Cyclecountingisaprocessusedtoperiodicallycountselecteditemsintheinventoryto

makesurethattheactualinventorybalancesagreewiththecomputerrecords.Bysetting
upacyclecountingprogram,youcancountpracticallyallitemsintheinventoryovera
periodof12months.Thiseliminatestheneedforanannualphysicalinventory,though
somecompaniesdoboth.IntheOracleInventoryapplication,thecyclecountingprocess
startswithassigninganABCvaluetoeachitem.Thenyouselectthefrequencyofcounts
peryearforeachcategoryofitems.YouwanttocountAclassitemsmoreoftenthanC
classitems.
CountZeroQuantity: Checktogeneratecountrequestsforitemsreflectingazero
onhandquantityonthesystem.Note:Checkingthisby
itselfwillnotgeneratecountsforzeroonhanditems.
Youmustdefineitemsubinventoryrelationshipstoget
acountforzeroonhands.
CycleCountingExecution
Theexecutionofcyclecountingstartswiththeschedulingofthecyclecount.Thiscan
bedonewitheitheranautomaticschedulingprocessoramanualschedulingprocess.
Manualschedulescanbedoneinadditionto,orinsteadofautomaticscheduling.
Manuallyscheduledcountshavenoimpactonautomaticallyscheduledcounts;youcan
potentiallycountsomeitemsmorefrequentlythanwhatyouinitiallyplanned.
Thenextstepistogenerateacyclecountrequest,andthenprintthecountlisting.The
countlistingwillbeusedbytheinventorystockclerktorecordallcountstaken.
Aftertheitemsonthecountlistingreporthavebeencounted,thecountsshouldbe
entered.Youcanusethesamewindowtoentercountsofitemsrequestedviaautomatic
ormanualcyclecountscheduling.Ifunscheduledcountentriesareallowedforyour
cyclecounts,youcanenterthosealso.
locationcodeisanaddress.Eachinventoryorganizationmustbeassignedatleast
onelocation(address)code.
Defineunitsofmeasureclasses
Unitofmeasureclassesaregroupsofunitsofmeasurewithsimilarcharacteristics.This
isthefirststepinunitofmeasuremanagement. Eachunitofmeasuredefinedmust
belongtoaunitofmeasureclass.
Unitofmeasureclassesarenotorganizationspecific.
DefineUnitsofMeasure
Unitsofmeasureareusedbymanyfunctionsandtransactionstoexpressthequantityof

items.Definingunitsofmeasureisthesecondstepinunitofmeasuremanagement.The
primaryunitofmeasureisthestockingunitofmeasureforaniteminaparticular
organization,whichisanattributethatisspecifiedwhendefiningeachitem.
Unitsofmeasurearenotorganizationspecific.
InventoryDefinitions

CategorySet.Agroupingofitemcategories.Acategorysetisauserdefined
entityforgroupingitemsbycategorywithinthecategorysetentity.Oracle
inventoryrequiresatleastonecategorysetbeused.Productfamily,commodity,
usage,oranyothergroupingandreportingrequirementsausermayhave
generallydefinecategorysetsforgroupingitems.Categorysetsmaybedefined
atthemasterorganizationlevelortheinventoryitemorganizationlevel.
ItemCategory.Acodeusedforclassifyingorgroupingitems.Itemsare
assignedtoacategorywithinacategorysetforreportingandgrouping.Tosee
thegrouping,auserwouldspecifyacategorysetandoneormorecategoriesfrom
thatset.
InventoryItem.Apartnumberorproductcodeusedtotrackgoodsorservices.
Inventoryitemnumbersrepresentphysicalgoodsthatarepurchased,builtor
assembled.Inventoryitemnumbersmayalsobecreatedtorepresentservices
soldtocustomers.Thesenumbershaveattributesthatdescribeorcontrolhowthe
itemisused.
InventoryitemsarecreatedinanItemMasterOrganizationandthenassignedto
executioninventoryorganizations.Attributesforitemsmaybesetatthemaster
level,sothevalueisconsistentacrossallorganizations,orattheorganization
level,sothatthevaluemayvarybyorganization.Theattributecontrollevel
determinesifanattributeissetatthemasterororganizationlevel.Anexampleof
atypicalmasterlevelcontrolledattributeisItemDescription,whichyoumay
wanttobethesameacrossallorganizations.Plannercode,however,issetatthe
organizationlevel,aseachorganizationhasaplannerresponsibleformanaging
theitem.
InventoryOrganization.Anentityusedtorepresentamanufacturingor
distributionsite.Inventoryorganizationsarewhereausertracksonhand
balances,manufacturesgoods,andtransactsthedailyinsandoutsofmaterial
movement.Aninventoryorganizationisthelowestlevelentityforcostinggoods,
planningmaterialrequirements,andsecuringsystemaccess.Onlyasingle
addressmaybeassignedtoanInventoryOrganization.Aninventoryorganization
isassignedaSetofBookswhichdeterminesthechartofaccounts,fiscalcalendar,

