Ibis Ostendo FAQ Knowledebase

These are the general ledger transactions posted by Ostendo for Manufacturing (Assembly) transactions. In Ostendo all manufacturing whether discrete, process or custom is called "Assembly"

Assembly Purchases

Purchases to assembly orders are receipted and at the same time issued to the assembly order. The Inventory or Cost of Sales account is therefore debited by the purchase receipt and then credited by the issue to the assembly order, which cancel each other out. The actual cost of the purchase receipt and assembly order issue is in Assembly Work in Progress which is debited by the issue to the assembly order.

Assembly Order Issues

These are issues of costs to the assembly order which may be from inventory in stock, non stock items or purchase receipts to the job. Non stock items that are issued directly to the assembly order without a purchase receipt should have a corresponding purchase record in the Cost of Sales. For example, Consumable Recoveries issued to the assembly order as a dollar value should be offset by actual purchases of consumable items as non stock items to another account for Consumable Purchases next to it in the Cost of Sales. The actual cost of Assembly Order Issue transactions is in Assembly Work in Progress until all Finished Goods are receipted into stock.

Assembly Receipts

When finished goods from an assembly order are receipted into stock the costs held in Assembly Work in Progress are credited and Inventory is debited.

Assembly WIP Variance

If costs are issued to an assembly order after all finished goods are receipted into stock, these will accumulate in Assembly Work in Progress. When the assembly order is Closed these are debited into Assembly WIP Variance in the Cost of Sales.

The costs of finished goods is recognised at the time of receipt at either the Planned Cost of the assembly order, the Actual Cost of the Assembly Order, or the Standard Cost of the Item. The risk of using the Actual Cost of the Assembly Order as the receipt cost of finished goods is that this will only include the actual costs currently issued to the assembly order at the time of receipt. It will not include any actual costs issued to the assembly order after the finished goods have been receipted. In many manufacturing environments it is not possible to issue all actual costs to an assembly order before receipting the finished goods into stock.

Assembly Receipt Variance

This only occurs if Standard Costing is used as the inventory valuation method. If the Assembly Receipt Cost varies from the Item Standard Cost the difference is posted to the Assembly Receipt Variance account in Cost of Sales. Inventory Value is updated at the Standard Cost.

Custom configured products are affected differently.

• If the Assembly Order was for a Custom Product and that Product is still in stock then add the Cost to the Stock record
• If the Assembly Order was for a Custom Product and that Product has been withdrawn from stock but has not yet been Invoiced then add the cost to the Sales Order ‘Pick but not invoiced’ record
• If the Assembly Order was for a Custom Product and that Product has been despatched and Invoiced then add the cost to the Sales Order’s COGS

Non Charge Codes

Items that are issued to an assembly order with a non charge code are not debited to Assembly Work in Progress but to the account the non charge code is mapped to. This could be a Cost of Sales Account as in the case with Rework Costs or Non Charge Labour, or it could be an expense account as in the case with Research and Development.

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