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From the Maximo Support Desk - Cost Accounting For A Rotating Asset That Moves Back To The Storeroom

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Abstract

From the Maximo Support Desk - Cost Accounting For A Rotating Asset That Moves Back To The Storeroom

Body

Hey bean counters, this one's for you...

Is the average cost of a rotating asset updated if it is moved from an operating or repair location to a storeroom location?  (Spoiler Alert: YES)

 

It is observed that sometimes the Average Cost of a rotating item changes when the repaired, Rotating Asset is moved back to the Storeroom. This happens regardless of whether the Charge To Store check-box is checked, or whether the UPDATEINVENTORY maxvar is set to 1 or 0.

It's important to note that the context of this article is the rotating item, not an individual asset record; we are talking about the inventory record which has a current balance associated.

Average cost is ALWAYS updated when a Rotating Asset is moved back into the Storeroom. This is an expected and fundamental feature of rotating functionality. The cost accounting scenario of this transaction, (the move of a rotating asset from an operating location to a storeroom location) is described below.

A move asset transaction is used to record a rotating asset being moved from one location to another. A common use is to move a rotating asset from an operating, or repair location to a storeroom. The use case is generally that a rotating asset had been used on a work order and now the work order is complete; therefore the asset is no longer needed at the operating location. The user moves this asset back to the storeroom so that it can be issued again in the future.

 

Summary: three update processes occur when the rotating asset is moved from an operating location to a storeroom location...

  • Write EQTRANS record -Asset Move Transaction – Records asset move into storeroom

Credits the Global Rotating Suspense Account

Debits the Storeroom Control Account
 

  • Write MATRECTRANS record – Material Receipt Transaction

Credits the Global Rotating Suspense Account

Debits the Storeroom Control Account
 

  • Inventory – Updates the Average Cost:

The Inventory Average Cost Calculation is described below.

  • For a Storeroom Receipt via the purchasing process:

(Old Balance * Old Average Cost) + (Receipt Qty * Receipt Cost) / (Old Balance + Receipt Qty)

  • For a Storeroom Receipt via the Move Rotating Asset process:

(Old Balance * Old Average Cost) + (Move Qty * Inventory Cost) / (Old Balance + Move Qty)

 


Tom Richardson is an IBM Maximo Support Engineer and frequent contributor to the Asset Management Blog community.  For a complete index of links to his articles, visit
Index of articles by Tom Richardson, Support Engineer

 

 

 

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ibm11112115