Oracle Inventory and Oracle Cost Management provide the required features to effect the necessary period-end procedures to:
§ Reconcile the inventory and work in process costs and values.
§ Transfer inventory and manufacturing costs to the General Ledger.
§ Transfer summary or detail accounting information to the general ledger.
§ Independently open and close periods for each inventory organization.
§ Perform interim transfers to the General Ledger without closing the period.
§ Maintain the same set of periods and fiscal calendar as for the General Ledger.
Attention: For period-end adjustment purposes, it may be appropriate to hold more than one period open per inventory organisation at the same time, although at other times, having only one period open at a time ensures that transactions are correctly dated and posted to the correct accounting period.
The following steps are taken in performing period-end processing for Oracle Inventory:
Complete All Transactions for the Period Being Closed
§ Ensure that all issues, receipts, and adjustments have been entered and verify that no hard copy records exist or are awaiting data entry, e.g. packing slips in receiving.
§ Optional Report - Cycle Count Report
This report will highlight any unconfirmed ad-hoc Stocktakes.
Check Inventory and Work in Process Transaction Interfaces
Check the Interface Managers window to ensure that there are no background or concurrent programs unprocessed.
Check all three selections, Transactions Interface, Internal Transactions, and Demand Interface, and fix any rejected transactions.
The interface managers that need to be run are as follows:
§ Material Transaction Manager
§ Material Cost Transaction
§ Move Transaction Manager
§ Resource Cost Transaction Manager
§ Check the Reservation Managers window
§ Demand Reservation Manager
Check Oracle Order Management Transaction Processes
Ensure all sales order (Pick Release) issues through Oracle Order Management have been completed and transferred successfully to Oracle Inventory.
Attention: If orders have not been released, they do not have to be completed.
Review Inventory Transactions
Before closing a period, review all of the transactions for the period that have a high dollar value and/or a high transaction quantity. Verify that the correct accounts have been charged. Correcting incorrect account charges before closing the period is easier than writing manual journal entries to resolve them later.
Balance the Perpetual Inventory
Check that the perpetual inventory value up to the end of the period being closed matches the value reported in the General Ledger. This balancing is usually effected automatically, but one of the following three sources may create a problem:
§ Other inventory journal entries
Journal entries from products other than Oracle Inventory, that update the inventory accounts.
§ Charges to improper accounts
For example, material issued from a sub-inventory to a miscellaneous account, but one of the sub-inventory accounts was used as that miscellaneous account.
§ Transactions after period end reports
This occurs when the period-end inventory valuation reports are submitted before all transactions for the period have been completed.
Use the Historical Inventory Balance Report to obtain period valuation information before the extra transactions.
The following reports can be run to help with these reviews:
§ Inventory Value Report
Use the Inventory Value Report to show quantity, valuation, and detailed item information for the sub-inventories specified.
§ Period Close Value Summary Report
Use the Period Close Value Summary to see summary balances for sub-inventories. If you run this report for a closed accounting period, the report displays the sub-inventory values at the end of that period. If you run the report for an open period, the report displays the sub-inventory value at the point in time you run the report. You can see more sub-inventory balance detail by running the Inventory Value Report, or the Elemental Inventory Value Report.
§ Material Account Distribution Detail Report
Use the Material Account Distribution Detail Report to view the accounts charged for inventory transactions. Review inventory transaction values transferred to the general ledger by GL batch.
§ Material Account Distribution Summary Report
Use the Material Account Distribution Summary report to review inventory accounting activity. If you detect unusual accounts or amounts, use the Material Account Distribution Detail report to print the transaction in detail.
Use the Material Account Distribution Summary Report to verify inventory account activity against inventory valuation increases or decreases for the accounting period. Finally, use this report to reconcile an account across several periods.