Item Attributes

 It describe behavior of the item/characteristics of the item.

 Total around 270 item attributes are applicable in oracle inventory R12.
 Under 270 item attributes 10 of the status attributes and remaining are normal attributes.
 One item attribute is “item status or status code”.

Status attributes
 It describes key functionality of the item
 10 status attributes are in R12 oracle inventory.

S.No. Status attribute name Group name/ Module name

1 Stockable Inventory
2 Transactable Inventory
3 BOM allowed Bills Of Materials (BOM)
4 Build WIP Work In Process (WIP)
5 Purchasable Purchasing
6 Customer orders enabled Order Management (OM)
7 Internal orders enabled OM / Purchasing
8 Invoice enabled Invoicing (AR)
9 Recipe enabled Process Manufacturing Module (OPM)
10 Process execution enabled Process Manufacturing Module (OPM)

Multi Org
  It is a single instance (Server) of oracle application to support any number of organizations to
partition, securing and easily access of the data.
 We use multi-org concept to maintain of the globalization.
 It is the essential concept for any functional consultant in oracle applications.

Basic Multi Org Structure:

(Modules involved: HR, Payroll) it is the highest level in the

Business Group
organization structure. It may be corporate office or head office of
the company.

Ledger (Modules involved: GL, FA)

Legal Entity

Operating Unit (Modules Involved: Purchasing, OM, AP, AR, CM, SC etc.)

Inventory
Organization (Modules Involved: Inventory, BOM, WIP, CST, ENG, MS/MRP etc.)

Business group

it is the highest level in the organization structure.

It may be the corporate office or head office of the company.

Ledger

It is the financial reporting entity to the general ledger.

It is used to maintain the balance sheet and journals.

Mainly it is identified by 4 C’s

1 Currency

2 Calendar (Accounting) It is the financial calendar and used to perform business transaction.

3 Charts of accounts (Account combination) It is the account structure ,the organization uses to
record transactions and maintain financial account balances.
4 Sub ledger accounting method (SLA) It is a common rule-based accounting engine used by
the oracle products that posts accounting entries into Oracle General Ledger.

Legal Entity

It is used for getting legal authorization from Government to submit fiscal report and taxation.

Operating Unit

It is the independent business transaction like purchasing the items from the suppliers, payment to the
suppliers, selling the items to the customer, receive payment from the customers etc.

It may business unit or organization section.

Inventory Organization

It is used to define the item, store the item, check out the on hand quantity, perform counting, receiving
the item, shipping the item etc.

It may be manufacturing plant, ware house, distribution center etc.

Flexfields:
 It is used to customize the multiple subfields or segments in a single field.
 It is an application level/specific.
 Predefined flexi fields are existed in oracle applications. If required, it is allowed to define new
flexi fields.
Flexfields are two types:
1. Key Flexfields (KFF) (account allies, item category, item catalog, sales order, stock locator,
system item)
2. Descriptive Flexfields (DFF)
1. Key Flexfields:
 It is used to customize the key information structure.
 It is used to capture key information.
 These are mandatory fields. It is application level.
 Every KFF is either single structure or multiple structure KFF.
 If it is single structure KFF, It is not allowed to define new structure(s).
 If it is multiple structure KFF, It is allowed to define new structure(s).

2. Descriptive Flexfields:
 It is used to provide additional/extra information about the record.
 These are optional fields. It is application level.
 DFF can identified by slightly bigger than square bracket “[ ]”
  Every DFF is consist the context fields values. The context field values are 2 type’s i.e. global
data elements and local data elements.
 A Global Data Elements value always appears in the block. You use Global Data Elements to
set up global segments that you want to use in every segment structure.
 A Local Data Elements value is not appear in the block. You use Local Data Elements to set
up local segments that you want to use in specific segment structure.
 Around 3550 seeded DFF’s are applicable in Oracle Application.

Transactions

Movement of the items form one place to another place is called Transactions.
In Inventory totally we have Five types of Transactions are available.
1) Miscellaneous Transaction
2) Sub Inventory Transfer
3) Mover Order
4) Inter Organization Transfer
5) Intra Company Transaction

1) Miscellaneous Transaction
 It is used to receive the item or Issue of the Item in the organization through General
Ledger Account Combination.
 These are two types:
i) Miscellaneous Receipt
ii) Miscellaneous Issue.
1. i) Miscellaneous Receipt
 It is used to receive the items into organization through General Ledger Account
Combination.
 It is used for testing of the application.
 It is used to adjust quantity of the item.
 It is used to set the On-Hand Quantity (OHQ) of the item after implementation of the
project.

1.2) Miscellaneous Issue

 It is used to issue the items from inventory organization through General Ledger Account
Combination.
 It is used to test the application.
 It is used to perform advisements.

2) Sub inventory Transfer

 It is use to transfer the items from one sub-inventory to other sub-inventory without
document reference number and approval with-in same organization.
Inventory Organization
Ex:

Sub inventory 1 Sub inventory 2

Items

3) Move Order Transactions

Inventory Organization

Document reference number and approval

Sub inventory 1 Sub inventory 2

 It is used to transfer the items from on sub inventory to another sub inventory in the same
organization with document reference number and approval.
 The destination sub inventory person will be requesting the item(s).