andbasecurrencyforallfinancialandvalueaddedactivitiesthatoccurwithinthe
organization.InventoryOrganizationsarealsoassignedtoaLegalEntity
OrganizationandanOperatingUnitOrganization.
Avariationontheinventoryorganizationisthemasteritemorganization.
Generally,withOracleApplicationsasingleinventoryorganizationiscreatedand
designatedatthemasterorganization.Itemsaredefinedfirstinthemaster
organization,thenenabledinotherinventoryorganizationsasnecessary.Someof
theitemattributesaresetascontrolledatthemasterorganizationandtherefore
theattributevaluescannotbeupdatedwithinindividualinventoryorganizations.
Categorysetsmayalsobedesignatedasmasterorganizationlevel.Cross
referencesarealsomasterlevelonlyormasterleveloptionalaswell.
LegalEntityOrganization.Anentityusedtorepresentalegalcompany.Fiscal
andtaxreportingaredoneattheLegalEntitylevel.
Location.Alocationissimplyanameandaddress,andisassignedtoan
organizationorusedtoindicatedeliveryinformationonapurchaseorder.You
maydefineasmanylocationsasyoulike,butonlyonelocationmaybeassigned
toaninventoryorganization.
Multiorg.MultiorgoftenreferstoanOracleApplicationssetupusedtoenable
multiplebusinessunitsinasingleinstall.Withmultiorg,abusinessenterprise
maysetupmultiplebusinessunitswithdifferingsetsofbooks,operatingunits,
andlegalentitiesallwithinasingleinstance.Withmultiorg,goodsmybesold
outofoneoperatingunitorlegalentityandshippedoutofanother,andthe
systemwillprocessanintercompanysaletoproperlyaccountforit.
Multiorg,however,shouldnotbemistakenforinstallswithmultipleinventory
organizations.YoudonothavetouseOracleApplicationsmultiorgtosupport
multipleinventoryorganizationsifalltheinventoryorganizationssharethesame
setofbooks,operatingunit,andlegalentity.
OperatingUnitOrganization.Abusinessunitthatsharesacommon
Purchasing,AccountsPayable,OrderEntryandAccountsReceivablesetup.An
operatingunitmayconsistofmultipleinventoryorganizations,withmultiple
manufacturingsites,distributioncenters,andsalesoffices,buttheysharea
commonsalesorderandpurchaseordersystem.Forexample,asalesordermay
havelinesshippingfromdifferentinventoryorganizationsorapurchaseorder
mayhavelinesdestinedfordifferentinventoryorganizations.
SetofBooks(SOB).Thefinancialentitythatrepresentsthechartofaccounts,
fiscalcalendar,andbasecurrency.TheSOBissetupintheGeneralLedger

