How the Overhead labour time is tracked into the system? We have some unbalanced entries and we do not find a way to correct them. This is the situation , we do have labour entries ( direct and indirect ) and also some overhead entries. However , when we checked the associated Overhead account, amount is not what we expect to see.
Any steps on how to resolve that issue? As we rely on that for Payroll, we either sometimes understate or overstate amounts
I checked and It looks like all production orders posted to the correct indirect absorption GL account. However, they are also several indirect activities that should be posted to that same GL too as we are using MES to post Jobs. So I’m not sure how to begin the process to analyse that.
The point is: Overhead hours/amount is different than what actually were transferred vs amount found in “estimated indirect absorption” Gl account . From the transferred registration , I filtered on a day only but I am not able to identify labour hours/amount vs amount posted on the GL. I understand the whole process but i need some sort of guidance to walk through
Hi Adam, thank you. I did what you said and I was able to identify all incorrect transactions.
In all those transactions, I have 2 types of transactions:
1.One transaction with a worker where it looks like the status of the work order was changed from " start" to “estimate” and this creates a reversal transaction. However the same thing was not created in Transferred registration so this leads to a gap.
Another type of transaction has no worker assigned and it was generated because Automatic route consumption is set to “Always “ on that production order eventhough on the production parameters , the setting is “Never”. Here also the same transactions was created into the transferred registration which also create a gap.
Question: How can I correct those transactions properly? and espacially from accounting point of view? Any help will be appreciated.
You first need to understand why an in-progress order was started, and reset. If it was started again the labour is valid - they will not have double booked so it is the time you are looking at. If the order was never started you need to decide how to account for labour consumed on a works order that resulted in nothing.
The parameter is a global setting overridden whenever and wherever. You need to understand why they are attributing cost in this manner at what they want to do with it - it is perfectly valid to do this if required.