We have GL Accounts that are capturing the Variance Material and Variance Material Burden/Rounding. Issue I have is that I dont know WHAT entries are posting to here and why. When I look at the TranGLC for the GL’s in question i can see all the Debits and Credits but there are no details showing whats posting and why. Reason this came up is last month we did a manual job and we didnt backflush at time of completion. The Job was done and parts moved however the value was still in the old part. 5 days later at EOM when the Controller did Capture COS/WIP and rolled everything it pulled the value from the old parts to the new parts from the job. This all posted to teh Variance Account and we took a $170k to our bottom line because of it. How can i look at this account each month and see whats posting, from where and why? This is all DEBIT without an offsetting Credit hitting the P&L so we just look bad from it. Why??
run the WIP Recon report for specific GL accounts or specific Jobs for a time period to get the details of what is happening.
Thanks Tim. The other idea I wish we could have is to book something somewhere with a reason so that when we look back on this variance say in 3 months… we have a record of what caused it. You know what I’m trying to get at? A lot of times we look into something at the time it comes up, and then forget about it a month later because of all the other things we are doing. It’d be nice to give a “root cause” to the variance and then be able to roll up all the root causes at the end of the year, even if those root causes are “improper transactions made in ERP,” it’d still be great to get a summation of all the root causes.
Awesome at least this leads me down the rabbit hole of finding out what transactions are hitting these gl’s so i can see why. question - this is hitting our P&L in a way that if we move parts/jobs around and the cost doesn’t follow, no backflush, when they roll the EOM on the last day it rolls the costs forward. It hits our P&L negatively however there is no offset account. What would be the offset account here?? SHould this even post to the p&l like this since its not a change in value but more of just a timing matter of applying cost/burden to the end item from the component items
In theory you could do this by applying a job adjustment, which (if I am remembering correctly) can have a reason code, which will push the adjustment to a specific GL account with the reason. That would adjust the job so that there would not be a “random” variance but moves the variance to another reasoned account. (I hope i am right with my memory).
THere is always an offset account… but to find it, you might need to look at the entire job in the report rather than just one account. In this case, the offset account might be the WIP account, but as I am not seeing the transaction types, I would not know for sure.
Tim, right or wrong, I always appreciate the reply- I’ll look into how that may work.
its all Purge WIP to Variance entries. Is there a way to capture the jobs that completed without Backflush before we do this so we can apply it correctly? Our Controller runs the Capture on the last day and this is whats forcing it all forward but then we take the financial hit. Nov alone we have $180k hit of Var and Var Burden from this and I’ve been explaining to everyone it was a 5 day delay to apply the costs over, no change in value.
Hi @pmazik. We have been having our own issue with the posting of purchasing price variances, so your topic caught my attention. Do you or your controller have the various transaction hierarchy guides for reference, particularly the Inventory
Transaction Hierarchy Guide in this case? That will tell you where to look in your GL Control Code setups to determine your offset account(s).
You could write a SQL query and check what has been issued to a job. If the quantity is wrong then flag it up.
From memory cost are only posted when you run the COS/WIP process. I think, as someone else has stated, you can run the capture COS/WIP report that will tell you what the impact will be on the accounts before posting the accounts. Less helpful but parttran with trancode MFG-VAR will tell you what jobs did the posting (not so good at finding where the costs went and I cannot remember without talking to accountants where the GL tables are that record the GL movements)