StockLocator.Aphysicalareawithinastockroom.Thestocklocatorisakey
flexfieldthatisoftendefinedasamultiplesegmentflexfieldwiththesegments
representingthephysicallayoutofastockroom.Forexample,astockroommay
belaidoutinrowsofshelveswithbinsontheshelves,eachnumberedsothata
row/shelf/bincombinationwoulddirectsomeonetoaparticularmaterialstorage
compartment.Suchanimplementationwoulddefinealocatorflexfieldasa3
segmentflexfieldwithsegmentsforrow,shelf,andbin.
Subinventory.Physicalorlogicallocationsforstoringinventory.
Subinventoriesaregenerallydefinedtorepresentthemainstoresareaaswellas
stockingpointsontheproductionfloor.Additionalsubinventoriesmaybeusedto
specifysupplyclosetsorcabinetsandthecageareafordiscrepantmaterial.
Subinventoriesareflaggedastoavailabilityforplanning(nettable),reservations,
andavailabletopromisechecks,therebydeterminingtheavailabilityofthe
materialstoredinthesubinventory.Subinventoriesareassignedmaterialasset
accountnumbers.Asgoodsmoveinandoutofasubinventoryatransactionposts
totheassetaccount.
WorkdayCalendar.Theworkdaycalendarindicatesthemanufacturing
workdaysforaninventoryorganization.Thecalendarindicatesholidaysaswell
asworkshifts.Multiplecalendarsmaybedefinedforanorganizationtorepresent
differencesinworkdaysbydepartmentorgroup.
Definignewitems
Overview
Newitemdefinitionisacriticalfunction.ItemscarryattributesthatcontrolhowOracle
Applicationsmanagestheitem.Itemsmustbeassignedtocategorysetswithacategory
value.Newitemsoftenneedbillsandroutingssetup,ormayneedsuppliersidentified,
orneedpricelistscreated,andlikelyneedtobecosted.Muchofthedaytodayactivity
withinacompanyororganizationpurchasingmaterial,buildinggoods,sellingproducts,
andservicingwhatwassold,evolvesarounditems.Accurate,timely,andcomprehensive
itemdefinitionsmoothesthedailybusinessflowandminimizesfutureproblems.
Itemsarealwaysdefinedinthemasterorganizationfirst,thanenabledintheusing
inventoryorganizations.
temStatusCodesmaybeusedtosetorupdatethedefaultvaluesforcertainitem
attributes.Theycanbeusedtocontrolthefunctionalityofanitem.Whenyouupdatethe
valuesforastatus,allitemsthatusethatstatuswillbeupdatedalso.
TheItemStatusCodecontrolscertainitemattributesdesignatedasstatusattributes.
Theyare:
BOMAllowed
BuildinWIP

CustomerOrdersEnabled
InternalOrdersEnabled
InvoiceEnabled
Transactable
Purchasable
Stockable
Statusattributesenableanddisablethefunctionalityofanitemovertime.Eachstatus
attributeallowsyoutoenabletheitemforaparticularuse.Forexample,ifyousetthe
statusattributePurchasabletoYes,youcanputtheitemonapurchaseorder.

OverviewItemTemplate
Itemtemplatesaredefinedsetsofattributesthatcanbeusedoverandovertocreatemany
similaritems.Templatesmakeinitialitemdefinitioneasier.Whenyouapplyatemplate
toanitem,youoverlayordefaultinthesetofattributevaluestotheitemdefinition.
Youcanapplythesameordifferenttemplatestoanitemmultipletimes.Themore
recentattributevaluesfromthelasttemplateappliedoverridepreviousvaluesunlessthe
previousvalueisnotupdateable.
Note:BeforedefininganItemTemplate,makesureyouareintheGLOBAL
organization.
ItemTypest
ItemTypesareauserdefinedcodeassignedtoitemsasausergroupingforitems.Itis
strictlyauserdefinedentitywithnofunctionalitybuiltaroundit.
R2idefinesItemTypestomatchItemTemplates.Thisisacommonpracticeamongthe
OracleInventorycommunityandservestwopurposes.
1.ItemTemplatestendtobedefinedbygroups,orclasses,ofitems.Thisisa
naturalgrouping,asmanyitemattributesaresetbasedonthisuserdefined
grouping.Forexample,allpurchasedcomponentsmaybegroupedtogether
withanItemType,oritmaybebrokendownfurthersuchaspurchased
commoditycomponentsandpurchasedcustomcomponents.Separate
templatesmaybedefinedforeachgroup,asselectitemattributesmayvary,
andseparateitemtypesdefinedforeachtosupportcustomreporting.
2.Byassigningtheusertypetoitscorrespondingtemplate,theusertypeattribute
isassignedthetemplatenamelastusedtodefineorupdatetheitem.Iflatera
problemisfoundwithanattributesetting,theusertypewillindicatethe
templateusedtoupdatetheitemtherebyassistingwithproblemresolution.

