Intercompany Order Processing

Introductions

Brian Clark Joined Logan Consulting in 1997 Equity Partner in the Firm QAD implementation experience since 1997 Manufacturing and Distribution Focus

Why Interco?

International Transactions require an arms-length transaction.

Allows variability between sites for item numbers.

Some intercompany transactions are revenue generating transaction – funds change hands.

Intercompany vs. DRP

Release management similar to customer/supplier process.

Control the pricing/costing element more precisely.

Scales to multiple domains/databases more easily than DRP.

Interco vs. EMT

BuySite

Customer

SellSite

Customer

Customer

Interco EMT

Example

Buying SiteSite: US02

Supplier: IC5000

Selling SiteSite: US01

Customer: IC1000

FG0074

I0042I0007I0002I0007I0002

• Purchased Parts• Schedule Based

• Manufactured Parts• Sold to many customers

COMP3COMP2COMP1

Interco Setup

Selling Site

Buying Site

Create Intercompany

Supplier Records

Create Supplier Intercompany

Price List

Supplier Schedules

created with ERS

activated.

Create Intercompany

Customer Records

Create Customer

Intercompany Price List

Customer Schedules created.

Enable Self-Billing for eachIntercompany

customer.

Interco Setup

Selling Site

Buying Site

Create Intercompany

Supplier Records

Create Intercompany

Customer Records

Enable Self-Billing for eachIntercompany

customer.

- Credit Terms considerations.

- Business Relation/Address conventions.

- Supplier/Customer Type or simplified screens.

- Automation not likely required.

Customer Data

Supplier Data

Interco Setup

Selling Site

Buying Site

Create Supplier Intercompany

Price List

Create Customer

Intercompany Price List

- Determine intercompany pricing policy.

- Synchronization is critical, consider automation.

- Discrete orders require different support.

Price Lists– Scheduled Orders

Interco Setup

Selling Site

Buying Site

Supplier Schedules

created with ERS

activated.

Customer Schedules created.

- Opportunities for 862 & 830 data exchange.

- Monitor using appropriate browses/custom reports.

- Again, synchronization is critical.

- Automation more complicated, but possible.

- Netting logic and CUM adjusts possible.

- Item Replacement possible.

Customer/Supplier Schedule

Processing Orders

Process 830 / 862 against Customer Scheduled

Order (EDI).

Run Required Ship Schedule

Update to generate RSS.

Pick/Ship process

results in shipper.

Confirm Shipper and capture Self-

Billing information.

Material leaves selling

site.

Shipment ASN Export

(35.4.1)

Self-Bill Created for matching invoice or

adjustment

EDI 830/862 transmitted to shipping

site.

EDI 856 transmitted to receiving

site.

EDI 820 imported generates Self-Bills

Run MRP to create

Planned Purchase

Orders

Update from MRP to 830/862 Releases.

Run Supplier Shipping Schedule

Export (35.4.8)

ASN imported into receiving site as a PO

Shipper.

Material arrives at

purchasing site.

Purchasing site processes PO Shipper Receipt.

Run ERS Processor to

generate supplier invoices

Supplier Payment Selection

Create

Supplier Payment Selection Confirm

Supplier Payment Selection Execute(Generates 820)

Self-Bill Confirm

Customer Invoice Paid. AR Cleared

EDI

Selling Site

Buying Site

Processing Orders

Process 830 / 862 against Customer Scheduled

Order (EDI).

Run Required Ship Schedule

Update to generate RSS.

EDI 830/862 transmitted to shipping

site.

Run MRP to create

Planned Purchase

Orders

Update from MRP to 830/862 Releases.

Run Supplier Shipping Schedule

Export (35.4.8)

EDI

Selling Site

Buying Site

- Planning and Shipping Schedules align.

- RSS allows merging per netting logic.

- Standard EDI process on both sides.

- Critical to keep orders in alignment.

- Similar process can be handled for discretes.

FG Forecast

FG Demand

MRP Detail

Update Schedules from MRP

PO_BUYER

Supplier Schedule Release

Customer Schedule Release

Processing Orders

Pick/Ship process

results in shipper.

Confirm Shipper and capture Self-

Billing information.

Material leaves selling

site.

Shipment ASN Export

(35.4.1)

EDI 856 transmitted to receiving

site.

ASN imported into receiving site as a PO

Shipper.

Material arrives at

purchasing site.

Purchasing site processes PO Shipper Receipt.

Run ERS Processor to

generate supplier invoices

EDI

Selling Site

Buying Site

- Pick/Ship process similar to normal orders.

- ASN Export triggers PO Shipper import.

- ERS creates payable records automatically.

- Consider ASN container/lot contents.

- Discrepancy resolution still an issue.

Shipper Workbench

Shipper Confirm

ASN/PO Shipper

PO Shipper Maintenance

PO Shipper Confirm

ERS Processor

six_ref Browse

Processing Payments

Self-Bill Created for matching invoice or

adjustment

EDI 820 imported generates Self-Bills

Supplier Payment Selection

Create

Supplier Payment Selection Confirm

Supplier Payment Selection Execute(Generates 820)

Self-Bill Confirm

Customer Invoice Paid. AR Cleared

EDI

Selling Site

Buying Site

- Timing of payment drives the workload.

- Selection Execute creates the electronic payment file (EE).

- Import of 820 creates the Self-Bill, does not confirm it.

- Reconciliation still a month end event, but with more helpful information.

- Likely need a browse for in-transit PO Shippers for reversing journal entry.

Supplier Dashboard

Supplier Payment Selection

Payment Confirm

Supplier Payment Execute

Supplier Dashboard

Customer Dashboard

Self-Bill Maintenance

Self-Bill Confirm

Customer Dashboard

QAD Modules

QAD Version

Release Management

Self-Billing/ ERS

Shippers vs. Standard Shipping

EE and SE differ from a banking transaction standpoint. Bank Driver approach (820) will be optimal for EE. SE will likely require some development to achieve 820 automation.

Release Management not required for this process, but offers ideal forecast and shipment requirement capability. Spot orders can be handled by discrete orders.

Released in QAD SE version 9.0. Could require some patching in earlier versions of QAD. Good way to begin using Evaluated Receipts Settlement for the first time.

Required for ASN’s and PO Shipper import. Difficult to implement shipment/payment benefits without the use of Shippers.

eCommerceWithout eCommerce, the interfacing would need to be custom extracts/uploads.

Automation

Process 830 / 862 against Customer Scheduled

Order (EDI).

Run Required Ship Schedule

Update to generate RSS.

Pick/Ship process

results in shipper.

Confirm Shipper and capture Self-

Billing information.

Material leaves selling

site.

Shipment ASN Export

(35.4.1)

Self-Bill Created for matching invoice or

adjustment

EDI 830/862 transmitted to shipping

site.

EDI 856 transmitted to receiving

site.

EDI 820 imported generates Self-Bills

Run MRP to create

Planned Purchase

Orders

Update from MRP to 830/862 Releases.

Run Supplier Shipping Schedule

Export (35.4.8)

ASN imported into receiving site as a PO

Shipper.

Material arrives at

purchasing site.

Purchasing site processes PO Shipper Receipt.

Run ERS Processor to

generate supplier invoices

Supplier Payment Selection

Create

Supplier Payment Selection Confirm

Supplier Payment Selection Execute(Generates 820)

Self-Bill Confirm

Customer Invoice Paid. AR Cleared

EDI

Selling Site

Buying Site

Thank You!