Last updated on OCTOBER 06, 2015
Applies to:Oracle Process Manufacturing Financials - Version 12.2.4 and later
Information in this document applies to any platform.
The test case includes setup, transactions, costing and accounting information about Consigned Inventory for Asset Items in actual cost process.
Consignment is a business practice whereby the supplier and buying organization agree that items will be delivered to the buying organization but the supplier will not send an invoice (and thus no payment will be made) until the items have actually been consumed. Consumption normally occurs when the items are used up in WIP or are sold by the buying organization but other scenarios are possible. When consigned goods are received, the normal accounting transactions are NOT effected. From a business perspective this means that the supplier is temporarily storing these goods in the buying organization’s warehouse. The supplier’s liability is not affected and the buying organization’s material asset accounts are also not affected until the items are consumed. At this point, the normal accounting transactions are fired as if the items were received at the time of consumption.
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