R2iincludesitemtypestomatchtheR 2itemplates.Ifyouaddnewitemtemplates,add
acorrespondingitemtype.
MINMAXPLANING
Overview
YoumustdecidewhetheryouwilluseMinMaxplanningattheOrganizationor
Subinventorylevel. IfyouplanattheOrganization level, youwill setupthe
planningattributesforyouritemsintheitemmastersetup.Ifyouplanatthe
subinventorylevel,youwillsetupitem/subinventoryplanningparameters.
InventoryProfileOptionINV:MinmaxReorderApproval
SourceOrganization/Subinventory
IfyouselectedSourceType
Inventory,youmustdesignatean
Organizationfromwhichto
requisitionreplenishments.Ifyou
selectSubinventory,youmustenter
anonnettablesubinventory.
Restock
SelectYesorNo.
YescausesOracletocreatepurchase
requisitionsorrequisitionsfor
InternalOrders,dependingonthe
SourceTypeselectedinsettingup
theItem.

MISCELLANEOUSTRANSACTIONS
Overview

No causes no requisitions to be
generated.Forreviewpur

With miscellaneous transactions, material can be issued and received from

general ledger accounts. This
allows material to be
issued/receivedfromnoninventory
areas such as engineering,
facilities, or any other requesting
department. Manual adjustments
can also be made for accounting
purposesbyreceivingmaterialfrom
oneaccounttoinventory,andthen
issuingthatmaterialfrominventory

toanotheraccount.

OverviewMOVEORDERS
AMoveOrderisarequestforsubinventorytransferoraccountissue(alsocalled
anaccounttransfer).Whenusinganaccounttransfer,theactualmovementisan
issuenotatransferfromsubinventorytosubinventory.
Thesetransactionsareonetimeoccurrenceswithnowaytoplantheseintra
organizationmaterialmovements.MoveOrdersallowplannersandfacility
managerstorequestthemovementofmaterialwithinthefourwallsofa
warehouseorfacilityforreplenishment,materialstoragerelocations,quality
handlingorotherpurposes.
IndividualuserscanrequestmoveordersandOracleInventorywillautomatically
createmoveorderswhenwarrantedforinventoryreplenishmentandorder
picking.
Thisdocumentwillcoverthemoveorderscreatedthroughminmaxplanning.
NOTE:Ifyouwanttobypassthemoveorderapprovalprocessandautomatically
approvemoveorderrequisitions,enter0daysintheMoveOrderTimeoutPeriodfield
andselectApproveautomaticallyintheMoveOrderTimeoutActionfield.
TotalAvailable=
Nettable:
specified.
OnOrder

NettableQuantityOnhand+OnOrderOpenDemand,where
QuantityOnhandisnettablequantityinthesubinventory
isthesumofopenpurchaseorders,requisitions,andinternal
ordersandshipmentsscheduledforreceiptpriortooronthe
SupplyCutoffDate.Ordersreferencingothersubinventories,or
withnosubinventoryspecified,arenotincludedifthereportisrun
forasubinventory.

OpenDemand
isthesumofopensalesordersscheduledtoshippriortooron
the
DemandCutoffDate:Salesorderdemandreferencingothersubinventories,orwithouta
specified
subinventory, are not included if the report is run for a
subinventory.
IfTotalAvailable<MinimumQuantity,suggestaneworder,
where
Minimum Quantity is the value for the MinMax Minimum
Quantityitemattribute.

Overview
AMoveOrderisarequestforsubinventorytransferoraccountissue(alsocalled
anaccounttransfer).Whenusinganaccounttransfer,theactualmovementisan
issuenotatransferfromsubinventorytosubinventory.
Thesetransactionsareonetimeoccurrenceswithnowaytoplantheseintra
organizationmaterialmovements.MoveOrdersallowplannersandfacility
managerstorequestthemovementofmaterialwithinthefourwallsofa
warehouseorfacilityforreplenishment,materialstoragerelocations,quality
handlingorotherpurposes.
IndividualuserscanrequestmoveordersandOracleInventorywillautomatically
create move orders when warranted for inventory replenishment and order
picking.
.

Thisdocumentwillcovercreationofamanualrequisitionandapprovingit.

