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Hi!

I was reading some post about valuate stocks at actual cost at Period End Closing, and most PPL say the only way to do that is with Material Ledger.

OK, The standard way to do that is activating Material Ledger. The 1st implementation of ML in my country (Peru)  was in 2001. But  there are some oldest implementations 1999 / 2000 in version 4.0  This manufacturing companies want to valuate at actual cost (average monthly) their production. In this days the consultancy create Ztcodes to “calculate” and valuate stocks is this way. sound difficult, but its real, i know 3 companies that did this stuff, i guess there are lot more.

One year ago i have the oportunity to replace the Zcosting in one company implementing Material Ledger. Letme tellyou what this Z do, its quite amazing!

1.  FERT and HALB are valuated at V .. yes, V!

2. Production Order GR is valuated at external value. This external value was a Standard Cost calculated daily, in order  to decrease the price difference between the GR and the theoric cost of the order at settlement (this work if no activity revaluation is done at actual cost)

3. they did activity calculation and production order revaluation.

4. At settlement, the unit cost become a mess, the problem is described in note Note 81682 – Pr.contr.V for semi-finished and finished products

5. They create a Z that do the multilevel exposion (the theoric, not the actual) and based on this explosion calculate the multilevel actual cost.

6. Based on the GI in SD and the stock, calculante the proportional amount that correspond to both.

7. Post FI COGS vs Price Difference

8. MR21 to revaluate (correct) Stocks vs Price Difference. They did the Close the 2nd day of the month, and the Z consider the GM done in the month.

9. The Customer say they try to calculate WIP at actual cost but they never accomplish this requirement.

9. This customer say that their process wasnt 100% accurate, but enough to face their requirement.

Well, this is history because they now have ML active!

Arturo.

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4 Comments

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  1. Big Choi

    I think that z-program had very complicated logic.

    Many company in Korea also developed z-program to calculate actual cost and valuate inventory using it before 4.6C. 

    (0) 

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