Setting Up Reconciliation

The design of the material usage reconciliation feature is based on the following assumptions:

• Only items that have actually been shipped, depleted, and received are evaluated in the reconciliation process.

  Reconciliation works with actual quantities shipped rather than with requested quantities.

• When a replenishment request is created through a direct issue, requisition, or par location replenishment, the location must be specified on the request to be considered in the reconciliation process.

• Only items that are selected for reconciliation at the par location level, the business unit level, or the SetID level are included in usage history and reconciliation processing.

  To identify whether an item should be reconciled, the system first checks the reconciliation flag at the par location. If the item is not defined for a par location, the system checks the reconciliation flag for the item at the business unit level. If the item has not been defined for the business unit, the reconciliation flag for the item at the SetID level determines whether the item is reconciled.

• All dispensing quantities are in the standard UOM specified for the item.

  The system assumes that the standard UOM is the smallest UOM.

• A charge code must be assigned to each item in the PeopleSoft item master database.

  However, the design of the material usage and reconciliation feature assumes that charge codes and associated pricing structures are maintained in a third-party consumer billing or cost accounting system.

Material charge information is defined at the SetID, business unit, and par location levels. Items in both par and internal locations are available for reconciliation if they are defined as needing reconciliation at either the SetID or the par location level.

Values defined for the item at the SetID level become the default values at the business unit level. Based on the replenishment option, values defined at the business unit level or SetID level become default values at the par location level. If the item is replenished as stock, the default values come from business unit attributes. If the item is replenished as stockless, non-stock, or non-replenished, the default values come from SetID attributes. These attributes can also be overridden for each par location.

The par location is the defining entity for reconciliation setup information for par location items. Therefore, if the item attributes at the SetID level are modified after setting up par locations, the changes do not cascade to the par location level. If the item is not associated with a par location, attributes at the business unit level or SetID item level are the defining values.

Material usage reconciliation setup information at the SetID, business unit, and par location levels consists of the following fields and options.

Selecting a Usage Tracking Method

Setup includes the following fields and options:

• Available values are Billing, Costing, and None.

• Items tracked for billing or costing purposes must have a charge code assigned.

• Items tracked for billing or costing purposes that are also replenished to the par location (Not Replenished check box not selected on the Define Par Location Groups page and Define Par Location - Line page) must be counted (Count Required check box selected on the Define Par Location Groups page).

• Only items tracked for billing or costing are reconciled.

Assigning Charge Codes

Setup includes the following fields and options:

• These codes identify pricing for an item or class of items.

  Charge codes are for informational purposes only and can be used to assist you in consumer billing. This internal code is set up on the Charge Codes page.

• Par location item charge code default values are derived from the Define Par Location - Line page.

  Internal location item charge code default values are derived from the Define Business Unit Item - General: Usage page.

• Items not defined at the business unit level are derived from the Define Item - General: Usage page.

Using the Reconciliation Check Box

Setup includes the following fields and options:

• This option identifies whether items should be included in the material usage reconciliation of the par location, and thus reconciled.

• If this check box is selected for an item, the UOM used for the item must be the standard UOM defined for the item on the Define Item - General: Common page.

  The default status of the check box is clear.

• Only items tracked for billing or costing are reconciled.

  Reconciled items replenished to their par location (Not Replenished check box not selected on the Define Par Location Groups page and Define Par Location - Line page) must be set up with a replenishment control option of Par or Min/Max on the Define Par Location - Line page.

  Note:

  For par location reconciled items, the Reconciliation check box should be clear when you initially stock an item in a par location. Once the par location is stocked, theReconciliation check box should be selected manually and the item reconciled as the stock is used, issued, or purchased for the par location. If the Reconciliation check box is selected for the initial stocking of the item, the reconciliation data for this item in the par location is inaccurate.

Assigning Charge Markup Percentages and Amounts

These charge markups are supported at the SetID-item level and the business unit-item level as a percentage or as a flat markup amount and are used as default values at the par location level.

Selecting Par Replenishment Options

Options include the following:

• Available options are Stock, Stockless, Non-Stock, and Not Replenished.

• The Not Replenished option can be applied to items that require unique usage tracking attributes but are not replenished to the par location.

  The Create Par Replenishment Requests process ignores items that are not replenished.

• The Not Replenished check box at the par location header level controls replenishment of the entire par location.

  If the check box is selected, the entire par location is not replenished, regardless of the item-level replenishment settings. If the check box is clear, replenishment is driven based on the replenishment option defined for each item in the par location. If the item-level replenishment option is defined as Not Replenished, that particular item is not replenished. This check box does not alter the characteristics or definition of the par location in any way.

Setting Replenishment Controls

Options include the following:

• Available options are Par, Fixed Order Quantity (FOQ), and Min/Max.

• Items reconciled and replenished to the par location must be set up with a replenishment control method of Par or Min/Max.

• The replenishment control method of FOQ does not produce accurate reconciliation results, because it does not replenish the item based on what is used.

  This method always orders more than what was used and may cause misleading reconciliation results.