Move order Cycle

Three steps are involved in move order cycle
1) Create move order
2) Approve move order
3) Transact move order
Types of Move orders:
Four types of move order are available in inventory.
i. Move order Requisition
ii. Move order Replenishment
iii. Pick wave Move order
iv. Manufacturing Component Pick.
 Move order are organization specific.
 We can able to create manually, only move order requisition type.
 The system automatically creating remaining all of the move order types (2, 3 and 4). We can’t
create those types of move orders manually.
Inter organization transfer (IO transfer): One organization to another
organization

Operating Unit

Inventory Org 1 Items Inventory Org 2 Items Inventory Org 3

1) It is used to transfer the items from one inventory organization to other organization with in the
operating unit.
2) These are two types
a. Direct organization transfer.
b. In-tangent shipment.
i. In-tangent shipment without ISO.
ii. In-tangent shipment with ISO.

Direct Organization transfer

1) It is used to transfer the items from one inventory organization to other inventory organization
with in operating unit without document number (No Approval).
2) It is used for when transportation need time is not significant.
3) It is not required separately receive the items into destination organization.
4) It is not possible to request the items through system.

Inventory Controls (or) Item Controls

 It is used to perform transactions with conditions/restrictions.
 We can not able to adopt inventory controls, once on hand quantity is existed.
These are 4 types
1. Locator Control
2. Revision Control
3. Lot Control
4.
5. Serial Control
 1. Locator Control
 It is used to track where the item is exactly lying into sub inventory of the organization.
 Normally, we can use the locator control for small size items.
 We maintain locator control at 3 levels
i. Organization Level
ii. Subinventory Level
iii. Item Level
 Two types of locator control options are applicable
i. Prespecified:
1. We should define locator values before using or before perform
transactions.
ii. Dynamic Entry:
1. It is not required define locator values before using or before perform transactions.
2. We can enter locator values dynamically while performing transactions.

2. Revision Control/Version Control:

 It is used to tracking modified of the item.

3. Lot Control/Lot Number Control:

 It is used to track bulk quantity/large volume quantity of the item(s).
4. Serial Control/Serial Number Control:
 It is used to track individual quantity/ individual pieces of the item(s).
 Normally we can use for warranty items, service products, equipment/machinery items,
costly items etc.
 Each individual quantity of item is applicable unique number for transaction.

Inventory Costing (or) Cost Management Module

 It is used to define/calculate the inventory/unit cost of the item.
 It is used to calculate extended value or total inventory value of the item(s).
 It is one of supporting module in oracle applications.

Oracle Costing Methods:

Basically these are 2 types:
 1. Perpetual Costing Method (Mandatory)
2. Periodic Costing Method (Optional)
Perpetual Costing Methods Periodic Costing Methods
Standard Periodic Average Costing (PAC)
Average Periodic Incremental LIFO
FIFO (First In First Out)
LIFO (Last In First Out)
Note 1: Oracle maintains the perpetual system and periodic system separately and produces
separate reports.
Note 2: In our course, we will discuss only perpetual costing methods.

Theory of Costing Method:

Standard Costing:
 The item cost is static or fixed.
 Manually define the item cost.
 The item cost won’t be updated when receive and issue quantity of the item(s).
 Purchase Price Variance account is required.
 Cost Variance account is not required.
Average Costing:
 The item cost is variable.
 The system automatically calculated the item cost.
 The item cost will be updated when receive quantity of the item(s).
 The item cost won’t be updated when issue quantity of the item(s).
 Purchase Price Variance account is optional.
 Cost Variance account is required.
FIFO Costing:
 The item cost is variable and it is layer costing method.
 The system automatically calculated the item cost.
 Whatever received the items first, those items will be issued first.
 The item cost will be updated when receive and issue quantity of the item(s).
 Purchase Price Variance account is optional.
 Cost Variance account is required.
LIFO Costing:
 The item cost is variable and it is layer costing method.
 The system automatically calculated the item cost.
 Whatever received the items last, those items will be issued first.
 The item cost will be updated when receive and issue quantity of the item(s).
 Purchase Price Variance account is optional.
  Cost Variance account is required.

Table:

Costing Method Inventory Valuation Purchase Price Cost Variance

Accounts Variance Account Account
Standard Only Material Account Required/Mandatory Optional
Is Required/Mandatory
Average All of the Accounts are Optional Required/Mandatory
required/mandatory
FIFO/LIFO All of the accounts are Optional Required/Mandatory
required/mandatory

