on which the pre- configured item is configured) in the Base Model field on the BOM tab of the item master for the pre-configured item.
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Pre-Configurations Process Flow Preconfigured Item Bill
Steps to Create Pre-Config BOM Create a new bill of material for your item, without components. Place your cursor in the Components region. From the Tools menu, choose Configure Bill.
A New Configurator Screen will open
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Pre-Configurations Process Flow Pre-configuration in Configurator
Configurator window is launched from BOM. After Choosing appropriate Components, Click Finish button to complete configuration.
In this case the components chosen are highlighted
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Pre-Configurations Process Flow Bill for completed Pre-Configuration
Once configuration is complete , Option Items chosen during configuration process in configurator are inserted in BOM accordingly, and completes Configuration BOM.
This process also creates
respective routings if there are any for Model / Sub Models
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Pre-Configurations Process Flow Pre-Configured item cost before rollup
Pre-Configured Item cost is zero in both CTO and Frozen cost types since CTO cost rollup was not done.
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Pre-Configurations Process Flow Run CTO cost rollup
Profile option BOM: CTO Perform Cost rollup is set to Yes and this has no impact , as it is applicable for configurations created from sales orders
Run CTO Calculate Cost rollup from BOM responsibility
Choose configuration and created days ago request parameter.
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Pre-Configurations Item Cost Details Pre-Configuration Item cost details
Cost is rolled up in CTO cost type by adding up the valuation costs of all the components in the configuration BOM for which Include in cost rollup flag is set to Yes.
buy cost type does not have any cost since Pre-configuration is a make configuration.
The cost in CTO cost type is copied to Frozen cost type.
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Pre-Configurations Cost Rollup Summary
Pre Configured Item Make_PreConfig Created with highlighted Components from Base Model
Cost of Pre-Configured Item (Make_PreConfig) Material ( 15 + 7.7+6.6) = 29.3 Resource ( 10 + 5) = 15 Total Item Cost = 29.3 + 15 = 44.3
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Cost Rollup Scenarios
Case3: Buy Configurations
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Buy-Configurations
Model Bill
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Buy Configurations - Setup Setup items (Model)
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Buy Configurations - Setup
Setup items (Model)
Under General Planning tab ensure the Make or Buy attribute value is set to Buy
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Buy Configurations - Setup Setup items (Option Class )
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Buy Configurations - Setup Model and Option Class Bill
Model Bill contains two option classes under it.
Each option class have two optional purchased items.
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Buy Configurations - Setup Sourcing Rule creation and assignment
Sourcing rule is created with Buy from sourcing type and assigned It to Assignment set for the Buy model.
If a configuration is procured, but does not have buy type sourcing rules, it will be treated as a manufactured item for the purposes of cost rollup
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Buy Configurations - Setup Profiles Set up applicable for buy configuration
Procured configuration item should have a buy type sourcing rule in the assignment set defined by MRP: Default sourcing Assignment Set.
For Buy item, an entry will be created in the cost type specified in the profile BOM: CTO Buy Cost type, based on the list price of the configuration in the PO Validation Organization.
This cost is the total Rolled up Cost for the buy configuration
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Buy Configurations- Setup Component Costs
Item cost is not set for any components under of Buy Model since this configuration is procured and the cost is rolled from list prices of components.
Also Based on Rollup flag needs to be manually checked for Buy_Model since by default it will be unchecked.
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Buy Configurations - Setup Component List Price
Similarly list price is set in item validation organization for other two components
- Buy_OC2_Comp1 : 30 - Buy_OC2_Comp 2 : 35
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Buy Configurations Process Flow Create Sales Order
Create sales order for Base Buy Model and click on configurator button.
This action will invoke configurator if the sales order line is against a Model item.
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Buy Configurations Process Flow Configurator Choosing the options
Choose the appropriate Components, Click Finish button to complete configuration.
In this case the components chosen are highlighted
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Buy Configurations Process Flow Book and Progress Sales order
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Buy Configurations Process Flow
Configuration Item Created
Configured Item Buy_Model*381980 Is created from base model (Buy_Model)
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Buy Configurations- Process Flow Configured Item
Configured item is created and its list price is rolled up during auto create configuration process.
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Buy Configurations- Process Flow Configuration Item BOM and sourcing Rules
Configured Item BOM and Sourcing rule created during auto create Configuration process
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Buy Configurations Item Cost Details Configured Item cost details
Cost rollup is performed by auto create configuration process, since profile option BOM: CTO Perform Cost rollup is set to Yes.
An entry is created in the cost type specified in the profile BOM: CTO Buy Cost type, based on the list price of the configuration in the PO Validation Organization.
A single level cost rollup is performed in the CTO cost type, using Buy cost type.
If the organization is using standard costing, the frozen cost of the configuration is updated with the cost rolled up in the CTO cost type
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Buy Configurations Item Cost Details
A single level cost rollup is performed in the CTO cost type, using Buy cost type.
If the organization is using standard costing, the frozen cost of the configuration is updated with the cost rolled up in the CTO cost type
Configured Item cost details
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Buy-Configurations Cost Rollup Summary
Buy Configured Item Buy_Model*381980 Created with highlighted Components from Base Model. List Price and Cost are rolled up.
Cost of Buy-Configured Item (Buy_Model*381980) Material ( 12 + 30) = 42
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References - Troubleshooting CTO Issues
Note 1387196.1 -> Things to do Prior to Logging a Configure to Order (CTO) Service Request or Bug in EBS Release 12
Note 1565190.1 -> Configure to Order (CTO) for a Basic Assemble to Order Item (ATO) for Release 12 [Video]
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Learnt Concepts around CTO Cost Rollup
Basic Setups for Performing CTO Cost Rollup
Demo flows for
Make Configurations
Pre-configurations
Buy Configurations
MOS Notes to troubleshoot CTO related Issues
What we covered today
Summary
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THANK YOU
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