To define project cost groups:You can define and subsequently use project cost groups if the Project Cost Collection Enabled parameter in the Organization Parameters window in Oracle Inventory is set. Project cost groups are used to group project related costs.
Organization's Cost Group
The organization's default cost group is seeded when you install Cost Management. This is a multiple organization (multi - org) cost group and is used as the default in organizations that have a Costing Method of Average and the CST: Average Costing Option profile option set to Inventory and Work in Process. These organizations do not, however, have to have their Project Cost Collection Enabled parameter set.
The valuation accounts defined in the Organization Parameters window are used for this cost group and cannot be changed or made inactive. However, in an organization that is Project Cost Collection Enabled the name and description of this cost group can be changed.
If you assign a project the organization's default cost group, then the project is costed at common inventory costs.
User - Defined Cost Groups
A project must be associated with a project cost group. If you do not specifically assign a project to a user - defined cost group, costs for that project are derived using the organization's default cost group. Project cost groups can have more than one project assigned to them. Project cost groups can be specific to an organization or available in multiple organizations. If a cost group is assigned to projects that are defined in multiple inventory organizations, it must be defined as a multi - org cost group.
Average costs are calculated and held at the cost group level within each inventory organization; since subinventory valuation accounts cannot be defined at a level lower than the level at which average costs are held, value in every locator belonging to a project in a particular cost group is held in that group's valuation accounts.
Through the use of cost groups, an item may have a different cost in different projects as well as a unique cost in common inventory, all within the same organization. Item costs can apply to a single project if each project belongs to a distinct cost group, or apply to a group of projects if all projects in the group are associated to the same project cost group. Items in common inventory belong to the organization's default cost group and are costed separately from items in projects.
You can define and subsequently use project cost groups if the Project Cost Collection Enabled parameter in the Organization Parameters window in Oracle Inventory is set. See: Organization Parameters Window.
For each project cost group, you must define five elemental subinventory valuation accounts, an average cost variance account, and an encumbrance account. You can use different accounts or the same account for all five elemental accounts.
You do not have to use separate accounts to maintain elemental visibility for project related costs. Cost visibility is maintained at the subelemental level through the use of expenditure types. You can associate WIP accounting classes with a project cost group. This association defines which WIP accounting classes are valid for use with the project or projects belonging to this cost group. By restricting the use of a WIP class to only one cost group, you can avoid commingling Work in Process costs for multiple projects into one set of valuation accounts.
To define project cost groups:Navigate to the Cost Groups window.
Enter an alphanumeric name to identify the Cost Group.
Enter a cost group Description.
Enter an Inactive On date.
As of this date, you can no longer assign this project cost group to a project, however, you can query and process records that use it. If you do not enter a Inactive On date, the cost group is valid indefinitely.
Check Multi - Org to indicate that the cost group name can be shared with other organizations.
Note: If not set to Multi - Org, the cost group is only available to the organization that it is created in. If enabled, only the cost group name is shared across organizations.
If the project cost group is to include projects that are defined in multiple inventory organizations, it must be defined as a multi - org cost group.
Enter account numbers:
When you define a cost group for an organization, the accounts defined in the Organization Parameters window appear by default, but you can change them. See: Organization Parameters, Oracle Inventory User's Guide and Defining Costing Information, Oracle Inventory User's Guide See: Organization Parameters and Defining Costing Information.
You can make changes to the cost group accounts within a given organization if:
Material On-hand Quantities contain zero quantity.
Cost Quantity Layers (for non-standard costing organizations) contain zero quantity.
There are no pending material transactions.
There are no uncosted material transactions.
Additional Information: Locators that reference projects that belong to a project cost group use these accounts for inventory valuation. You therefore cannot change an account if there is on - hand inventory in any of the following locators:
Material: A general ledger account to accumulate material costs for this cost group. This is usually an asset account.
Material Overhead: A general ledger account to accumulate material overhead or burden costs for this cost group. This is usually an asset account.
Resource: A general ledger account to accumulate resource costs for this cost group. This is usually an asset account.
Outside Processing: A general ledger account to accumulate outside processing costs for this cost group. This is usually an asset account.
Overhead: A general ledger account to accumulate resource overhead or department overhead costs for this cost group. This is usually an asset account.
Average Cost Variance: A general ledger account to accumulate the balances that may occur when transactions are processed for an item whose on - hand inventory is negative. This account represents the inventory valuation error caused by issuing inventory before receiving it.
Encumbrance: A general ledger account to hold the value of encumbrances against subinventory items.
Borrow Payback Variance Account: A general ledger account that is used to track the difference between the current average cost and the original borrowing cost. This account is mandatory.
To associate WIP accounting classes with the cost group:Choose the WIP Accounting Classes button. The WIP Accounting Classes for Cost Groups window appears.
Select a WIP Accounting Class.
You can only select any Standard Discrete Accounting Class. See: WIP Accounting Classes, Oracle Work in Process User's Guide and Defining WIP Accounting Classes, Oracle Work in Process User's Guide.
Save your work.