Cost Elements:
1. Material
2. Material Overhead
3. Resource
4. Overhead
5. Outside Processing (OSP)
Note: Cost elements are seeded/predefined values in Oracle Applications. It is not required to define.
1. Material: It is used to record purchasing price of the item.
2. Material Overhead: It is used to record material handling cost, transport cost, insurance cost
and tax amount etc.
3. Resource: It is used to record direct labor (man power) cost for manufacturing of the item.
4. Overhead (Department, Resource and Others): It is used to record power cost to running of the
machines, labor’s OT cost, document cost etc.
5. Outside Processing: It is used to record outside operation cost of the manufacturing item.
Cost Sub-elements:
1. Material
2. Material Overhead
3. Resource
4. Overhead
5. Outside Processing
Note: Cost subelements are user defined values in Oracle Applications. So, it’s required to define setups.
1. Material: It is used to record special packing cost of the item when purchasing.
2. Material Overhead: It is used to record special transport cost etc.
3. Resource: It is used to record indirect labor (man power) cost for shop floor cleaning etc.
4. Overhead (Department, Resource and Others): It is used to record grease cost to running of the
machines, document printing cost etc.
 5. Outside Processing: It is used to record transport cost of the manufacturing the item when send
it to outside for outside operation etc.
Types of items in costing point of view:
1. Buy
2. Make
Buy Item:
 It is raw material which have purchasing or buying from the supplier
 Material and Material Overheads are applicable.
 Resource, Overhead and Outside Processing are not applicable.
Make Item:
 It is assembly item which have manufacturing into shop floor.
 Material, Material Overhead, Resource, Overhead and Outside Processing are applicable.
 Outside Processing is optional.

Counting Methods (or) Accuracy Methods

 It is used to verify System quantity and actual quantity of the items. If any differences are
existed , we can perform adjustments.
 These are three types
1. Physical Inventory Counting
2. Cycle Counting
3. Replenishment Counting
1. Physical Inventory Counting
 It is used to verify system quantity and actual quantity of the all items through Inventory
Organization and sub inventory wise.
 Normally we can perform this counting yearly once or twise.
 We can use this counting for Asset item s.
 Manually perform adjustments.
2. Cycle Counting
 It is used to verify system quantity and actual quantity of invidual items
 Perform adjustments , if any modifications are existed
 It is the periodic counting of individual items throughout cycle counting
 It can be used for asset itmes
 The system automatically perform adjustments
 It is used to regular counting of items.
 It consists two sections
 1. ABC Analysis
2. Cycle Counting.
Note: we can perform both Physical Inventory and Cycle Counting to an item side by side.

3. Replenishment Counting
 It is not only counting . it is the combination of counting and planning
 Especially we will perform this counting for expense items.
Differences Between Physical inventory counting and cycle counting
Physical inventory counting Cycle counting
1. Perform counting for all the items 1. Perform coun ting for individual items
2. Perform counting for yearly once or 2. Perform counting for any number of
twice times ia an year(periodic counting)
3. Audicting purpose used fro Physical 3. It is used for regular purtpose
inventory
4. Snapshot is applicable 4. Snapshot is not applicable
5. Manually perform adjustments 5. System automatically nperform
adjustments
6. Recounting is not applicable 6. Recounting is applicable
7. Scheduling is not applicable 7. Scheduling is applicable
8. ABC analysis is not required 8. ABC analysis is required
 Types of Receipts :-

1 Blind receiving
2 allow substitute receipt
3 Express receipt
4 Unorder receipt
5 Cascade receipt

O2C- refers to the set of business process for receiving and processing customer sales order for goods
and services and their payments.

order to cash process steps can be listed as below

1 Enter the Sales Order

2 Book the Sales Order

3 Launch Pick Release

4 Ship Confirm
 5 Create Invoice

6 Create the Receipts

7 Transfer to General Ledger

8 Journal Import

9 Posting

1 Enter the Sales Order

Enter the Customer details (Ship to and Bill to address), Order type.

Click on Lines Tab. Enter the Item to be ordered and the quantity required

Now the Sales Order Line Status will be Entered.

2 Book the Sales Order

Click the Book Order button to Book the order.  Now the Sales Order Header wiil be Bokked
and Line Status will be Awaiting Shipping.

3 Launch Pick Release

Go to Shipping 
In the Order tab, enter the Order Number
In the Shipping Tab

Auto Create Delivery: Yes

Auto Pick Confirm: Yes

Auto Pack Delivery: Yes

In the Inventory Tab:

Auto Allocate: Yes

Click on Execute Now Button.

Pick Release process in turn will kick off several other requests like Pick Slip Report,
Shipping Exception Report and Auto Pack Report

4 Ship Confirm

Go to Shipping  Transactions
Enter the Order Number
The Line Status will be Staged/Pick Confirmed
Go to Delivery tab and click the Ship Confirm button.
Now, you can see the Line Status as Shipped.

5 Create Invoice

Run workflow background Process.

and spawns Auto invoice Master Program and Auto invoice import program which creates Invoice for
that particular Order.

The Invoice created can be seen using the Receivables responsibility

6 Create the Receipts

7 Transfer to General Ledger

To transfer the Receivables accounting information to general ledger, run General Ledger Transfer
Program.

8 Journal Import

To transfer the data from General Ledger Interface table to General Ledger, run the Journal Import
program from Oracle General Ledger.

9 Posting

We have to Post journal batches that we have imported previously to update the account balances
in General Ledger.

Navigation: General Ledger> Journals > Enter

Query for the unposted journals for a specific period

From the list of unposted journals displayed, select one journal at a time and click on Post button to post
the journal.