Reconcile Physical with WIP


This is coming from someone without any experience with mfg but still interested.

So the Job says you used 500lbs and scrapped 50lbs, it is still open and 150lbs are unaccounted in the system?

Does the system creates a PartTran for 500 and another for 50?, not sure if there is a type for scrap, as mostly in finance I’m only somewhat aware of the million AAA-BBB transaction types in the system.

Can you not mark those 150lbs as also scrap somehow? The system sounds complex enough, just trying to provide some simplistic outside perspective, hope it helps.

in MES, you have the option to complete and scrap qty at the same time… Job for 100, complete 95, scrap 10: will consume inventory for 105 pieces, but only pass on 95 to the next operation. the cost is buried into the cost of the Job. when you complete the job, the extra cost either becomes Variance (in standard cost), or becomes part of the finished cost (average, lot, or make direct). The cost is not “lost” because it WILL be accounted for. The Scrap qty is simply for reporting so that you consume the correct material and are notified why you didn’t get the full amount wanted. If you still need 100 pieces, the system would suggest to make 5 more.

You can sort of but you have to figure out how many scrap pieces to report to consume the qty of material you need to consume but because you are reporting the top level part not scrap for a specific material, you will also scrap backflushed material that you may have never used, so for us not an option either. If you could scrap qty for a specific material problems solved.

Can you outline the PartTrans that occur?

Is it like:

TranType  PartNum  TranQty  FromBin  ToBin   Notes (not the ref in WIP Recon)
========  =======  =======  =======  ======  ================================
STK-MTL   PAPER01      700  201      WIP     The "issueing" of the 700 LB roll
STK-MTL   PAPER01      550  201      WIP     The backflush of the Job's Tot Req

Or does the backflush somehow consume 550 LB of the 700 LB from the first tran, and that’s what leaves the 150 LB in “WIP”?

TranType  PartNum  TranQty  FromBin  ToBin   Notes (not the ref in WIP Recon)
========  =======  =======  =======  ======  ================================
STK-MTL   PAPER01      700  201      201     The "issueing" of the 700 LB roll
WIP-VAR   PAPER01      150                   The captured variance from closed job

PartWip table is simply deducted from as qty reports are done taking away from the 700

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Okay … I get it now. Somewhere in this topic I thought you were backflushing. Sorry for dwelling on this incorrect notion.

And your original issue is that the roll with 150 LB is physically in the Production area, and an auditor would question why it was expensed, yet still physically exists?

And for you example trans actions:

  1. Did you mean MFG-VAR? I don’t see a WIP-VAR tran type. Is it special for AMM?

  2. That xxx-VAR tran only includes Job# and tran cost, right? Or does AMM track the actual Part and Qty’s in WIP?

Other way around

  • 700 lbs of PAPER01 issued to a job and in PartWip. It is 10lb paper per parent
  • 55 parents reported equalling 550 lbs withdrawn from PartWIP leaving us 150lbs in PartWip
  • Alas we had a ton of scarp generated and consumed the whole 700 lb roll, but wait Wip Says 150lbs

At this point there are only a few people that know that roll doesn’t physically exist anymore but only as WIP in the system.

But when you complete the job, that phantom 150 LB in WIP gets expensed. Where’s the problem?

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Not complete, but close is when it goes away. But we make to order and jobs can stay open from days to weeks depending on shipping situation. So you go to audit what’s actually on the floor and it becomes pretty much impossible because you can reconcile what shows in WIP with what you physically have. It just creates a lot of confusion, on what is real and what is not.

Maybe using UD fields on the Job or somewhere where it makes sense to enter the qty/reason for the 150lbs in this scenario, and just pull this information in trackers/dashboards?

Or just make the operators return the issued material when they don’t use it. No matter what you do, someone has to tell the system what actually happened. Adding more fields to fill in only makes more work.

But it doesn’t really exist. It was used up in production - like if the scrap is normally 10%, but this run was wonky and had 40% scrap

Ultimately @Banderson is right that if materials are issued and returned correctly and timely then you could just ignore the WIP materials because they should be on a machine or fully consumed. However that is not our reality which is where we have an issue. We are trying to find the balance between the easy button and training. It’s becoming increasingly more difficult to find talent and keep floor employee turnover low. COVID shutdowns has exacerbated this issue making our material issue a more prevalent one at this time.

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yes it does

The excess materials are never going to be returned to inventory.

  • the excess materials (150lbs) were consumed/scrapped
  • the cost of that excess material - in the production should bourne by the job
  • doing nothing should address take care of that cost

as far as the WIP inventory balance, after the job is completed but before it is closed.

  • I believe it may be possible to use job cost adjustment/material and correct the material WIP qty to zero, so that the WIP properly shows 0 lbs in location.

i’ll give it a try when i get a chance.

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While it does account for all the material, it unfairly burdens this job because it happened to be the one that last left that unusable qty. like if there was 2000 lb on a new roll, and job A needs 1300, and job B needs 500, you’re going to end up with 200 left over regardless of the order. Why penalize the efficiency of job B just because it was 2nd.

Returning the material, then scrapping it, doesn’t penalize either job.

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Yeah… there is a lot of that in our setup, we have accepted the fact that, that is unhandleable in Epicor without some significant work.

(Slight edit, yes yes you can use Job Batching but it’s cumbersome and inflexible sometimes you just don’t get a choice how things play out, you gotta get jobs out the door.)

I didn’t mean to say that the last job eats the unusable roll qty. (tough luck being last :slight_smile: )

i meant to say, if the nature of production is that sometimes the material is consumed in greater qty then expected, but leaves a phantom qty remaining in WIP,
then i suggested to use a job adjustment to remove the ‘phantom wip balance’
and if there is actually a small physical qty left, then return it to stock - so it can be scrapped.

Eg. the roll was 700lbs, and lets say it cost $10/lb - which totals $7000 cost

the job called for 550lbs - but USED 120lbs more during production
and there was a scrap roll of 30lbs.

well the typical 550lbs $5500 cost as well as the extra cost of 120lbs -$1200 - .must be included in the job cost. Which it will.
And The job adjustment can remove the 120LB QTY from WIP without removing the cost.

Then a Material Return from WIP of the remaining actual 30lbs - $300 cost - can goto back to inventory and will NOT be posted to the job.

that is what i meant.
(and yeah, it does seem to be a lot of stuff for not too much in return)

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