Updating Pending Costs to Frozen Standard Costs
Updating pending costs to Frozen standard costs does the following:
- Updates the existing standard costs with the costs created in the new cost type and creates the resulting adjustment accounting entries.
If you use Work in Process, the cost update revalues discrete job balances, creates accounting adjustments, and prints the adjustments along with the new job values in its report.
- Creates item cost history.
- Prints the Inventory, Intransit, and WIP Standard Cost Adjustment reports that detail the valuation changes in your inventory due to the change in the standard costs.
- If you share costs across inventory organizations, the standard cost update automatically revalues the on-hand balances in all organizations that share costs.
Oracle recommends that you also print the Cost Type Comparison Reports to display differences in item costs for any two cost types. You can compare by cost element, activity, sub-element, department, this/previous level, or operation.
- Optionally, saves update details for rerunning adjustment reports
You can only update standard costs from the master costing organization, which must use standard costing.
The standard cost update is a batch process that can run while you perform normal transactions. Doing so delays accounting transactions until the cost update is complete. (Consider scheduling large-scale cost updates for off hours.) However, if the period close, job close, or general ledger transfer processes are running, the standard cost update is delayed until they are complete.
Because this function changes the frozen standard value of inventory, Oracle recommends that you take appropriate security precautions.
Attention: Cost Management does not update the standard costs of those items for which you do not define a cost. The standard cost is updated to zero only if you define a zero cost for the item.
Prerequisites
To define, update, or delete cost information, the Privilege to Maintain Cost security function must be included as part of the responsibility. See: Cost Management Security Functions.
To update pending costs to Frozen standard costs:
2. In the Parameters window, enter the cost type for the cost update.
The cost update process copies information (a set of costs for items, activities, resources, outside processing, and overhead) in the specified cost type into the Frozen cost type.
This account is used to collect the changes in value to each item, and to automatically generate transactions that adjust your inventory accounts. Your inventory is adjusted by subinventory and elemental cost account. Your discrete work in process is adjusted by job and cost element account. The WIP accounting class defines the adjustment account for your discrete jobs.
4. Select an item range to update the standard costs for:
All items: This is the default.
Based on rollup items: Items that have Based on Rollup turned on in the Frozen cost type.
Category: All items in a category you specify.
Not based on rollup items: Items that have Based on Rollup turned off in the Frozen cost type.
Range of items: Range of items you specify.
Specific item: Specific item you specify.
Zero cost items: Items with zero cost in the Frozen cost type.
5. Select a sort option for the adjustment reports: by category then item, by item, or by subinventory then item (default).
6. If you selected All Items for Item Range, select an update option: either Overhead, resource, activity, and item costs, or Resource, overhead, and item costs.
7. If you selected Specific item in the Item Range field, enter the specific item to include in the cost update.
8. If you selected Category in the Item Range field, do one of the following:
- Enter the category set to include in the cost update. The default is the category set defined for the costing functional area.
- Enter a specific category.
9. If you selected Range of items in the Item Range field, enter values for Item From and Item To. Standard costs are updated for all items in this range, inclusive.
You can purge standard cost history to delete these details.
See Also
Updating Standard Costs
Submitting a Request
Purging Standard Cost Update History
Defining Items
Cost Management Security Functions
