Redwood: Create and Edit Overhead Expense Pools Using a New User Experience

Overhead expense pools represent a collection of general ledger expense accounts that can be absorbed as overhead costs into the inventory value and item costs. You can define expense pools at the SET level and use them when creating accounting overhead rules for a cost organization. Expense pools are mapped to a cost element, and a cost element can contain one or more expense pools. When overhead is absorbed, an accounting distribution is created for each expense pool, so you can define accounting rules crediting the absorption account at the expense pool level. 

You can now create, update, and search for overhead expense pools using Redwood pages.
View list of expense pools defined

View list of expense pools defined

Create new Expense Pool

Create new Expense Pool

Some of the benefits of this feature include:

  • Simplified Cost Allocation: Allocating costs using an expense pool method ensures that indirect costs are spread evenly and consistently across items.
  • Cost Transparency: Allocating overhead costs to individual items gives a more comprehensive view of the true cost of production and distribution. This is important for setting prices, managing margins, and assessing profitability.
  • Regulatory Compliance: Overhead expense pools help ensure compliance with regulations around cost allocation.

Steps to Enable

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

Tips And Considerations

  • You can provide guidance such as tutorials, company policies, and best practices in the context of Expense Pools using guided journey tasks. 
  • You can delete an overhead expense pool after it's used in accounting overhead rules. You can deselect the Active option if you no longer want to use an overhead expense pool in new overhead accounting rules.
  • In the Setup and Maintenance work area, the Redwood version of the Overhead Expense Pools page is enabled by default in this update, but the existing version of the Manage Overhead Expense Pools page is still available in the Manufacturing and Supply Chain Materials Management offering. You should move to the Redwood version of the page at your earliest convenience, because the existing version of the page will be removed from the application in a future update.

Key Resources

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

Access Requirements

Users who are assigned a configured job role that contains the following privilege can access this feature:

  • Manage Expense Pools (CST_MANAGE_EXPENSE_POOLS)
  • Manage Expense Pools by Web Service (CST_MANAGE_EXPENSE_POOLS_WEB_SERVICE)