Create Receipt Returns for Expense Destination Transfer Orders

When using internal material transfers or transfer orders to replenish consumable goods in your organization, it's common to use expense destination transfers. Expense destination transfers move material from an inventory-tracked location directly to the requester's location for immediate usage, and the on-hand quantity isn't incremented at the destination location. Prior to this release, you couldn't return goods received from an expense destination transfer order. Now, you can create a receipt return for expense destination transfer orders to return material to the source location when you find the material is no longer required. 

Return Transfer Order

This feature allows you to return transfer orders back to the original source inventory organization or source subinventory associated with the transfer order. For example, a transfer order is shipped from inventory organization A to inventory organization B, and the transfer order is received into an expense destination. You can now return the transfer order back to the source inventory organization. When returning the transfer order, you have visibility to the forward flow transfer order for which you are retuning against. Additionally, new inventory transaction types have been introduced allowing you to monitor your return transfer orders.

The following new transaction types have been introduced for the Transfer Order Return transaction source type.

• Transfer Order Return Intraorganization Receipt from Expense
• Transfer Order Return Receipt from Expense
• Transfer Order Expense Return to Receiving (Transaction in Receipt Accounting to reverse the expense)

You can return expense destination transfer orders for both interorganization (organization-to-organization) and intraorganization (subinventory-to-subinventory) internal material transfers.

Review Completed Transactions

You can see all the distributions created for the intraorganization expense destination transfer order flow. In the forward flow on transfer order issue, inventory is credited, and the value is moved to trade in-transit valuation which is reduced on transfer order receipt. An expense is booked on delivery to the expense location. In a similar way, when returning from the expense location, a reversal to the expense is booked and value is debited back to inventory.

Accounting for Intraorganization Transfer Order Returns

You can see all the accounting distributions created for the interorganization expense destination transfer order flow. In the forward flow on transfer order issue, inventory is credited, and the value is moved to trade in-transit valuation. When a transfer order is across profit center business units (PCBU) or within a PCBU, logical events are created to book the due from and due to accounting. When returning from the expense destination, a reversal to the expense is booked followed by a reversal to the due from and due to account, and finally the cost is debited back to inventory. Using similar sources to derive the account for these distributions on return allows for accurate reconciliation of control accounts.

Accounting for Interorganization Transfer Order Returns

This feature provides you better control of the material in your organization and cost savings by allowing you to return internally transferred goods that are no longer required even if they were expensed upon receipt. 

Steps to Enable

You don't need to do anything to enable this feature.

Tips And Considerations

• Physical material return is required when returning expense destination transfer orders.

• Return transfer orders aren’t supported for Brazil and India based inventory organizations.

• Return transfer orders aren’t supported for budgetary controlled or project-based transfer order lines.

• Shipment lines created for transfer order returns from an expense destination are automatically staged and the shipping method isn't enforced.

• Intraorganization returns support automatic ship confirm and manual receipt.

• Interorganization returns require manual ship confirm and manual receipt.

• Return transfer orders aren't supported for expense destination transfer orders when the receipt isn't required.

• Receipt routing is always Direct for expense destination return transfer orders.

• Reversal of the expense for a return is always at the original transfer price at which the receipt was costed.

• For lot and serial number-controlled items, you can enable the Track Lot or Serial Level Costs During Transfers opt-in feature under the Cost Accounting functional area to track the actual costs without averaging for cost-based transfers and actual expense reversals on returns.

• For returns from expense destinations for transfers across profit center business units, the orchestration of financial trade events to take care of the due from and due to accounting happens only after the return receipt event in the original shipping organization.

Key Resources

• Oracle Fusion Cloud SCM: Using Receiving guide, available on the Oracle Help Center.
• Oracle Fusion Cloud SCM: Using Inventory Management guide, available on the Oracle Help Center.
• Oracle Fusion Cloud SCM: Implementing Manufacturing and Supply Chain Materials Management guide, available on the Oracle Help Center.

Access Requirements

Users who are assigned a configured job role that contains these privileges can access this feature:

• Manage Receiving Receipt Returns (RCV_MANAGE_RECEIVING_RECEIPT_RETURNS)
• Create Receiving Receipt by Web Service (RCV_CREATE_RECEIVING_RECEIPT_WEB_SERVICE)
• Manage Shipments and Shipment Lines (WSH_MANAGE_SHIPMENT_AND_SHIPMENT_LINE)
• Manage Inventory Transfer Order (INV_MANAGE_INVENTORY_TRANSFER_ORDER)
• Review Receipt Accounting Distributions (CMR_REVIEW_RECEIPT_ACCOUNTING_DISTRIBUTIONS)
• Review Cost Distribution (CST_REVIEW_COST_DISTRIBUTIONS)
• View Supply Chain Financial Orchestration Flow (FOS_VIEW_SUPPLY_CHAIN_FINANCIAL_TRADE_AGREEMENT)

These privileges were available prior to this update.