Process over and under transactions

Completed

When a voyage's orders are processed, the system expects the number of items that are received in the final destination warehouse for consumption to match the quantity that's specified on the voyage's purchase order lines. However, because the specified amount on the purchase order lines isn't always received at the warehouse, the Landed cost module has rules for dealing with over-receiving and under-receiving of products. These rules are critical because the initial purchase order has already been invoiced and can't be amended. By defining the over/under transaction policies, you'll enable the system to determine how to handle over and under-processing of goods on receipt. Additionally, you can manually manage over and under inventory by using the Over/under transactions page.

Over/under tolerances

To determine the over and under quantities or volumes that can be processed on a voyage without creating an error, you can set over-delivery and under-delivery tolerances. If the voyage line receipt falls outside of these tolerances, you need to adjust and resolve it before closing the voyage line for additional processing.

Go to Landed cost > Over/under setup > Over/under tolerances to set up the tolerances. On the Over/under tolerances page, you can view, edit, add, and remove tolerance records.

Screenshot of the over/under tolerances page and the various fields available.

View and process over/under transactions

When the quantity of goods put away doesn't match the initialized quantity, over and under transactions will be generated. You should update the quantity in the arrival journal only with the amount that has been put away.

When voyage lines are processed, you can set a vendor's over/under tolerances. Afterward, the items will be examined and validated. You can specify tolerance as a percentage, a local value, or a combination of the two.

If a received item falls within the tolerance, the system will generate a movement journal. On the voyage parameters page, you can specify this journal. An over/under transaction will also be created. For example, if the order value is USD 100.00, and the receipt value is USD 99.00 (both of which satisfy the tolerance standards), then a negative movement journal will be created for the under-received quantity.

If an item is received that is outside of the tolerance, the system will generate an over/under transaction to account for the difference in amount.

Go to Landed cost > Inquiries > Over/under transactions to view and process over/under transactions. On the Over/under transactions page, a transaction will be connected with all over-received or under-received items during a voyage. Therefore, we recommend that you resolve all over/under transactions that are related to voyages by using the Over/under transactions page. Additionally, we recommend that you avoid manually resolving under-delivery warehouse transactions by using movement or counting journals. Instead, it would be best to manage the under-delivery warehouse amounts through the Over/under transactions page.

To view your over/under transactions, go to the Over/under transactions page and select the Overview tab in the upper-right corner.

Screenshot of the over/under transactions page with the various fields available on the general tab.

Process over/under transactions

The Action Pane on the Over/under transactions page contains the following commands for completing the transactions that are selected on the page. Each command allows you to specify how each transaction should be processed.

  • Create > Movement - Create and publish a movement journal for the specified transaction. An automatic movement journal is created and posted for under transactions to reflect the difference between the expected and actual quantity received. Select this command if you want the vendor to realize the cost difference for over transactions.

  • Create > Purchase order - Create a purchase order for the difference between the transaction's expected and actual quantity received. If your company will realize the cost difference, use this command for over transactions.

  • Create > Transfer to destination - This command is only applicable to transfer orders. Select this option if you want to move the over or under quantity to the destination warehouse.

  • Create > Transfer to origin - This command is only applicable to transfer orders. Select this option if you want to move the over or under quantity to the origin warehouse.