DefineaplannerfortheitemundertheGeneralPlanningtaboftheItemswindow.Ifyou
donot
assignaplannertotheitem,themoveorderwillbeautomaticallyapproved.
Therearefivetypesofmoveorders;
a.MoveOrderRequisition
b.MoveOrderReplenishment(Minmaxorreorderpointplanning)
c.PickWaveMoveOrder(OrderManagement)
d.ReceiptMoveOrder(Futurerelease)
e.WIPIssueMoveOrder(Futurerelease)
REORDERPOINTPreprocessing
order

Enterthenumberofdaysrequiredtoplacean

Overview
Reorderpointplanning canbeusedasanalternative toMRP orMin/Maxplanning.
Reorderpointplanningusesdemandforecaststodecidewhentoorderanewquantityto
replenishinventory.Reorderpointplanningsuggestsaneworderforanitemwhenthe
availablequantity(onhandquantityplusplannedreceipts)dropsbelowtheitem'ssafety
stocklevelplusforecastdemandfortheitemduringitsreplenishmentleadtime. The
suggestedorderquantityisaneconomicorderquantitythatminimizesthetotalcostof

ordering and carrying inventory. Oracle Inventory can automatically generate

requisitionstoinformyourpurchasingdepartmentthatareplenishmentorderisrequired
tosupplyyourorganization.
Iftheforecastiscorrectandtheorderarrivesontime,theinventorylevelshouldberight
atthesafetystocklevelatthetimeofreceipt. Incaseswherethedesiredsafetystock
levelchangesduringtheorderleadtime,OracleInventoryusesthelargestsafetystock
quantityduringtheleadtime.
Whenanorderistriggered,theEOQisthesizeofthetriggeredorder.
EOQ=squarerootof:[(2XannualdemandXordercost)/(carryingcostpercentXUnit
cost)]
OracleInventorycalculatesannualdemandasthecurrentdemandrateannualizedby
multiplyingthecurrentperioddemandforecastbythenumberofperiodsperyear(12or
13).
Leadtimes
Preprocessing

Enterthenumberofdaysrequiredto
placeanorder

Processing

Enterthenumberofdaysrequiredto
acquireormanufacturetheitem

Postprocessing

Enterthenumberofdaysrequiredto
receivetheitemintoinventoryafter
initialreceiptfromthesupplier

Subinventories
Overview

Subinventoriesaresubdivisionsofanorganizationandmayrepresentphysicallocations
suchaswarehousesorstoreroomswithinwarehouses.Inventorytransactionsfromandto
subinventoriesposttoaccountsassignedtothesubinventoryintheDefineSubinventories
form.Asubinventorycanbeassociatedwithanassetaccountoranexpenseaccount.
InventoryAccuracyOverview
Inventory Accuracy
Oneofthemajorcomponentsofacompanysassetsisitsinventory.Accuratesystem
onhandquantitiesareessentialformanagingsupplyanddemand,maintaininghigh
servicelevels,andplanningproduction.Thecontrolofandaccountingforinventoryisa
crucialpartofdailyoperations.TwoprocessesareprovidedinOracleInventoryto
validateonhandquantitiesandvalues.TheyareCycleCountingandPhysicalInventory.

CycleCounting
Cyclecountingistheperiodiccountingofindividualitemsthroughoutthecourseofthe
yeartoensuretheaccuracyofinventoryquantitiesandvalues.Cyclecountingcanbe
usedinlieuoftakingacompletephysicalinventory,orbothtechniquescanbeusedside
byside.
TheOracleCycleCountfunctionalitysupportsthecountingofallmaterialresidingin
quantitytrackedsubinventories.Theprocessselectsandranksitemsforcyclecounts.
Daily,weekly,ormonthlycyclecountlistingsarethenprintedtouseinperformingthe
cyclecount.Aftertheitemsarecounted,thecountquantitiesareenteredintothesystem
andreconciliationreportsarerun.Oncethevariancesarereviewedtheitemshouldbe
recountedorifthevarianceisacceptable,thecyclecountisapproved.Uponapproval
thesystemwillcreateanadjustmenttransactionadjustingtheonhandquantities.
PhysicalInventory
APhysicalInventoryusuallyentailsawalltowallcountofallstoresinventory.Ifthe
countistosupportfiscalyearendfinancialreporting,tightcontrolsarenecessaryto
ensurethatallinventoriedgoods,subassembliesandcomponentsareaccountedfor.
Generally,themovementofgoodsinandoutofstockroomsiscutoffduringthecount,
withexceptionsallowedforemergencyshipmentsonly.
TheOraclePhysicalInventoryfunctionalitysupportsthecountingofallmaterialresiding
inquantitytrackedsubinventories.Toassistincontrollingthecount,tagnumbersare
assignedforeachsuggestedcount.Counttagsmaybeprintedandusedtorecordcounts.
Oncetagsareentered,reconciliationreportsmayberuntoensureacompletecount.
Oncethevariancesarereconciled,thephysicalinventoryisapproved.Uponapprovalthe
systemwillcreateanadjustmenttransactionadjustingtheonhandquantities.

