1. Implementing Manufacturing and Supply Chain Materials Management
  2. Important Points to Know Before Creating Cost Organization Relationships

Important Points to Know Before Creating Cost Organization Relationships

Go through the points listed here before you start creating cost organization relationships.

  • If you’re unable to associate an inventory organization to the cost organization, then check whether:

    • A Profit Center Business Unit is assigned to the inventory organization.

    • The legal entity of the inventory organization is same as that of the cost organization.

    • The Profit Center Business Unit assigned to the inventory organization is same as that of other inventory organizations already associated with the cost organization.

    • The Below Legal Entity option is enabled in Assign Business Unit Business Function.

    • The inventory organization isn’t already associated with another cost organization.

    • The inventory organizations share the same item master organization.

  • If the required ledger isn’t listed when associating a cost book, then first run the Update Subledger Application Options process from the Scheduled Processes work area.

When you save a cost organization relationship:

  • If not specified, the effective end date for a cost organization-inventory organization relationship defaults to 12/31/12 (MM/DD/YY). In this case, the year is 4712 and not 2012.

  • For each associated cost book, costing internally creates the costing periods from the first opened period onwards. You can’t change the periods after the cost organization relationship is saved.

The restrictions listed here become effective after you create a cost organization relationship:

  • The effective start date for an inventory organization can’t be changed after the relationship is saved.

  • An inventory organization can’t be deleted from the relationship after the cost processor processes a transaction for this inventory organization.

  • An inventory organization can’t be associated with another cost organization after transactions are processed for the existing cost organization - inventory organization combination.

  • Only one ledger can be assigned to a cost book and the ledger can’t be changed after transactions are processed for the cost organization – cost book combination.

  • The effective start date and first opened period for a cost book can’t be changed. If there are any cost processing errors for this period, you need to resolve them.

Note:

  • If no transactions are processed for a cost organization - inventory organization combination, then the inventory organization can be deleted from the relationship and associated with another cost organization.

  • If transactions are processed for a cost organization – cost book combination, then to associate a new ledger, you must first create a new cost book and then associate it with the new ledger in the cost organization relationship.

The effective start date for a cost organization - cost book relationship and the first opened period for the cost book might not match. If the first opened period is later than the effective start date , then all such transactions that are done in the interim period will be costed in the first opened period.

For example, if the effective start date of the cost organization - cost book relationship is 10-Jan-2019 and the first opened period is April 2019, then all transactions from 10-Jan-2019 through 31-March-2019 will be costed in the April 2019 period.