Inventory Planning Overview

Thisprocesscoversdifferentwaystoreplenishinventory.Alloftheautomatedmethods
usetheRequisitionImportconcurrentprogramtomoveinformationfromInventoryand
ManufacturingtoPurchasing.
MinMaxplanningisamethodwhichreordersitemsthatmeetthefollowingcondition:
onhandquantity+onorderquantityislessthenminimumquantity.Whenthis
conditionismet,thenthesystemwillgeneratearequisitiontobringthequantityuptothe
maximumquantity.Theminmaxinventoryplanningmethodmaybedoneatthe
organizationlevelorthesubinventorylevel.Thisistheonlyplanningprocessthatoffers
asubinventoryleveloption.Tobeginthisprocess,runaconcurrentrequestthatloadsthe

RequisitionImporttableswithallitemsthatmeettherequirements.Thisisthe
recommendedR2iapproach.
ReorderPointplanningmethodisusedtodeterminewhenandhowmuchbasedupon
CustomerServicelevel,safetystock,carryingcost,ordersetupcost,leadtime,and
averagedemand.
Forexpenseditems,ReplenishmentCountingcanbeusedtogeneraterequisitions.This
isrequiredonitemsthatyoudonottrackonhandbalances(expenseitems).
ReplenishmentCountingisnotincludedinbaseR2i.
MRPPlannersWorkbenchistheprocessforplannersworkbench.EitherMRPorMPS
mustberuntousethisplanningmethod.FormoreinformationonMRPPlanners
Workbench,seetheR2iMRPPlanningdocumentation.
OracleInventoryOrganizations
OracleApplicationsusesmultipletypesoforganizationstobuildthebusiness
executionstructure.Atthetopofthestructureistheaccountingsetofbooks
(SOB),definedintheGeneralLedger.Next,differenttypesoforganizations
areusedtofurtherdefinetheorganizationstructureandrelationships.In
additiontoasetofbooksR2iincludesaLegalEntityorganization,anOperating
Unitorganization,andaninventoryorganization.Allorganizationsaredefined
andupdatedwiththeDefineOrganizationform.
SetofBooks.AGeneralLedgerSOB,linkedtotheinventoryorganization,
controlsthefinancialaccountingofinventorytransactions.ASOBismadeup
ofachartofaccounts,afinancialcalendar,andacurrency.Thegeneralledger
securestransactions(journalentries,balances)bySOB.R2iincludesaSOB
calledR2iUSClient.Thisnameshouldbeupdatedwiththeclientscompany
name.SeetheR2iGeneralLedgerdocumentationformoreinformation.
LegalEntity.Alegalentityorganizationdefinesthetaxandfiscalreporting
level.Thelegalentityrepresentsthelegalcompany.R2iincludesaLegal
EntityorganizationnamedR2iLE.Thisnameshouldbeupdatedwiththe
clientscompanyname.
OperatingUnit.AnoperatingunitorganizationdefinesthePurchasing,Order
Entry,AccountsPayableandAccountsReceivablelevelofoperation.An
operatingunitmayspanmultiplemanufacturingfacilities,distributionpoints
andsalesoffices,oritmaybelimitedtoasinglesite.Anoperatingunithasa
singleSOBandasingleLegalEntityrelationship.R2iincludesanOperating
UnitnamedR2iOU.Thisnameshouldbeupdatedwiththeclientscompany
name.

InventoryOrganization.Twoflavorsofinventoryorganizationsarefoundin
OracleApplications.Theyaredefinedthesame,andbothareassignedasetof
books,alegalentityorganization,anoperatingunitorganization,andalocation.
Anitemmasterorganizationisusedforitemnumbermaintenanceand
validation.Thismasterorganizationservesasadatarepositorystoringitems
anditemattributes,masterlevelcategoriesandcategorysets,masterlevelcross
references,andnumerousdatadefaults.Onhandbalances,inventory
movements,andotherongoinginventoryactivitiesarenotperformedinan
itemmasterorganization.Generally,themasterorganizationisusedasthe
validationorganizationforPurchasingandOrderEntry.Itisrecommendedthat
asingleitemmasterorganizationbedefined,eveninmultipleorganization,
multiplesetsofbooksenvironments.R2iincludesanitemmasterorganization
calledGLOBAL.Generally,thisnameisusedbytheclientandnotchangedas
partoftheR2isetup.
Inadditiontotheitemmasterorganizationthereareoneormorenonmaster
inventoryorganizations.Liketheitemmasterinventoryorganization,thenon
masterorganizationsareassignedasetofbooks,alegalentityorganizationand
anoperatingunitorganization.Thenonmasterinventoryorganizationpointsto
amasterorganizationandlookstothemasterorganizationformasterlevelitem
attributes,masterlevelcategories,andothermasterlevelcontrolleddata.Note
thateachorganizationhasitsownsetofbooks/legalentity/operatingunit
relationship,soinventoryorganizationswithdifferingSOBsoroperatingunits
maysharethesamemasterorganization.
Thesenonmasterinventoryorganizationsaretheexecutionlevelorganizations.
Theyholdonhandbalancesandtransactionhistory.Hereiswhereinventory
usersexecutetheirdailyactivities,suchasreceivingandissuingmaterial,
performingcyclecounts,andviewingmaterialavailabilityandtransaction
history.Asingleorganizationthereforegenerallyrepresentsasingle
manufacturingsiteordistributioncenter.R2iincludesasinglenonmasteritem
inventoryorganizationcalledCompany.Thisnameshouldbeupdatedwiththe
clientscompanyname.
Locations.Alocationcodeisanaddress.Eachinventoryorganizationmustbe
assignedatleastonelocationcode.R2iincludesasinglelocationcodeof
HDQTRS.Thiscodeshouldbeupdatedtotheclientscompanynameandthe
addressshouldbeadded.
Subinventories.Asubinventoryisusedasaholdingpointforonhand
inventoryandgenerallyrepresentsastockroom,stockingareaorcageusedfor
storingmaterial.Subinventoriesaredefinedwithininventoryorganizations.
Aninventoryorganizationmayhaveanynumberofsubinventories,andanasset

accountisassignedtoeachsubinventory.Sincethesubinventoryentityis
logical,asthereisnotanaddressorphysicallocationdescriptionassociated
withit,clientsmaydefinesubinventoriesforanyphysicalorlogicalgroupingof
inventory.
TheR2iinventoryorganization,Company,includes4predefinedsubinventories:
3.Stores.Usedfortheprimarystockroomforstoringrawmaterialsandsub
assemblies
4.FG.UsedforFinishedGoodsinventoryiffinishedgoodsarestocked
5.WIP.Usedforrawmaterialandsubassembliesstoredinproductionareas
andissuedatoperationorjobcompletion(backflush).
6.MRB.UsedforMaterialReviewBoardgoods.Thisisgenerallymaterialthat
requiresengineeringreviewbeforedispositionasscrap,rework,returnto
supplieroruseasis.
StockLocators.Stocklocatorsareanoptionalentitythatmaybeusedto
representphysicallocationswithinasubinventory.Youmaychoosetouse
stocklocatorsforselectedsubinventoriesorselecteditemswithinselected
subinventories.Iflocatorsareused,subinventoryandlocatortrackonhand
balances.Therefore,iflocatorsaredefinedtorepresentashelfwithina
stockroom,onhandbalancesonthesystemwouldshowtheitemandquantity
downtothephysicallocationwithinthefacility.
OracleInventoryusesakeyflexfieldforstocklocators.Thispresentsafew
limitationsforitsuse.Onlyonelocatorflexfielddefinitionisallowedper
install.Therefore,ifthestockroom(subinventory)wantstotrackmaterialby
row,binandshelf,itwilllikelydefineathreesegmentflexfieldwithsegments
forrow,bin,andshelf.Iflocatorsaredesiredforanothersubinventory,evenin
anotherorganization,thestructurewillagainbe3segmentsforrow,binand
shelf.Inadditiontothislimitation,locatorsmustbeuniquewithinan
organization;youcannotusethesamelocatorindifferentsubinventorieswithin
anorganization,butyoucanusethesamelocatorinsubinventoriesina
differentorganization.
MiscellaneousTransactionProcess
Withmiscellaneoustransactions,materialcanbeissuedandreceivedfrom
generalledgeraccounts.Thisallowsmaterialtobeissued/receivedfromnon
inventoryareassuchasengineering,facilities,oranyotherrequesting
department.Manualadjustmentscanalsobemadeforaccountingpurposesby
receivingmaterialfromoneaccounttoinventory,andthenissuingthatmaterial
frominventorytoanotheraccount.

Step1.0FillOutMaterialTransferForm

FillouttheappropriateMaterialTransfer(MT)formtorequestmaterialfroma
subinventory.Gatheralloftherequiredapprovals.
Step2.0 DeliverMaterialTransferFormtoStores
DelivertheMTformtothecorrectdestination.
Step3.0 VerifythatMaterialisOnHand
UsingtheViewOnHandQuantitiesform,checktomakesurethatmaterialisin
stock.Iflocatorcontrolisturnedonforthesubinventory,theformwillalso
showatwhatlocationthematerialislocated.
Step4.0 ReturnMaterialTransferFormtoRequestor
Ifthereisnoneoftherequestedmaterialinstock,returntheMTbacktothe
requestor.Pleasenoteonthereturnedformifanothersubinventoryhasthe
materialinstock.
Step5.0 StockClerkPhysicallyRetrievesMaterial
Ifthesystemshowsthattherequestedmaterialisinstock,pullthematerial
fromthesubinventory.Ifthematerialcannotbelocated,returntherequestform
backtotherequester.
Step6.0ProcessMiscellaneousTransaction

Choosethetypeoftransactionthatneedstobeprocessedaswellastheother
requiredinformationontheinitialform.ForAccountAliasIssues/Receipts,
enterthealiasnameintheSourcefield.ForAccountIssues/Receipts,enterthe
accountnumberintheSourceField;itwilltransfertotheAccountfield.For
MiscellaneousIssues/Receipts,theaccountnumbercanbeenteredinthe
AccountfieldorontheTransactionLinesscreen.
ClickontheTransactionLinesbuttonintheMiscellaneousTransaction
window.TheTransactionLinesDetailfolderwindowappears.Enterthe
inventoryitemtoissueorreceive.Therevisionmustbeenterediftheitemis
underrevisioncontrol.Enterthesubinventoryfromwhichthematerialisbeing
transacted.Foranissuetransaction,youcannotenterasubinventorythatdoes
nothaveQuantityTrackingturnedon.Enteralocatorifthesubinventoryis
underlocatorcontrol.Optionally,enteralotnumberfortheitem.Ifyouwant

toentermultiplelotnumbers,completetheremainingstepsthenchoosethe
Lot/SerialbuttontodisplaytheLotEntrywindow.Enterthequantityofthe
inventoryitemtoissueorreceive.Ifthesystemisusingaveragecosting,enter
theunitcostoftheitemtoreceiveorissue,orleavethisfieldblanktousethe
systemaveragecostatthetimeofthetransaction.Optionally,enterareason
codeforthetransaction.Forexample,reasoncodesallowyoutomark
exceptionalchargestosupportqualitydatacollection.Optionally,enterupto
240charactersoffreetextthatdescribethetransaction,usuallytheMTnumber.
Enterthegeneralledgeaccounttobeusedinthetransactionifyouareusinga
MiscellaneousIssue/ReceiptorUserDefinedtransactiontype.
Step7.0DeliverMaterialtotheRequester

Delivertherequestedmaterialtotherequester.
Step8.0 FilePaperCopyoftheMaterialTransferForm

FilethepapercopyoftheMaterialTransferformintothefilecabinet.